Trump's tariffs against Brazil over Bolsonaro will backfire, on us

Various members of the Brazilian government have been trying unsuccessfully to reach their counterparts in Washington ahead of August 1. That is the date Donald Trump has set for the imposition of 50% tariffs on all Brazilian exports unless the administration of Luiz Inácio Lula da Silva finds a way to meet two very controversial conditions set by the U.S. president.

Those conditions include dropping charges against Lula’s far-right predecessor, Jair Bolsonaro, who faces a possible prison sentence for his role in an alleged conspiracy to undermine the 2022 election and adopting a more lenient stance towards U.S.-based social media companies operating in Latin America’s largest nation.

While Lula’s government has insisted it is willing to negotiate the terms of its bilateral trade relationship with the United States, it regards the first condition as an interference in Brazil’s domestic affairs, violating both its sovereignty and its administration of justice under the 1988 constitution.

The stage has thus been set for a showdown that will materially hurt both nations, raising fresh questions about the global political and economic order Trump is forging.

As Brazil’s Finance Minister Fernando Haddad has insisted, Trump’s tariff threats make no economic sense. For one thing, Brazil cannot be said to be ripping off the United States, as Trump alleges. The United States has enjoyed a trade surplus with Brazil for almost two decades. Moreover, many Brazilian exports to the U.S. contain parts manufactured by American companies in the United States itself.

For example, 45% of every commercial Embraer aircraft is composed of American-made parts. Those parts would be slapped with reciprocal tariffs if Trump follows through on his threat.

A 50% tariff on Brazilian exports of orange juice, which constitute 75% of the orange juice marketed around the world and some 60% of all U.S. orange juice imports, would almost certainly make that staple in many American households much more expensive, in addition to putting workers at the bottling plants of well-known brands Tropicana and Minute Maid, both major importers of Brazilian juice, out of work. Trump’s stand on behalf of Bolsonaro would also raise the cost of beef, coffee, and other staples for American consumers.

The United States has enjoyed more than two centuries of friendly relations with Brazil. The hostility toward it today, unfortunately, is indicative of Trump’s foreign policy, where, much more so than his first term, he has been eager to weaponize tariffs, using them in the way previous presidents have used unilateral sanctions — to punish and coerce other nations.

As it tries to negotiate with the White House, the Brazilian government has also sought recourse at the World Trade Organization (WTO). “Well beyond the widespread violations of international trade rules,” Brazil’s representative warned at the WTO Wednesday, “we are now witnessing an extremely dangerous shift toward the use of tariffs as a tool to interfere in the internal affairs of third countries.” While the Brazilian official did not directly cite the United States in his complaint, he garnered the support of 40 other countries — not only China and Russia but also key U.S. allies, including the European Union, New Zealand, and Canada — in his thinly veiled denunciation of Trump’s policy.

It is unclear that anything decided at the WTO will compel Trump, of course — his disregard for international institutions is well known at this point. But Brazil’s efforts indicate an investment in a multilateral global order that the United States is now actively undermining. As Celso Amorim, Lula’s principal foreign policy adviser, observed in an April interview:

“What the U.S. sought to do was not to impose one tariff on China, another on Brazil, etc…. That too, but I think they wanted to force bilateral negotiations” to the detriment of existing multilateral forums. While some might see opportunity in this disruption, Amorim concluded, “the breakdown of the multilateral system brings much greater harm than any possible comparative advantage one might obtain.”

In the short term, Trump will probably manage to establish favorable bilateral deals with multiple countries. In the medium to long term, however, he risks permanently undermining the U.S.-led post-World War II global order, pushing nations like Brazil — deeply invested in multilateralism — toward alternative frameworks beyond Washington’s overweening control.

This is where the BRICS, the intergovernmental organization that includes Brazil, Russia, India, China, South Africa, and five other Global South middle powers, enter the picture. As Amorim put it in a separate interview in a reflection of the mainstream view of Brazil’s experienced diplomatic corps, “BRICS is the new name for multilateralism. It is BRICS that gives us hope for a truly multilateral world.”

From the Brazilian perspective, the point of the BRICS, of which Lula currently serves as chairman, is not necessarily to replace existing bodies like the UN but to make them more representative and thus more durable. This might not be the objective shared by all BRICS members, but it does reflect Brazil’s aspiration for a bigger say within the existing architecture of global governance.

Trump seems utterly uninterested in engaging productively with the constellation of international associations, as his withdrawal this week from UNESCO indicates. Indeed, some of his key backers at home are rallying behind his aggressive approach towards defiant countries. “If you drop the trial and drop the charges [against Bolsonaro], the tariffs go away,” Steve Bannon, once a close advisor to the president, told the New York Times. When asked how this policy approach differed from extortion, Bannon replied simply: “it’s MAGA, baby…It’s a brave new world.”