Brasilia, Aug 21 US-imposed tariffs on Brazilian products could cause a drop in the country's exports for the first time in 21 months, while also negatively impacting investment and employment, the National Confederation of Industry (CNI) warned in a report.
According to the CNI's latest survey on Wednesday, export expectations for Brazil's industrial sector for the next six months fell 5.1 points to 46.6 points in August. When the indicator falls below 50 points, it indicates an expected contraction in exports, Xinhua News Agency reported.
"The worsening of export expectations is closely related to uncertainties in the external environment, mainly due to the new US trade policy," said Isabella Bianchi, CNI's policy and industry analyst.
A 50 percent tariff imposed by the US government on a number of Brazilian products took effect on August 6.
According to the CNI, the measure is already having an impact on industrial employment, which declined in July despite a rise in production growth.
The employment expectations index dropped to 49.3 points in August, signalling that employers do not anticipate job growth in the next six months.
Business owners are less inclined to invest. "The investment intention index fell to 54.6 points, the lowest level since October 2023. However, it remains 2.1 points above the historical average of 52.5 points," the report noted.
Earlier on August 14, Brazilian President Luiz Inacio Lula da Silva said Brazil will not bow down to the United States, countering the claim by his US counterpart Donald Trump that Brazil is "a horrible trading partner."
"It is a lie when the US President says that Brazil is a bad trading partner. Brazil is good, it just won't bow down to the US government," Lula said during an event in the northeast state of Pernambuco.
Earlier, Trump said Brazil is a "horrible trading partner," calling the trial against former Brazilian President Jair Bolsonaro a "political execution."
Lula said that "democracy is judging Bolsonaro."
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