According to a study by the Federation of Industries of the State of Minas Gerais (FIEMG), President Trump's tariffs on Brazilian products exported to the United States will endanger over 618,000 jobs in Brazil over the next decade.

As per Zhongjin's understanding, industrial enterprises will face the most severe impacts. These tariffs are expected to result in economic losses, negatively affecting wages, employment, and household consumption. This will not only impact businesses selling products to the United States but also affect the entire regional economic chain.

Starting from August 6th, the United States has begun imposing a 50% tariff on products imported from Brazil, including machinery, coffee, meat, wood, firearms, and footwear. However, certain goods such as oil, aircraft, and orange juice are not affected by the tariffs.

According to the study, Brazil's exports to the United States reached $40.4 billion in 2024, accounting for 12% of the total exports. The total export value of affected products is around $22.2 billion, representing 54.9% of exports to the United States.

The study indicates that these tariffs could lead to a short-term decrease of 0.22% in Brazil's Gross Domestic Product (GDP), equivalent to 258 billion reais, and a long-term loss of 0.94%, equivalent to 1.1 trillion reais. In the short term, over 146,000 formal and informal job positions may be at risk; in the long term, this number could exceed 618,000.

Industries such as steel and seamless steel, wood products, as well as footwear and leather goods manufacturing, will face the greatest impact in the short term, resulting in an 8.11%, 7.12%, and 3.07% decrease in income, and an 8.08%, 6.69%, and 2.44% decrease in employment, respectively.

Some businesses have already started feeling the effects and taking action. For instance, Taurus, a company producing weapons and ammunition, will relocate its main assembly line to the United States; Randa, a wood products manufacturer, has approved collective vacations and halted half of its production.

Brazilian President Lula has proposed a series of relief measures, including providing 30 billion reais in credit lines to support affected businesses and others seeking to expand exports, aiming to diversify trade balance and reduce dependence on the U.S. market.

The study authors state that these measures will help businesses, but it is crucial to strengthen negotiations with the United States to lower tariffs. Ignoring markets like the United States is not a strategic decision; negotiations must be advanced to reduce tariffs while expanding business relations with other countries.