The Brazilian government is contemplating a reduction in import taxes on ethanol, aiming to bolster diplomatic ties with the United States and address domestic inflation concerns. This initiative seeks to encourage the U.S. to reconsider its recent 25% tariff on Brazilian aluminum and steel imports.

The proposal aligns with President Luiz Inácio Lula da Silva’s strategy to strengthen international relationships while managing internal economic pressures. By lowering ethanol import taxes, Brazil hopes to mitigate rising fuel costs, thereby easing inflation’s impact on consumers.

The Ministry of Industry and Commerce has yet to comment on this potential policy shift. The move underscores Brazil’s commitment to fostering global trade partnerships and maintaining economic stability.