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<\/iframe><\/div>\n<div id=\"article-body\">\n<p>Brazil\u2019s leftwing president is standing firm against Donald Trump\u2019s 50 per cent tariff threat, as Luiz In\u00e1cio Lula da Silva seizes the confrontation with Washington to revive his re-election prospects. <\/p>\n<p>After the US president jolted Brazil on Wednesday with a letter citing political justifications for imposing supercharged duties, Lula immediately promised to retaliate, saying his nation \u201cwould not be tutored by anyone\u201d. <\/p>\n<p>The foreign ministry also summoned the acting US ambassador and returned Trump\u2019s \u201cinsulting\u201d tariff letter to him. Bras\u00edlia views the Trump threat as blatantly political, given the US has a trade surplus with Brazil. <\/p>\n<p>Trump\u2019s letter, which outlined the highest updated \u201creciprocal\u201d tariff of any country, described former hard-right president Jair Bolsonaro\u2019s trial on charges of plotting a coup as a \u201cwitch-hunt\u201d and accused Brazil\u2019s supreme court of issuing \u201csecret and unlawful censorship orders\u201d against US social media companies.<\/p>\n<p>One senior official in Bras\u00edlia said the Lula government would stand firm in the face of Trump\u2019s threats. \u201cIt\u2019s an attack on Brazilian democracy,\u201d he said. \u201cThere\u2019s no negotiation possible on this.\u201d<\/p>\n<p>Brazil\u2019s real fell by more than 2 per cent on Trump\u2019s threat, which would hit exports of Brazilian aeroplanes, coffee, orange juice and crude oil if implemented from August 1. \u201cIf this 50 per cent tariff scenario becomes long-lasting, Brazil\u2019s GDP could potentially be reduced by 0.8 per cent to 1.2 per cent,\u201d said Vinicius Moreira at JPMorgan in a note to clients.\u00a0<\/p>\n<p>But even the normally staid pro-business newspaper Estad\u00e3o de S\u00e3o Paulo described Trump\u2019s threat as a \u201cmafia thing\u201d and called on \u201cthose who are truly Brazilian\u2009.\u2009.\u2009.\u2009not to allow themselves to become lackeys\u201d of the US president.<\/p>\n<figure class=\"n-content-image n-content-image--full\" data-component=\"image-set\"><picture><source media=\"(min-width: 700px)\" srcset=\"https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3A4b904dfe-0db9-492f-aace-fc0a3b15dd90?source=next-article&fit=scale-down&quality=highest&width=700&dpr=1 1x,https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3A4b904dfe-0db9-492f-aace-fc0a3b15dd90?source=next-article&fit=scale-down&quality=highest&width=700&dpr=2 2x,https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3A4b904dfe-0db9-492f-aace-fc0a3b15dd90?source=next-article&fit=scale-down&quality=highest&width=700&dpr=3 3x\" width=\"2290\" height=\"1526\"\/><\/picture><figcaption class=\"n-content-picture__caption o3-editorial-typography-caption\"><span>Jair Bolsonaro<\/span><span> <!-- -->\u00a9 Arthur Menescal\/FT<\/span><\/figcaption><\/figure>\n<p>Lula\u2019s supporters flooded social media with nationalist messages accusing Bolsonaro\u2019s family, which <a href=\"https:\/\/www.ft.com\/content\/577d44af-c3b2-4741-9eba-b348e0fc4ea6\" data-trackable=\"link\">has been waging a lobbying campaign in Washington<\/a> against Lula\u2019s government, of selling out their own country.<\/p>\n<p>\u201cNow you will have to decide whether you are on Trump\u2019s side or Brazil\u2019s side,\u201d said leftwing deputy Guilherme Boulos in a fiery speech. \u201cThat Trump tax now has a name\u2009.\u2009.\u2009.\u2009it is the Bolsonaro tax\u201d.<\/p>\n<p>Lula\u2019s government had been flagging in the polls, as the 79-year-old leftist struggled to convince voters hit by high food inflation that he could make them better off. But Trump\u2019s aggressive attack on Brazil has breathed fresh life into an unpopular government\u2019s efforts to win re-election, a phenomenon already seen in Canada.<\/p>\n<p>\u201cLula is back in the game,\u201d said Thomas Traumann, a political analyst in Rio. \u201cTwo weeks ago there was a consensus that the opposition were the favourites, but no longer. If the elections were this year, I have little doubt that Lula would win.\u201d Brazil chooses a new president in October 2026.<\/p>\n<p>The magnitude of Trump\u2019s tariff threat even took by surprise some Brazilian rightwingers who have been calling for US sanctions against Alexandre de Moraes, the supreme court judge overseeing the Bolsonaro case. One ally of the US-based Bolsonarista lobbying camp said: \u201c[They] never asked for anything at this scale, nor expected it\u201d.<\/p>\n<p>The conservative opposition appeared unsure how to respond to the draconian tariff threat, even as the left flooded the internet with memes of rightwing leaders such as S\u00e3o Paulo governor Tarc\u00edsio de Freitas wearing Make America Great Again caps.<\/p>\n<p>CNN Brasil reported that Bolsonaro, alarmed by the possible electoral blowback, was considering asking the White House to reverse the tariff threat.<\/p>\n<p>Brazil is already heavily dependent on trade with China, its biggest trading partner, and has few options for diversification. Its hopes of securing ratification of a long-planned free trade deal between the EU and the Mercosur bloc of South American nations are fading after fierce opposition from European farmers.\u00a0<\/p>\n<p>France is demanding that only produce made to EU standards should be allowed to benefit from tariff reductions, which would require changing the treaty and would be rejected by\u00a0Latin American countries.<\/p>\n<p>Poland, Italy and the Netherlands also want more protection for farmers. The European Commission has yet to send the deal to member states despite promising to before the summer.<\/p>\n<p>In Brazil\u2019s corporate world, which has soured on Lula\u2019s tax-and-spend economic policy, there was a mood of wariness. <\/p>\n<p>Caio Megale, chief economist at XP Investimentos, said while the overall macroeconomic effect would be limited, a bigger concern for investors was the political uncertainty. \u201cThe first impact was an increase in the perception of risk. It creates disproportionate noise.\u201d<\/p>\n<p>\u201cThis episode shows that polarisation in Brazil is far from over and the 2026 election will be very tight,\u201d said Ricardo Lacerda, chief executive of investment bank BR Partners. \u201cThis movement creates flags for the radical wings of the right and the left. The loser is Brazil.\u201d <\/p>\n<\/div>\n\n<br \/><a href=\"https:\/\/www.ft.com\/content\/e050c645-58ea-4a37-bedf-f4418f2f89fd\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Unlock the White House Watch newsletter for free Your guide to what Trump\u2019s second term means for Washington,…\n","protected":false},"author":5,"featured_media":34078,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[],"class_list":["post-34077","post","type-post","status-publish","format-standard","has-post-thumbnail","category-us","cs-entry","cs-video-wrap"],"_links":{"self":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/34077","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=34077"}],"version-history":[{"count":0,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/34077\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/media\/34078"}],"wp:attachment":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=34077"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=34077"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=34077"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}