Trump to restore steel tariffs on Brazil and Argentina
Donald Trump announced yesterday that he will restore tariffs immediately on all steel and aluminium shipped into the United States from Brazil and Argentina.
In a surprise move, Trump accused the two countries of devaluing their currencies and hurting US farmers. It prompted a sell-off on Wall Street, with US stock markets falling on fears of rising trade tensions.
“Brazil and Argentina have been presiding over a massive devaluation of their currencies, which is not good for our farmers,” Trump said in a tweet.
The announcement came as a symbolic slap in the face for Brazil’s president, Jair Bolsonaro, who has positioned himself as Trump’s closest ally in the Americas.
Bolsonaro told Brazil’s Rádio Itatiaia: “I’m going to call him so that he doesn’t penalise us … Our economy basically comes from commodities, it’s what we’ve got. I hope that he understands and that he doesn’t penalise us with this, and I’m almost certain he’ll listen to us.”
Brazil’s main steel industry body, Instituto Aço Brasil, said it was “perplexed” by the decision and argued that the move would hurt US businesses that use Brazilian steel.
Argentina’s production minister, Dante Sica, called Trump’s announcement “unexpected” and said he was seeking talks with US officials.
The US’s long-running trade war with China has benefited Argentina and Brazil as China has bought more agricultural goods from the Latin American countries in retaliation. But both countries are struggling economically. Brazil’s currency, the real, hit a record low last week and unemployment is above 10%. In Argentina inflation is above 50% and a third of the population live in poverty.
The news came after a week in which it appeared that the White House was tempering its long-running trade disputes in the lead-up to next year’s election. Trump administration officials had hoped to sign a “phase one” deal with Beijing, removing some tariffs, before 15 December, when the US is due to impose an additional 15% tariff on about $156bn (£121bn) of Chinese products.
The commerce secretary, Wilbur Ross, told Fox Business yesterday that the new tariffs were still on the table. “If nothing happens between now and then, the president has made quite clear he’ll put the tariffs in,” he said.