US says Brazil's tariff concessions favour India, Mexico in 301 probe

Washington: The United States Trade Representative (USTR), while announcing a 25 per cent tariff on certain Brazilian imports under a Section 301 investigation, cited Brazil's preferential tariff arrangements with India and Mexico as one of the practices disadvantaging American exporters.

The tariffs are scheduled to take effect on July 22.

US Trade Representative Jamieson Greer said late on Wednesday (US local time) that the investigation found that Brazil grants tariff concessions to India and Mexico that are not extended to the United States.


Also Read: US imposing 25% tariff on some Brazilian imports starting July 22, citing unfair trade practices

"We have identified in our investigation that Brazil provides unfair preferential tariffs to India and Mexico for a number of different tariff lines. They offer a certain selection of tariff relief to Mexico and India, and they do not offer the same preferential access to American workers and producers," Greer said.

Greer argued that the differential treatment has affected US exports to Brazil.

"To the extent that they've given this preferential arrangement over a subset of goods, US exports to Brazil have gone down while exports from those other countries have gone up. There's been a very clear correlation between this practice and what happened to our exports," he said.

Asked what Washington expects from Brazil, Greer said the United States wants treatment similar to what Brazil offers India and Mexico.

"What we would expect from the Brazilians is that they give us this type of preferential tariff treatment as well. We're a big trading partner for them... we do want to be able to compete on the best terms, like some of these other countries," he told reporters.

Responding to another question, Greer said the preferential arrangements cover multiple sectors.

Jennifer Thornton, General Counsel at the USTR, said Brazil's bilateral preferential trade agreements with India and Mexico provide producers from those countries lower tariff rates than those applied to US exports.

According to Thornton, the concessions span agricultural products, motor vehicles and auto parts, minerals, chemicals and machinery. She added that the preferential treatment covers "hundreds of tariff lines for India" and "over 1,000 tariff lines for Mexico," with tariff rates ranging from 10 to 100 per cent below Brazil's most-favoured-nation tariffs applicable to US goods.

Also Read: Trump administration proposes 25% tariff to punish Brazil over trade practices

The remarks came as the USTR announced a 25 per cent tariff on certain Brazilian goods following its Section 301 investigation into what it described as unfair Brazilian trade practices, including digital trade barriers, electronic payment services, anti-corruption enforcement, intellectual property protection, ethanol market access and illegal deforestation.