Finance

Finance

Brazilian government announces trade sanctions against USA

09 March 2010 15:29 (UTC +04:00)

Baku â€“ APA-Economics. The Brazilian government has announced trade sanctions against a variety of American goods in retaliation for illegal US subsidies to cotton farmers.
The World Trade Organization (WTO) approved the sanctions in a rare move.

Brazil published a list of 100 US goods that would be subject to import tariffs in 30 days, unless the two governments reached a last-minute accord.

It said it regretted the sanctions, but that eight years of litigation had failed to produce a result.

It said it would raise tariffs on $591m (Â£393m) worth of US products - from cars, where the tariff will increase from 35% to 50%, to milk powder, which would see a 20% increase in the levy.

US farm subsidies are condemned worldwide. This archaic practice must stop

Cotton and cotton products would be charged 100% import tariff, the highest on the list.

The Office of the US Trade Representative said it was "disappointed" by Brazil’s decision and called for a negotiated settlement.

Critics say the US has given its cotton growers an unfair advantage by paying them billions of dollars each year.

In 2008, the WTO ruled that subsidies to US cotton producers were discriminatory.

Government subsidies for local producers should only be allowed in response to short term need after natural disasters or periods of serious economic hardship