Amid trade war, Haddad says Brazil wants to maintain open dialogue with the US and China

Finance Minister Fernando Haddad said that Brazil intends to maintain an open dialogue with the United States and China, amid the trade war between the two largest powers on the planet since Donald Trump returned to the White House. For the head of the economic team of the Lula (PT) government, Brazil is too big to be a “satellite” of any other country.

During an event organized by Banco Safra on Monday 28, Haddad said that the current state of the trade conflict “is an opportunity for Brazil to assert its commercial diplomacy and obtain bilateral advantages.”

“Brazil maintains communication channels for agreements with China, the European Union and the United States. This is not new,” he said. “ Non-alignment means maintaining open channels with three major blocs. This is a policy agreed upon with President Lula, who is a great asset to the country in terms of diplomacy,” the minister continued.

In any case, according to Haddad, the moment requires caution. “The degree of uncertainty about what the end point of this turbulence that has been caused will be is still great. There have been many comings and goings so far in a period of weeks. So, we have to wait a little, be cautious, I would say,” said the minister.

From the point of view of relations with the US, Brazil – through Itamaraty and the Ministry of Industry, Commerce and Services – has called the North American commercial sector to talk, trying to reduce the tariffs applied to Brazilian products, especially steel and aluminum, which are subject to 25% taxes imposed by the US.

“Brazilian imports from countries with significant levels of overcapacity, specifically China, have grown tremendously in recent years, more than tripling since the institution of this quota agreement,” says an excerpt from an executive order published by the Republican administration.

According to Haddad, the current tariffs open the way for “regionalization.” “If this is the trend, I think Brazil could support this type of movement, which could benefit us because we represent half of the economy of South America,” said the minister.

When calculating the risks and opportunities generated for Brazil by the trade dispute, the government is also weighing the course of the trade agreement between Mercosur and the European Union (EU). Organizations such as the Brazilian Trade and Investment Promotion Agency (Apex) have already said that Trump's tariffs could speed up the implementation of the agreement, but France, a regular focus of resistance to the deal, has already signaled that it is “not a cure” for the negotiation.

At the negotiating table, Haddad said he saw Europe open to the agreement. “I spoke with the French Finance Minister [Éric Lombard] and saw a greater openness,” revealed the minister, who attributes the progress in the talks to the fact that Brazil has gained credibility in the international market by adapting to the good transparency and governance practices of the Organization for Economic Cooperation and Development (OECD), the club of the world’s leading economies.