US President Donald Trump has announced, via Twitter, that he will be restoring tariffs on all steel and aluminium currently shipped to the US from Brazil and Argentina. In a tweet posted on the morning of 2 December, President Trump states that Brazil and Argentina “have been presiding over a massive devaluation of their currencies” which is “not good for our farmers”.
He added: “The Federal Reserve should likewise act so that countries, of which there are many, no longer take advantage of our strong dollar by further devaluating their currencies. This makes it very hard for our manufacturers and farmers to fairly export their goods.”
According to a report by the Financial Times, the move by President Trump will escalate trade tensions with the two Latin American economies, as they work more closely with China. The initial announcement caused significant drops in the stock market. The FT report states that the US president originally announced the metals tariffs on national security grounds in 2018, however, he then exempted some US allies following complaints from domestic consumer sand ‘heavy diplomatic backlash’ from affected countries.
Brazil and Argentina were initially protected from the tariffs, worth 25% on steel and 10% on aluminium, but President Trump’s tweet abruptly restored the tariffs. Aluminium and steel remain the most commonly used material in aerosol manufacturing.