Brazil draws up plans to retaliate against Trump’s 50% tariff threat

Brazil is drawing up plans to hit back against 50% US tariffs on the country’s exports, setting the stage for further escalation in Donald Trump’s trade war with Latin America’s largest economy.

The US president vowed to impose steep duties on Brazilian goods on Wednesday, accusing the country of conducting a “witch-hunt” against its former president, Jair Bolsonaro, who is facing a trial over his attempt to overturn his 2022 election defeat.

Luiz Inácio Lula da Silva, Brazil’s current president, swiftly indicated that it would retaliate. “Brazil is a sovereign nation with independent institutions and will not accept any form of tutelage,” he said in a statement.

Trump’s claim that Brazil’s economic relationship with the US was “far from Reciprocal” was also “inaccurate”, Lula added. US tariff hikes “will be addressed” by Brazil, he said.

Early on Thursday, Lula convened Brazilian ministers to discuss how his government should address Trump’s 50% tariff threat. The office of Lula’s chief of staff said a study group would be formed to decide how to react.

Trump has already pledged to retaliate if Brazil retaliates against his attack, with US tariffs due to come into force on 1 August. “If for any reason you decide to raise your Tariffs, then, whatever the number you choose to raise them by, will be added onto the 50% that we charge,” he wrote in a letter to Lula on Wednesday, published on social media.

The threatened tariffs on Brazil are part of a wave of proposed US levies unveiled by Trump this week. While the White House had been scheduled to hike duties on dozens of countries on Wednesday, he ordered a fresh three-week delay to 1 August.

Alongside the latest delay, Trump has written letters to a string of countries, including Bangladesh, Japan and South Korea, informing them of new US tariff rates they will face unless they strike a deal with his administration.