【By Observer Net, Yuan Jiaqi】
According to Xinhua News Agency, US President Trump previously threatened to impose a 50% tariff on goods imported from Brazil starting August 1, and also demanded that Brazil stop the judicial investigation into former President Bolsonaro, which caused strong dissatisfaction in Brazil.
Under the escalating diplomatic tensions, a representative of the Trump administration was reported to have informally suggested to Brazilian authorities that they could open up ownership of rare earth mineral resources through negotiations to exchange for reduced tariffs. The United States is making every effort to increase investment in rare earth production, trying to weaken China's dominant position in this field.
It is known that although this proposal has not been made public, it has raised concerns in Brasilia. Brazilian officials believe that this move is an attempt by the US to exert economic pressure and force Brazil to make concessions in strategic areas.
President Lula of Brazil has repeatedly publicly refused any American attempts to covet control over Brazilian mineral resources. On Monday (28th), during an energy event in Rio de Janeiro, he mentioned the leaked content and mocked Washington as "opportunistic."
"Recently I saw a report saying that the US is very interested in key minerals in Brazil," he said, adding that these minerals have now become "key," "so I need to keep them myself. Why should others take them away?"
He added that any company conducting mineral exploration in Brazil must obtain national authorization, and cannot sell or transfer related rights without government approval.
"70% of our territory and resources have not been explored yet. Companies conducting exploration must obtain authorization, and are under the supervision of the government throughout the process," Lula emphasized. "Once we authorize a company, it cannot sell the minerals without consulting the government, let alone sell off the mineral areas. These resources belong to the Brazilian people. They should be entitled to the value these resources can create."
Lula also announced the establishment of a government committee responsible for exploring the country's natural resources.
It is reported that Brazil is preparing a national policy on key minerals, expected to be launched before November. Sources revealed that this government proposal was initially called the "Clean Energy Minerals Program" (MEL), and is still in the preliminary stage, but a document in the form of a presidential decree has already been drafted.
During the event, Lula also addressed Trump directly, urging him to "acknowledge Brazil's importance."
"I hope the US president can act in a civilized way: when there are differences, sit down and talk, set aside differences, and solve problems together, instead of suddenly imposing a 50% tariff on Brazil unilaterally," he said.
Lula called the tariff issue "very painful," because "the relationship between Brazil and the US is crucial," and reiterated Brazil's willingness to negotiate.
"Brazil hopes to negotiate in a calm manner. We have no disputes with any country. We don't want conflicts, we just want to do business," he said.
Local time on July 28, President Lula of Brazil gives a speech at the inauguration ceremony of a power plant. Screenshot of the video
Lula's statement comes amid increasing diplomatic activities between Brazil and the US regarding key minerals. Last Wednesday (23rd), officials from Brazil's mining sector met with the acting ambassador of the US embassy in Brazil, Escobar, in Brasilia to discuss potential cooperation agreements and tariff issues between the two countries.
The meeting was proposed by the US side, marking the third time this year that both sides have held talks on key minerals. During the meeting, Brazil's mining sector proposed sending a delegation to the US to directly negotiate with the US government and mining companies, and Escobar welcomed this, but the visit is expected to take place as early as September.
The progress of the negotiations depends on Brazil's industrial strategy. According to Raúl Jungmann, president of the Brazilian Mining Association (IBRAM), the Brazilian Constitution prohibits foreign companies from directly extracting underground resources and minerals within the country, but allows international cooperation under the premise of complying with Brazilian regulations, such as establishing joint ventures, reaching technical agreements, transferring knowledge, and conducting joint research.
Currently, China is the main buyer of Brazilian minerals, with about 70% of Brazilian mineral exports going to the Chinese market. With the US striving to reduce its dependence on Chinese rare earths, the strategic importance of key minerals has become increasingly prominent, and Brazil, which has the world's second-largest known reserves of rare earths, is gradually becoming an important option.
A recent study by the China-Brazil Business Council (CBBC) showed that in the first half of this year, the export of rare earth compounds from Brazil to China reached $6.7 million, doubling compared to the same period last year. Analysts believe that the surge in export value reflects China's efforts to diversify key mineral resources and reduce environmental costs in domestic processing.
As the deadline for the tariff implementation on August 1 approaches, Brazil's foreign affairs department is intensifying its efforts. It is reported that Brazil's Foreign Minister, Viera, arrived in the US on Sunday and will attend a meeting at the UN headquarters in New York. He stated that if the Trump administration is willing to restart negotiations, he would go to Washington.
At the same time, a delegation of eight Brazilian senators remains in Washington, holding meetings with US legislators, business leaders, and civil society groups. The delegation plans to stay until Wednesday and seeks to meet with US Commerce Secretary Rutenberg.
On Monday, Senator Carlos Vianna, who accompanied the delegation to the US, told reporters that the "main reason" for the US imposing tariffs was Brazil's participation in the BRICS mechanism.
Vianna told reporters, "This is what I found out when I met with Republican representatives in Florida. The US does not agree with Brazil's position in BRICS, believing that BRICS is no longer just an economic group." He also mentioned that the US "does not want to see Brazil cooperate with China in military and geopolitical fields."
Earlier, informed sources also said that Trump's core frustration was the long-term "de-dollarization" efforts of the BRICS. On the 27th, Selso Amorim, Brazil's chief special advisor and former foreign minister, said that Trump's actions would only make Brazil double its commitment to the BRICS.
"This actually strengthens our relationship with BRICS, because we want to build a diversified relationship rather than relying on any single country," Amorim emphasized. He stated that BRICS is not an ideological group, and Brazil will strengthen relations with European, South American, and Asian countries. This statement is seen as a "disregard" of Trump's tariff threat.
On July 28, regarding the US's plan to impose tariffs on Brazil, Chinese Foreign Ministry spokesperson Guo Jiajun stated at a regular press conference that the tariff war has no winners, and unilateral actions do not benefit any party. China is willing to work with a wide range of Latin American and Caribbean countries, as well as BRICS countries, to jointly safeguard the multilateral trading system centered around the World Trade Organization and defend international fairness and justice.
In addition, as the third largest civilian aircraft manufacturer in the world after Airbus and Boeing, Embraer is one of the Brazilian companies most affected by the tariffs. Embraer's revenue heavily depends on the US market, and transportation equipment, especially airplanes and airplane parts, account for a significant share of Brazil's exports to the US. The US is Brazil's largest export destination for aircraft.
After Trump issued the tariff threat to Brazil, the Brazilian real fell nearly 3% against the dollar, and Embraer's American depositary receipts dropped by 9% in after-hours trading. The company's CEO, Francisco Neves, said last week that the tariffs would increase the cost of each plane purchased by US airlines by $9 million.
On local time July 28, Neves told local media that he expects the US tariffs may cause order cancellations and layoffs, resulting in billions of dollars in losses for the company.
"What can China do to open up the market for products like airplanes to Brazil?" Guo Jiajun also said at the press conference that China values practical cooperation with Brazil in areas such as aviation and is willing to promote such cooperation based on market principles to help the development of both countries.
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