It was with great concern that the Brazilian government learned today of the decision by the United States to apply a 25% tariff on steel imports and a 10% tariff on aluminum imports, under alleged security concerns.
These measures will cause grave harm to Brazilian exports and have a significant adverse impact on bilateral trade flows – which have been amply favorable to the United Sates over the past 10 years – as well as on trade relations and investment between the two countries.
Since U.S. Department of Commerce investigations began in the first half of 2017, the Brazilian government, in coordination with the national steel industry, has on many occasions tried to prevent the application of these measures to Brazilian exports, clarifying to the government and other interested parties in the United States that products from Brazil threaten neither U.S. trade interests nor its security. On the contrary, industries of both countries are integrated and complement each other. Approximately 80% of Brazilian steel exports are semi-finished products that are used as inputs in the U.S. steel industry. Moreover, Brazil is the largest buyer of metallurgical coal from the United States (approximately US$1 billion in 2017), chiefly for the manufacture of Brazilian steel for export to the United States.
These measures by the United States will undermine ongoing efforts at the Global Forum on Steel, in which the United States participates, which seeks to find a solution to the issue of excess productive capacity in the steel industry, the root cause of the problem.
The restrictive measures applied to steel and aluminum imports are not compatible with U.S. obligations in the World Trade Organization and are not justifiable under GATT 1994 security exceptions.
Brazil has a preference for dialogue and partnership, but will take all necessary action, on both bilateral and multilateral levels, to preserve its rights and interests.
Minister Aloysio Nunes and Minister Marcos Jorge