Peru backtracks on Brazil’s textile surcharge

RIO DE JANEIRO, BRAZIL – After 7 months of investigation, Peru has backtracked in surcharging textile imports (clothing and bed, table and bath products) from Brazil. The decision was announced yesterday, June 22, by the Ministries of Economy and Foreign Affairs.

In a joint note, the portfolios informed that the safeguard would have a negative impact on Brazilian exports and that Brazil was able to prove, with textile sector entrepreneurs, that national exports do not affect Peruvian producers.

“The Brazilian government took part in all stages of the investigation, in defense of the interests of national exporters. Brazil’s positions were added to the manifestations of other countries and business sectors in favor of the non-application of measures. Ultimately, the Peruvian authority found that the technical conditions for the adoption of safeguards were not provided,” the statement said.

The safeguards aim to temporarily increase protection to an economic sector suffering losses caused by competition from imports, until local producers adjust. The application of the measure is supported by World Trade Organization rules, provided the country enforcing such measure can prove losses from unfair trade practices.

According to the Ministries of Economy and Foreign Affairs, Peru is the 7th destination for exports from the textile sector. In 2019, according to the two portfolios, Brazilian sales of these products to the neighboring country totaled US$3.3 million.