US proposes tariffing Brazil and 59 economies for failure to combat forced labor

The USTR (United States Trade Representative) proposed, in a document released on Tuesday night (2), the imposition of additional tariffs on products from Brazil and 59 other economies that had failed to take measures against the trade in goods derived from forced labor.

The US decision comes one day after the Trump administration's trade body suggested a 25% tax on all imports from Brazil.

In Tuesday's statement, the American government states that these countries fail to impose and effectively enforce a ban on the import of goods produced with forced labor.

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The USTR proposes additional tariffs on all products from the economies investigated.

For economies that impose a ban on the import of products derived from forced labor, that have committed to imposing and enforcing such a ban, or for economies that have imposed a partial regime with the effect of preventing the import of such products, the USTR proposes a 10% additional tariff rate. This is the case of Canada, Ecuador, Indonesia, Mexico, Pakistan and the European Union.

For all other economies, it proposes a rate of 12.5% for additional fees. This group is made up of Brazil, Argentina, China, Japan, United Kingdom, Russia, among other countries.

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The U.S. Trade Representative also proposes a textile mechanism that would allow a certain volume of apparel and textile imports from certain economies to enter the United States at a reduced Section 301 tariff rate.

"The failure of our most important trading partners to address the import of goods produced with forced labor is unacceptable. It creates a dynamic in which American workers are forced to compete globally on an unequal playing field," said Ambassador Jamieson Greer.

"We will no longer tolerate this disparity. Some trading partners have already taken initial steps to prevent the import of goods produced with forced labor, including through the USMCA and commitments in Reciprocal Trade Agreements. However, each of our trading partners must do more to ensure that trade does not encourage and perpetuate forced labor globally."

The US report finds that all 60 economies investigated failed both to impose a ban on the import of forced labor and to effectively enforce such a ban.

As a result of these investigation findings, the US Trade Representative proposed corrective action for public consultation. Hearings on the proposed actions are scheduled for July 7th.

According to the USTR, the following 54 economies have failed to impose or effectively enforce a ban on the import of goods produced with forced labor (12.5% additional tariff):

- South Africa
- Saudi Arabia
- Algeria
- Angola
- Argentina
- Australia
- Bahamas
- Bahrain
- Bangladesh
- Brazil
- Cambodia
- Qatar
- Chile
- China
- Singapore
- Colombia
- South Korea
- Costa Rica
- Egypt
- El Salvador
- United Arab Emirates
- Philippines
- Guatemala
- Guyana
- Honduras
- Hong Kong
- India
- Iraq
- Israel
- Japan
- Jordan
- Kazakhstan
- Kuwait
- Libya
- Malaysia
- Morocco
- New Zealand
- Nicaragua
- Nigeria
- Norway
- Oman
- Peru
- United Kingdom
- Dominican Republic
- Russia
- Sri Lanka
- Switzerland
- Taiwan
- Thailand
- Trinidad and Tobago
- Turkey
- Uruguay
- Venezuela
- Vietnam.

The following six economies were unable to effectively implement a ban on the import of goods produced with forced labor (10% additional tariff):

- Canada
- Ecuador
- Indonesia
- Mexico
- Pakistan
- European Union

Source: CNN