Trump’s New Tariffs and the Reshaping of Global Supply Chains: Strategic Openings for Brazil
In March 2025, former U.S. President and current Republican front-runner Donald Trump unveiled a campaign platform centered once again on aggressive trade protectionism. His proposed plan includes tariffs of up to 60% on Chinese imports and 10% across all goods from the European Union, under the stated goal of protecting American jobs and industries.
While the full implementation of these measures still requires congressional approval, the signal alone is already reverberating through global markets. Multinationals are reevaluating supply chains, and trade-dependent economies are recalculating exposure risks and seeking new trade routes and partners.
Global Trade Impacts: Key Projections
According to the Peterson Institute for International Economics, a broad tariff escalation could:
Reduce global trade flows by up to $1.4 trillion over the next four years
Cut Chinese exports to the U.S. by $300 billion in the first year alone
Lower the European Union’s GDP by up to 0.7% annually
At the same time, the U.S. economy itself may face inflationary pressures, rising input costs, and disruptions in key industrial sectors.
Brazil: Rising as a Strategic Alternative
In this shifting landscape, Brazil emerges as a uniquely positioned investment destination—outside the direct line of fire, yet rich in industrial, agricultural, and mineral potential. Some of the key comparative advantages include:
Preferential market access through Mercosur, ongoing EU-Mercosur trade negotiations, and participation in blocs such as BRICS
Competitive industry base in sectors like agribusiness, steel, fertilizers, paper & pulp, energy, and textiles
Stable macroeconomic outlook, with inflation projected at 3.9% for 2025 and interest rates trending downward from the current 10.75% Selic
Structurally undervalued currency, enhancing export competitiveness and increasing the appeal of Brazilian assets to foreign investors
Foreign Direct Investment: On the Rise
Brazil attracted $66.6 billion in Foreign Direct Investment (FDI) in 2023. According to UNCTAD, FDI inflows are expected to grow by over 20% in 2025, driven by reinvestment and new allocations in infrastructure, clean energy, and agritech.
Where Opportunities Are Emerging
Import substitution industries: Brazilian firms can step in to replace penalized suppliers from the EU and China
Commodity-based investments: Brazil continues to lead in global food security, renewable energy, and critical minerals
Nearshoring potential: As companies move supply chains closer to consumption hubs, Brazil offers low geopolitical risk and growing integration
Export-driven infrastructure: Investments in logistics, ports, warehousing, fertilizer production, and hydrogen gain momentum
Key Developments to Monitor
Legislative decisions in the U.S. Congress on tariff implementation
Retaliatory trade actions from the EU and China
Brazilian currency dynamics and bilateral trade agreements
Structural reforms in Brazil to capitalize on this strategic moment
At Latitude3, we understand that in a world of volatility and fragmentation, investment decisions must be anchored in clarity, timing, and local expertise. We help international investors navigate Brazilian opportunities with a long-term, intelligent approach.
Latitude3 — Precision. Purpose. Perspective.
Contact our team to explore how to position your capital in this new global trade environment.
