Brazil starts formal process to assess US tariff retaliation

Brazil's Foreign Ministry has ordered trade body Camex to start analyzing whether a local reciprocity law could be used against the United States after U.S. President Donald Trump imposed steep tariffs on several goods from the South American country.

The law, passed earlier this year by Brazil's Congress, establishes a legal framework for Brazil to respond to potential unilateral trade measures targeting its goods and services, including countermeasures such as tariffs.

"A process will be initiated," Vice President Geraldo Alckmin told reporters late on Thursday during a trip to Mexico City. "Congress passed the law almost unanimously. Its an important and necessary instrument."

The move would represent an escalation by Latin America's largest economy in reacting to Trump's 50% tariffs on U.S. imports from Brazil. The country had so far initiated dispute consultations at the World Trade Organization.

Alckmin noted, however, that Brazil remains open to talks with the Trump administration. "I hope this helps accelerate dialogue and negotiation," he said.

Reuters reported earlier on Thursday, citing sources, that Camex had been ordered to launch the process. The move came as President Luiz Inacio Lula da Silva authorized the use of the law against the U.S., the sources said.

Camex has 30 days to present a report on the matter. If it approves the use of the reciprocity law, a government working group will decide which areas Brazil should target in its measures against the U.S., the sources said.

They added that the U.S. is expected to be informed on Friday about the start of the process.

The U.S. imposed 50% tariffs on imports of Brazilian goods this month, as Trump decried what he called unfair trade practices and accused Brazil of a "witch hunt" against former President Jair Bolsonaro, who is on trial on charges of plotting a coup.

Products such as orange juice and aircraft, which are among Brazil's major exports, were exempted from the higher duties.

Brazilian government officials have publicly complained about lack of room to negotiate the tariffs with the U.S. counterparts.