EU-Brazil trade war kicks offFeb, 19, 2019 Posted by datamarnews
Brazil has requested compensation from the European Union (EU) over import tariffs imposed on steel earlier this month according to a government statement. The government has also notified the World Trade Organization (WTO) of possible remedial measures to “rebalance” the trade deficit following the EU’s action. The compensation sought is US$203.6m, according to Reuters.
If the bloc refuses to pay compensation, Brazil may retaliate by imposing a series of import tariffs on EU products, such as powdered milk. The government recently authorized an increase in import tariffs from 28% to 42% on EU’s powdered milk. However, tariffs on the US$500,000 import commodity are quite nominal considering Brazil’s total import expenditure from the bloc equals around US$35bn. The following Secex graph shows Brazil’s trade exchange with the EU bloc in M US$ FOB for the last ten years:
That said, the Brazilian government remains open to conversation with the bloc. DatamarNews will follow up with further developments of the crisis as events unfold.
The following DataLiner plot shows Brazil’s iron and steel export trends to the European Union against Secex export revenue:
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