The latest outbreak of creeping global protectionism is in Brazil, which announced March 8 that it intends to levy nearly USD$600 million in increased import duties on more than 100 products made in the U.S. in retaliation for the United States’ failure to comply with a World Trade Organization (WTO) ruling against its subsidies for cotton producers and exporters.
According to “World Trade\INTERACTIVE,” the Brazilian government also plans to impose the first-ever WTO-legal cross-retaliation measures on U.S. intellectual property rights holders that could lead to more than USD$200 million in losses for U.S. companies in the pharmaceuticals, chemicals, biotechnology, and entertainment sectors. To avoid the sanctions, the U.S. Government must settle the WTO case with Brazil before April 7.
The Obama Administration’s much-ballyhooed “National Export Initiative,” which is focused solely on exports and does not promote the two-way, cross-border trade and investment through which open economies have prospered, seems not to have impressed the Brazilians at all. In fact, they announced the new tariffs just as U.S. Secretary of Commerce Gary Locke arrived in Brasilia on a tour to promote exports in the USA’s 10th largest foreign market.
Meanwhile three already-negotiated Free Trade Agreements (with Colombia, Panama, and South Korea), FTAs that actually would increase American exports, sit in Washington—un-pushed by President Obama and un-approved by Congress