On Monday the 9th November Brazil will publish a preliminary list of U.S. goods it intends to hit with trade sanctions in retaliation for Washington’s cotton subsidies, a senior government official told Reuters.
The move is the strongest indication yet that Brazil intends to levy trade sanctions on Washington in the long-standing cotton dispute, which diplomats say could sour bilateral relations.
“If the United States does not change its position, we will retaliate,” Lytha Spindola, executive secretary of the government’s foreign trade chamber Camex, said in an interview on Friday.
In August the World Trade Organization set out terms for Brazil to retaliate against U.S. cotton subsidies, including marketing loans and counter-cyclical payments.
Brazil says it is entitled to some $800 million in sanctions this year, including $340 million in cross-retaliation. The United States has estimated sanctions at about $300 million with no cross-retaliation.
The list would include 120 items worth between $1.5 billion and $2 billion annually, Spindola said. Following consultations and public hearings, the list would be cut back to represent a value of around $800 million.
By year-end the list would also include sanctions on patents and other intellectual property rights. The government was preparing legislation to strengthen its case for such a measure, Spindola said.
The actual value of the sanctions would depend on how much the U.S. government spends on cotton subsidies this year.
In September Brazil said it would request data on the size of U.S. export credits in the current year.
That request followed a visit by U.S. Trade Representative Ron Kirk to Brazil, during which he said the United States welcomed Brazil’s offer to discuss the stand-off but would wait for Brasilia to decide on possible countermeasures.
Reporting by Raymond Colitt
Editing by Xavier Briand
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