US President Donald Trump has imposed new tariffs on Brazil. They are 40% in addition to the 10% that Washington imposed on all countries back in early April 2025.At first glance, the event may seem routine against the backdrop of the Trump Administration’s many steps to increase tariffs on a wide variety of countries, including both opponents and allies of the United States. But upon closer analysis, Trump's steps have a number of important details. The tariffs on Brazil are almost entirely politically motivated and have little to do with the problem of the US trade deficit. This is not so much about another round of a trade war as about full-fledged sanctions, one of the tools which is changing tariffs. The political background is Brazil's actions to limit American information and political influence on the country and, accordingly, Washington's actions to maintain such influence.
The decision to increase tariffs on goods from Brazil by 40% was made by US President Donald Trump via an Executive Order dated July 30, 2025. The most important detail here is that the order is based on the International Emergency Economic Powers Act of 1977 (IEEPA). The law allows the US president to introduce a national emergency in response to a particular problem abroad that poses a threat to US security. The provisions of the law are very broad and such a problem can be anything from human rights violations abroad to armed conflicts. By introducing a state of emergency on a particular issue, the president gets the opportunity to use economic sanctions to solve the problem. Until July 30, 44 states of emergency were in effect at different times. In other words, the tariff increases against Brazil are being implemented using a legal mechanism that involves the use of sanctions as a result of security issues.
A similar algorithm is used by the Trump Administration on a systematic basis. For example, Executive Order 14257 of April 2, 2025, which introduced 10% tariffs for all countries, was also based on IEEPA and considered the imbalance of trade as essentially a political issue that required the introduction of a state of emergency. The use of tariffs as a tool of coercion was introduced by Donald Trump. Previously, US presidents often used other measures that are considered to be sanctions tools - blocking financial sanctions, import and export bans, etc. A distinctive feature of Trump's policy is the transformation of tariffs into a sanctions tool. Moreover, this transformation is clearly visible in the legal mechanisms used.
At first, it seemed that the transformation of tariffs into a sanctions tool would have its limits. Executive Order 14257 of April 2 of this year was still largely focused on trade issues, although they received a serious political dimension in Trump's interpretation. The politicisation of tariffs was also clearly evident in the negotiations with Russia. Trump threatened to support a bill on 500% duties on third countries purchasing Russian oil and other raw materials. But Russia is usually viewed as a “special case,” when all means are used against a political opponent.
Given such logic, it was difficult to expect that the transformation of tariffs into sanctions would hit Brazil in particular. US-Brazilian trade was clearly different for the better from the threats described by Trump in Executive Order 14257. In 2024, its surplus in favour of the United States amounted to $7.4 billion with an upward trend. Compared to 2023, it grew by 31.9%. Moreover, trade volumes can also be considered quite impressive. In 2024, they amounted to $92 billion. In economic terms, there was simply nothing to punish Brasilia for. On the other hand, Brazil can hardly be called a political opponent of the United States. Yes, we are talking about a large and growing country, an active member of BRICS with great potential. But it is clearly different from, for example, China, with which the US has a set of long-standing political problems (for example, the Taiwan issue), ideological differences (China maintains its commitment to socialism based on a strong civilisational foundation and national interests) and increasingly tough competition in the economy and finance (China is pursuing industry, technology and finance in its own way). Such problems in relations between Brazil and the US are simply difficult to imagine at the current stage. At the recent BRICS summit, the country's leadership pursued a balanced line, avoiding a confrontational stance towards the West. And yet, Brazil is in the crosshairs of US economic sanctions.
The political reasons for declaring a state of emergency in Brazil are clearly spelled out in Trump's July 30 order. Leaving aside the verbal lace, they can be reduced to two points. First, the US is unhappy with the prosecution of former Brazilian President Jair Bolsonaro. The current US Administration considers the prosecution unfounded. Second, Washington is irritated by the Brazilian authorities' policy towards American social networks that, in the authorities' opinion, disseminate false information, as well as US citizens who engage in such activities on social networks.
Trump's decree specifically notes the activities of Brazilian Supreme Court Judge Alexandre de Moraes, who, according to the US Administration, used his powers to suppress the opposition. Interestingly, the US Treasury Department imposed blocking financial sanctions on Judge de Moraes on the same day, using the Magnitsky Global Law as a legal mechanism.
Introducing a 40% duty, the US President clearly threatened that the introduction of retaliatory duties would entail a new increase in US tariffs. On the other hand, solving the problems that gave rise to the decree may also lead to a change in its content. However, a number of goods from Brazil are excluded from the duties. Examples include iron ore, steel, coal, oil, and aircraft. On the one hand, the US itself is no longer interested in duties on these goods, since it needs these imports. On the other hand, the Administration still has room for further escalation.
The sanctions against Brazil are an important milestone, despite their still insignificant volume. In 2019, American political scientists Henry Farrell and Abraham L. Newman proposed an original concept of "weaponised interdependence". The idea is that the United States has created a dense network of economic ties that benefit the participants in such a network. In essence, we are talking about economic globalisation. However, they can also use it for political purposes. For example, the US dollar is beneficial to business as a means of payment. But for political purposes, the United States can "exclude" companies and individuals from different countries from dollar settlements through blocking sanctions. Information channels and social networks are also part of the interdependence networks. A large social network is used by millions around the world. But it can also be used for intelligence gathering, political propaganda, and the promotion of a specific political agenda. A “short circuit” occurs when the political interests of the United States, promoted through a network of economic interdependence, collide with the national interests of a particular country.
Today, we can observe several models for reducing the risks of politicisation of interdependence. Over the past three years, Russia has abruptly severed its ties with the “global network”. China is pursuing a similar policy, but in a smoother manner, avoiding direct confrontation with the United States for now. Countries like North Korea have historically been outside the system. Many states choose to align their interests with the demands of the United States. This allows them to preserve the benefits of globalisation and not enter into conflict without sufficient resources to resist, even at the expense of their sovereignty.
Brazil will obviously face a dilemma in choosing its model. On the one hand, the country is closely integrated into global supply chains and the American-centric financial system. On the other hand, it is a large and growing power with its own national interests and domestic policy. We are unlikely to see a Russian or Chinese scenario. However, Brazil is too big to follow the path of the majority in the long term. Especially if the benefits of participation in globalisation may be reduced, and interdependence with the US may become politicised. It is possible that at some point we will see a special Brazilian model for solving the problem of “weaponised interdependence”.
Views expressed are of individual Members and Contributors, rather than the Club's, unless explicitly stated otherwise.