Chile, Peru anxiously await word on Trump's proposed 50% copper tariff
Chile could be hit hardest -- its copper makes up 35.7% of total U.S. copper imports.
Copper prices in New York rose an average of 12% after the news, potentially boosting short-term revenues. But analysts warn that if the tariff goes into effect, U.S. demand could drop, pushing prices down and cutting into producer earnings.
The proposal was met with caution in both South American countries, as the economic impact could affect trade balances and fiscal stability.
Chile could be hit hardest -- its copper makes up 35.7% of total U.S. copper imports. In Peru, the immediate effect is expected to be more limited, with the U.S. accounting for just 2.4% of its copper exports.
Although the United States is not the primary destination for Chilean copper, Chile exported about $6.3 billion worth to the The United States in 2024, accounting for 12.8% of its total copper exports.
Chile's state-owned mining company, Codelco, has launched an internal review to assess how the tariff could affect its operations and trade strategy.
"It's still unclear whether the tariff will apply to all copper products or if exceptions will be made for countries like ours," Codelco Chairman Máximo Pacheco said.
A potential drop in copper exports to the United States would reduce foreign currency earnings and tax revenue at a time when Chile having faced a fiscal deficit of 2.9% of gross domestic product in 2024 and public debt climbing to 42% of GDP, according to Manuel Viera, president of the Chilean Mining Chamber.
"If the U.S. stops being a profitable destination, Chile will need to find alternative markets. Even though Chile exports globally, a sharp increase in U.S. prices could lead to oversupply elsewhere, pushing prices down," said Jorge Montes, a mining law expert.
The uncertainty surrounding the proposed tariff could discourage new investment in Chile's mining sector, said Humberto García, president of the Chilean Institute of Public Policy.
"If mining companies scale back operations or pause projects, that could have a negative impact on both direct and indirect employment in a sector that drives the economy across several regions of the country," he said.
In Peru, the direct impact would likely be more limited. In 2024, the country exported about $705 million in copper to the United States. However, higher-value shipments could take a bigger hit, with about $900 million in cathodes and wire sent to the United States, Peru's second-largest market.
"It's not yet clear if the tariff would target only raw copper or also include manufactured goods," said Rafael Zacnich, head of economic studies at ComexPerú. He noted that previous cases have included exemptions for countries like Canada and Mexico.
"If they're excluded and we're not, we'll be pushed out of the market," he told the Peruvian daily Gestión.
Experts say global demand for copper is unlikely to slow despite U.S. protectionism, meaning Peru could redirect exports to other markets. Still, government officials and trade groups -- including ComexPerú -- have called for action to secure an exemption for Peru under its free trade agreement with the United States.
Chile remains the world's top copper producer, and the metal is its leading export, totaling $50.86 billion in 2024, according to the Central Bank. Peru ranks third globally, with copper accounting for nearly 30% of its exports, totaling $23.45 billion last year.
After two hundred years of robbing Latin America blind of its natural resources, President Trump doubles down. If anything, this will ensure millions more asylum seekers fleeing poverty to the USA.
Poll: More people in Canada, Mexico view U.S. as top threat not ally
According to the survey, 59% of Canadians and 68% of Mexicans view the United States as their countries' greatest threat. Meanwhile, 55% of Canadians and 37% of Mexicans view their neighbor as their most important ally.
The figures come from a survey that asked people from across the globe which countries have the most important relationship and which constitute the greatest threat to their own.
Of the 24 non-U.S. countries included in the survey, 12 said the United States was their country's most important ally, including Israel (95%), South Korea (89%), Japan (78%), Britain (51%), Poland (43%), Italy (42%), Australia (35%) and India (35%). The United States tied as the top ally with other countries in Kenya (38%), Nigeria (30%) and Hungary (23%).
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Several countries that consider the United States their top ally also view the country as their biggest threat. Canada was the most divided with 55% of people seeing the United States as a top ally and 59% seeing it as the biggest threat. Argentina, Brazil, Kenya and Mexico similarly had polarized views of the United States.
Three other countries -- South Africa (35%), Indonesia (40%) and Spain (31%) -- also viewed the United States as a top threat, but didn't have such a favorable view of the country to balance that out.
The country with the most favorable view of the United States was Israel, with 95% viewing it as an ally and 1% viewing it as a threat. Mexico, meanwhile, had the least favorable responses, 37% viewing the United States as an ally and 68% a threat.
Six countries -- Germany, France, Sweden, Greece, the Netherlands and Turkey -- didn't consider the United States either their top ally or top threat.
People in the United States were most likely to view China and Russia as their country's top threat, with Republicans more likely to be wary of China and Democrats more likely to name Russia. Concerning allies, 18% of Americans named Britain, 12% named Canada and 9% named Israel.
Pew Research Center polled thousands of people from each of the 25 countries considered in the poll in the first half of 2025.
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Trump slaps Brazil with 50% tariff, citing Bolsonaro ‘witch hunt’ trial
U.S. President Donald Trump singled out Brazil for import taxes of 50 per cent on Wednesday for its treatment of its former president, Jair Bolsonaro, showing that personal grudges rather than simple economics were driving the U.S. leader’s use of import taxes.
