Brazil Ready to Punish the US: US$ 560 Million in Tariffs on 222 Products

Drugs in BrazilIn response to protectionist measures adopted by the U.S. government in the cotton sector and after winning its case brought to the World Trade Organization seven year ago, the Brazilian government is ready to retaliate against the US and has already prepared a list of products that will be subject to retaliation.

The Chamber of Foreign Commerce (Camex), an organ linked to Brazil’s Ministry of Development, Industry and Commerce, approved this Tuesday a trade retaliation against the United States valued at approximately US$ 560 million. The final list is expected March 1st.

222 American products imported by Brazil should face additional tariff barriers to enter the Brazilian market. In some cases, the good will double its price due to the levy. No date has been set for the new rates to take effect, however.

Brazil accuses the U.S. government of giving excessive subsidies to their cotton producers undermining the Brazilian producer. The dispute between the two countries in the WTO started in 2002.

The executive secretary of Camex, Lytha Spíndola, informed that the list will be made public March 1st because it needs to go through “technical adjustments.”

This way Camex is giving the United States 20 extra days to cut its subsidies to cotton, which would suspend the punishment. Nobody is expecting the US to change its behavior, however.

The Brazilian government argues also that it needs time to complete the other part of the retaliation, which will be used especially against U.S. companies in the pharmaceutical industry, through suspension of patents or royalties.

Health Minister, José Sócrates, said yesterday that he had submitted to Camex “a set of drugs” that could be targets of such sanctions. “The decision still needs to be thought out by the entire team of government,” he added.

Brazil had the option to retaliate up to about US$ 900 million, according to the WTO decision, but preferred to exclude from the list capital goods and inputs so as not to harm the Brazilian industry that needs to import machines and equipment.

The Brazilian government is also considering a so-called cross-retaliation by which it would impose retaliatory measures not only against products but also against services and even intellectual property.

The new United States ambassador in Brazil, Thomas Shannon, commented last week that “retaliation is always bad, because they generate counter-retaliation.”

Tags:

You May Also Like

Devon Starts Exploration of Brazilian Oil with 50 Billion Barrels Potential

US-based Devon Energy Corporation announced June 30 that it plans to proceed with development ...

Furniture and Appliances Boost Brazil’s Retail Sales

Retail sales in Brazil grew 2.67% in May in comparison with May, 2004. The ...

Genocide of Indians Has Been All Too Common in Brazil

To mark UN Indigenous Day on August 9, Survival International, the global movement for ...

Brazil Hopes Tax Exemption for Foreigners Will Bring Extra US$ 4 Billion

For some time, foreign investors have not had to pay taxes on stock market ...

Brazil: Bahia Is in State of Siege with Police on Strike and Criminals Roaming Streets

Shopping Iguatemi, the most popular shopping center in Salvador, Bahia, Brazil. 3rd floor in ...

In Effort to Curb the Real Brazil Taxes ADR

The Brazilian government has just taken another measure aimed at containing the appreciation of ...

Brazil Offers Appealing Loans to Build 3,000 Kms of Power Lines

The president of Brazil’s National Economic and Social Development Bank (BNDES), Guido Mantega, announced, ...

What You Can Do

What I discovered on this third journey opened my eyes to the possibility that ...

With Russia Leading Buyers Brazil’s Pork Export Gets 80% Boost

Brazil’s exports of pork rose sharply in the first half of 2005, to US$ ...

Brazil’s Largest Airline Delays Growth Plans Due to Aviation Chaos

Brazil's biggest airline, TAM Linhas Aéreas, said on Tuesday, September 4, it postponed plans ...