The Economist compares Trump to a dog that barks but doesn't bite, in an article about tariffs against Brazil.
British magazine assesses that the impact of tariffs imposed by Washington will be limited and highlights Lula's firm reaction.
247 - The magazine The Economist, compared, in reporter Published this Friday, the 8th, the President of the United States, Donald TrumpThe British publication likened the tariffs imposed on Brazil to a "dog that barks but doesn't bite." According to the publication, despite the announcement of a 50% tax on Brazilian exports—one of the highest in the world—the economic impact will be limited due to the extensive exemptions obtained by the Brazilian government.
According to the report, Trump's objective was not economic, but political: to punish Brazil for the trial of his ally, former president Jair Bolsonaro, accused of attempting a coup d'état. The Economist,This is the most obvious example of the White House using tariffs as a tool for political pressure.
Lula's reaction and US retreat
The magazine reports that President Luiz Inácio Lula da Silva reacted firmly, stating that Brazil will not be "tutored" by foreign powers nor will it "humiliate itself" before an unwanted "emperor." Without resorting to direct retaliation, Lula relied on the coordination of Brazilian companies and American importers to pressure Washington.
The result was Trump backing down, excluding nearly 700 products from the tariff list, including airplanes, oil, pulp, and orange juice. As a result, almost half of Brazilian exports to the US became exempt. Itaú Unibanco estimates that the effective rate will fall to around 30%, while Goldman Sachs maintained its forecast for Brazilian GDP growth at 2,3% for this year.
Sectors most affected and market diversification
Still, sectors like coffee, beef, and tropical fruits will feel the effects. Coffee, for example, represents 16% of Brazilian exports of the product and has already registered a one-third drop in shipments to the US in July, according to Cecafé. Beef, which had 17% of its external sales destined for the North American market in 2024, is also facing a decline.
A The Economist, It emphasizes, however, that Brazil has diversified its markets in recent years, with growth in sales to the European Union, Asia, and the Middle East. China, the main buyer of Brazilian beef, recently authorized the import of coffee from 183 new companies in the country.
Risk of commercial escalation
The magazine warns of a possible escalation of the dispute if Lula moves forward with the idea of consulting the BRICS countries to respond to the tariffs. Trump has already labeled the bloc as "anti-American" and threatened to impose new tariffs, which could reach 100% if the group replaces the dollar in international trade.
According to The Economist,Lula has been reaping political benefits by presenting himself as a defender of national sovereignty in the face of pressure from Washington, but his challenge will be to prevent this rhetoric from turning into a larger-scale trade war.
