President Jair Bolsonaro may ask President Joe Biden to reduce import barriers to Brazilian steel for the US, created by former President Donald Trump in 2018. One of the arguments for this is that the current measures end up benefiting Russia.
The two leaders will have a bilateral meeting during the Summit of the Americas, held in Los Angeles this week and which brings together delegations from 34 countries on the continent. The conversation should take place on Thursday afternoon (9).
As a protectionist measure, the US created a 25% surcharge on imported steel, in a measure called Section 232. Brazil, like some other countries, obtained a steel export quota free of this charge, and the claim is now that this limit is increased, abolished or that the country pays a lower rate, according to Brazilian diplomats involved in the preparation of the meeting.
One of the most exported products by Brazil is semi-finished steel slabs, whose current quota is 3.5 million tons per year. The production of these slabs uses metallurgical coal from the USA. Thus, the increase in the quota would also lead to an increase in jobs in states like Virginia, which exports US$ 400 million of the material to Brazil per year, argue Brazilian negotiators.
Diplomats are also seeking support from Democratic lawmakers for the change, which could help convince Biden of the change. Another argument is that the expansion of Brazilian exports could make the US buy less steel from Russia, which remains one of the main suppliers of material for the US industry.
As president, Trump adopted several protectionist measures to contain imports, on the grounds that he intended to preserve US jobs. Biden, who has been in office for a year and a half, still has many of those measures in place.
However, after the pandemic and the War in Ukraine, the United States started talking about near-shoring, a move to bring industries and production chains spread across the planet closer, in a move that can benefit Latin America. The US government hopes that, in addition to improving the region’s economy, it will also help to discourage the migration of Latin Americans to the US.
On Tuesday, the US government announced that ten US companies will make total investments of US$ 1.9 billion in Central American countries. The list of new developments includes fixed broadband and mobile phone networks, expansion of digital payments, clothing and auto parts factories and banana and avocado plantations.
In addition to steel, the agenda for the conversation between the two presidents may include post-pandemic economic recovery, food insecurity and the climate crisis, but the final list of topics will be defined by the two. Regarding the meeting, a White House representative said that it is clear that there are disagreements with the Brazilian government, but that the conversation should be sincere and direct, since the countries have many interests and concerns in common.
Ricardo della Coletta collaborated
