Brazilian industry warns U.S. tariffs could slow exports, investment

BRASILIA, Aug. 20 (Xinhua) -- U.S.-imposed tariffs on Brazilian products could cause a drop in the country's exports for the first time in 21 months, while also negatively impacting investment and employment, the National Confederation of Industry (CNI) warned in a report on Wednesday.

According to the CNI's latest survey, export expectations for Brazil's industrial sector for the next six months fell 5.1 points to 46.6 points in August. When the indicator falls below 50 points, it indicates an expected contraction in exports.

"The worsening of export expectations is closely related to uncertainties in the external environment, mainly due to the new U.S. trade policy," said Isabella Bianchi, CNI's policy and industry analyst.

A 50 percent tariff imposed by the U.S. government on a number of Brazilian products took effect on Aug. 6.

According to the CNI, the measure is already having an impact on industrial employment, which declined in July despite a rise in production growth.

The employment expectations index dropped to 49.3 points in August, signalling that employers do not anticipate job growth in the next six months.

Business owners are less inclined to invest. "The investment intention index fell to 54.6 points, the lowest level since October 2023. However, it remains 2.1 points above the historical average of 52.5 points," the report noted. ■