Trump avoided his standard form letter with Brazil, specifically tying his tariffs to the trial of Bolsonaro, who is charged with trying to overturn his 2022 election loss. Trump has described Bolsonaro as a friend and hosted the former Brazilian president at his Mar-a-Lago resort when both were in power in 2020.
“This Trial should not be taking place,” Trump wrote in the letter posted on Truth Social. “It is a Witch Hunt that should end IMMEDIATELY!”
Trump also objected to Brazil’s Supreme Court fining of social media companies such as X, saying the temporary blocking last year amounted to “SECRET and UNLAWFUL Censorship Orders.”
Trump said he is launching an investigation as a result under Section 301 of the Trade Act of 1974, which applies to companies with trade practices that are deemed unfair to U.S. companies.
The Brazil letter was a reminder that politics and personal relations with Trump matter just as much as any economic fundamentals. And while Trump has said the high tariff rates he’s setting are based on trade imbalances, it was unclear by his Wednesday actions how the countries being targeted would help to reindustrialize America.
Trump also sent letters Wednesday to the leaders of seven other nations. None of them — the Philippines, Brunei, Moldova, Algeria, Libya, Iraq and Sri Lanka — is a major industrial rival to the United States.
Most economic analyses say the tariffs will worsen inflationary pressures and subtract from economic growth, but Trump has used the taxes as a way to assert the diplomatic and financial power of the U.S. on both rivals and allies. His administration is promising that the taxes on imports will lower trade imbalances, offset some of the cost of the tax cuts he signed into law on Friday and cause factory jobs to return to the United States.
Trump, during a White House meeting with African leaders, talked up trade as a diplomatic tool. Trade, he said, “seems to be a foundation” for him to settle disputes between India and Pakistan, as well as Kosovo and Serbia.
“You guys are going to fight, we’re not going to trade,” Trump said. “And we seem to be quite successful in doing that.”
On Monday, Trump placed a 35 per cent tariff on Serbia, one of the countries he was using as an example of how fostering trade can lead to peace.
Trump said the tariff rates in his letters were based on “common sense” and trade imbalances, even though the Brazil letter indicated otherwise. Trump suggested he had not thought of penalizing the countries whose leaders were meeting with him in the Oval Office — Liberia, Senegal, Gabon, Mauritania and Guinea-Bissau — as “these are friends of mine now.”
Countries are not complaining about the rates outlined in his letters, he said, even though those tariffs are close to the ones announced April 2 that rattled financial markets. The S&P 500 index was up slightly in Wednesday afternoon trading.
“We really haven’t had too many complaints because I’m keeping them at a very low number, very conservative as you would say,” Trump said.
Officials for the European Union, a major trade partner and source of Trump’s ire on trade, said Tuesday that they are not expecting to receive a letter from Trump listing tariff rates. The Republican president started the process of announcing tariff rates on Monday by hitting two major U.S. trading partners, Japan and South Korea, with import taxes of 25 per cent.
According to Trump’s letters, imports from Libya, Iraq, Algeria and Sri Lanka would be taxed at 30 per cent, those from Moldova and Brunei at 25 per cent and those from the Philippines at 20 per cent. The tariffs would start Aug. 1.
The Census Bureau reported that last year that the U.S. ran a trade imbalance on goods of $1.4 billion with Algeria, $5.9 billion with Iraq, $900 million with Libya, $4.9 billion with the Philippines, $2.6 billion with Sri Lanka, $111 million with Brunei and $85 million with Moldova. The imbalance represents the difference between what the U.S. exported to those countries and what it imported.
Taken together, the trade imbalances with those seven countries are essentially a rounding error in a U.S. economy with a gross domestic product of $30 trillion.
The letters were posted on Truth Social after the expiration of a 90-day negotiating period with a baseline levy of 10 per cent. Trump is giving countries more time to negotiate with his Aug. 1 deadline, but he has insisted there will be no extensions for the countries that receive letters.
Maros Sefcovic, the EU’s chief trade negotiator, told EU lawmakers in Strasbourg, France, on Wednesday that the EU had been spared the increased tariffs contained in the letters sent by Trump and that an extension of talks until Aug. 1 would provide “additional space to reach a satisfactory conclusion.”
Trump on April 2 proposed a 20 per cent tariff for EU goods and then threatened to raise that to 50 per cent after negotiations did not move as quickly as he would have liked, only to return to the 10 per cent baseline. The EU has 27 member states, including France, Germany, Italy and Spain.
The tariff letters are worded aggressively in Trump’s style of writing. He frames the tariffs as an invitation to “participate in the extraordinary Economy of the United States,” adding that the trade imbalances are a “major threat” to America’s economy and national security.
The president threatened additional tariffs on any country that attempts to retaliate. He said he chose to send the letters because it was too complicated for U.S. officials to negotiate with their counterparts in the countries with new tariffs. It can take years to broker trade accords.
Japanese Prime Minister Shigeru Ishiba interpreted the Aug. 1 deadline as a delay to allow more time for negotiations, although he cautioned in remarks that the tariffs would hurt his nation’s domestic industries and employment.
Malaysia’s trade minister, Zafrul Aziz, said Wednesday that his country would not meet all of the U.S. requests after a Trump letter placed a 25 per cent tariff on its goods. Aziz said U.S. officials are seeking changes in government procurement, halal certification, medical standards and digital taxes. Aziz he indicated those were red lines.
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