Brazil deals with a serious economic hazard after US President Donald Trump announced a 50% tariff on all goods Brazil exports to the United States, Brazils second-largest trading partner.According to a comprehensive research study by the Federation of Industries of the State of Minas Gerais (Fiemg), these tariffs could cut up to R$ 175 ($31) billion from Brazils GDP over the next 10 years.Official trade data reveals Brazil exported nearly $41 billion in items to the United States in 2015, consisting of oil, steel, machinery, aircrafts, and coffee.
These exports support manufacturers, farmers, and workers in Brazils most competitive sectors.The Fiemg report offers the most thorough analysis of the scenario.
It alerts that manufacturing and farming will take the hardest hit.More than 1.3 million jobs might be lost as factories and farms cut output.
National taxation could drop by about R$ 7 billion, and the nations total wages may fall nearly R$ 36 billion.Trumps 50% Tariffs on Brazil Put R$ 175 Billion at Risk, Fiemg Study Warns.
(Photo Internet recreation)Manufacturers of high-value items, such as aircraft and electronics, face the loss of their main consumer market.
For the United States, these tariffs might require markets to search for new providers, interfering with recognized trade flows.Officials in Brazil have specified they wish to prevent a tit-for-tat escalation and intend to find a diplomatic solution, acknowledging that alternatives to the United States market are restricted and can not quickly accept the volume of items presently exported.Everyday Brazilians might feel the effects through task cuts, increasing rates, and pressure on regional businesses.The figures and cautions from Fiemg and official government data make clear that both countries might suffer for years if settlements stall and tariffs stay in location.