Brazil Imposes Non-Tariff Barriers on 86% of Imports, Well Above Global Average

Brazil imposes non-tariff barriers (NTBs) on 86.4% of its imports, a significantly higher rate than the global average of 72%. This situation could leave the country vulnerable amid a potential trade investigation by the United States.

This is according to a study by BTG Pactual, which used data from the World Bank’s WITS (World Integrated Trade Solution) platform. The platform calculates an indicator measuring the share of a country’s imports subject to non-tariff restrictions.

Such restrictions, which serve to protect domestic producers from foreign competition, include technical specifications (such as certification and labeling requirements), prior licensing, sanitary controls, and import quotas.

BTG’s study found that, among 12 countries analyzed, Brazil ranked fourth in terms of the highest “coverage index” — a technical term referring to the share of imports affected by NTBs.

In Latin America, Brazil is second only to Argentina, which tops the ranking with 94.6% of its imports subject to NTBs. The European Union and Canada follow in second and third places, with 94.3% and 88.9% respectively. The United States ranks fourth with 77.1%.

“In practical terms, most imported products face restrictions such as prior licensing requirements, strict sanitary inspections, and technical standards enforced by agencies such as Inmetro and Anvisa, as well as quotas or quantitative limits,” wrote analysts Iana Ferrão and Pedro Oliveira.

The data show that 67.7% of Brazilian imports are subject to certification requirements, and 67.36% are subject to labeling requirements. Approximately 39% of imports are subject to quotas.

This scenario, combined with Brazil’s weighted average import tariff of 5.8%, compared to 1.3% in the U.S., positions Brazil as a highly protectionist country.

“Brazil stands out as one of the countries that imposes the highest tariff and non-tariff barriers on U.S. products,” the study noted. “Potential trade negotiations with the U.S. will likely need to consider gradually reducing some of these barriers as a bargaining tool to mitigate negative impacts on specific sectors and Brazil’s trade balance.”

The study also suggests that Brazil’s closed economy is more a result of domestic regulatory barriers than high tariffs alone.

“Many domestic sectors are shielded by regulations and requirements that significantly hinder foreign competition, even when tariffs are not particularly high,” the analysts noted.

Examining sector-specific barriers, the study identified the most restricted sectors as vegetables, electrical machinery and equipment, food products, and animal products, all of which have 100% of their imports subject to non-tariff barriers.

“If Brazil is forced to reduce NTBs, sectors that rely heavily on basic inputs — as well as those related to apparel, machinery, and semi-finished goods — would be the most exposed and potentially harmed,” the study concludes.

BTG Pactual estimates that if the 50% tariff increase announced by U.S. President Donald Trump is implemented, Brazil could lose US$7 billion in exports in 2025 and US$13 billion in 2026.

Welber Barral, former Secretary of Foreign Trade and partner at Barral Parente Pinheiro Advogados, noted that Brazil’s NTBs apply to all countries, not just the U.S.

Bilateral complaints, he said, come mainly from U.S. sectors that are major buyers of Brazilian goods. “Compared to trade relations between the U.S. and Mexico, the dispute with Brazil is relatively small,” Barral said.

“The U.S. often complains about Brazil’s 18% ethanol import tariff, regulatory barriers from Anatel (telecommunications agency), the prohibition on remanufactured goods, and preferential treatment for domestic fuels under the Renovabio program,” he added.

Brazil, for its part, criticizes U.S. tariffs on sugar, orange juice, and meat — all major exports to the American market.

According to Barral, if the U.S. goes ahead with the 50% tariff on Brazilian products, much of the country’s exports to the U.S. would become unviable. “This is especially true for commodities. But it would also fuel inflation in the U.S., particularly for orange juice, meats, and coffee,” he said.

He also stressed that Brazil’s complex tax system and bureaucracy hinder greater trade openness.

“Imports in Brazil are subject to multiple taxes, including PIS/Cofins, ICMS, and IPI. This is not just bad for the U.S. — it’s bad for Brazil too,” Barral said.

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Source: Diário do Comércio

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