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The Brazilian government believes it has sufficient room to increase import tariffs instead of resorting to more aggressive measures like quotas, should a wave of industrialized goods from China flood the local market. The risk of such a redirection to Brazil has grown in the wake of the global tariff escalation set off by U.S. President Donald Trump.
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Since the beginning of the trade tensions, Brazil has been closely monitoring any potential uptick in the flow of Chinese-made goods to its domestic market, in an effort to “separate the wheat from the chaff.”
“It’s crucial that we base our actions on clear data: to determine whether there is indeed a flood of products or not,” said a Brazilian government official, who noted that so far, no significant increase has been observed.
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If Chinese products do end up being rerouted to Brazil in large volumes, authorities see an increase in import duties as a more straightforward tool to deploy. The government source emphasized that there is legal leeway under both World Trade Organization (WTO) and Mercosur rules to implement such measures.
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