Trump's Tariffs: Argentina Gets the Lowest Tariff and Brazil the Highest

The reciprocal tariffs distributed by Donald Trump to dozens of trading partners come into effect from Thursday (7), with a floor of 10% and a ceiling of 41%.

Brazil appears on the list with the same base value announced in April , on Liberation Day.

Last Wednesday (30), however, the President of the United States confirmed, already considering this base rate, that he would increase the tariff applied against Brazilian imports by 40 percentage points, totaling 50% .

The South American neighbors, on the other hand, received different treatment.

Of all the countries in South America, besides Brazil, only Bolivia, Guyana and Venezuela had rates above the minimum, all at 15%, according to the executive order signed by Trump on Thursday night (31).

The 10% rate is targeted at countries with which the US maintains a trade surplus, meaning they sell more than they import. The 15% rate is the base rate for nations that sell more to the US than they import from it.

Among those covered by the minimum rate, Argentina.

Milei closed with Trump, Lula isolated

Under Javier Milei, the brothers strengthened ties with the US, especially looking to Donald Trump as an ally .

Even before the Republican returned to the White House, the Argentine president was already defending ideological and commercial agendas similar to those of the North American in international organizations .

In 2024, the trade balance between the two countries showed a slight advantage for Washington, with a surplus of US$275.4 million against Buenos Aires, according to Mercosur data. The surplus is the result of US$4.56 billion in Argentine exports and US$4.83 billion in imports from the United States.

Crude oil, pearls and precious stones, and aluminum and its manufactured products are the three main items on Argentina's sales list to the US. Meanwhile, items related to natural gas are among the largest imports.

Meanwhile, the US reaped an even more positive trade surplus from Brazil: a surplus of US$283.8 million in 2024. Even so, Brazilian products will be subject to the higher tariff imposed by Trump due to the surcharge.

Washington's conflict with the Lula administration goes beyond commercial matters. This is evident by looking at the title of the decree signed by Trump, in which he confirmed the 50% tariff: "Addressing Threats to the United States by the Government of Brazil."

"Recent policies, practices, and actions of the Government of Brazil threaten the national security, foreign policy, and economy of the United States. Members of the Government of Brazil have taken actions that interfere with the United States economy, infringe on the free expression rights of United States citizens, violate human rights, and undermine the United States' interest in protecting its citizens and businesses," Trump wrote in the executive order.

"Members of the Brazilian Government are also politically persecuting a former president of Brazil [Jair Bolsonaro], which is contributing to the deliberate breakdown of the rule of law in Brazil, politically motivated intimidation in that country, and human rights abuses."

After Supreme Court Justice Alexandre de Moraes ruled that Bolsonaro should wear an electronic ankle bracelet, Trump revoked the visas of the judge and his allies, and more recently applied the Magnitsky Act against him, which imposes financial sanctions on those affected.

Even before the movements of the last two weeks, the US president had already expressed his discontent with Brazil when he announced the 50% tariff on July 9: at the time, he said that "Brazil has not been good to us" and critically pointed to the regulation of big tech in the country and the trial against the former president for the alleged coup plot .

Furthermore, the Republican has repeatedly spoken out against the agendas defended by Brazil within the BRICS group to seek to consolidate an alternative international financial system that is more inclusive of emerging countries and avoids the use of the dollar.

In the meantime, Milei sought to cultivate a bond with the President of the United States, consequently distancing herself from her South American peers.

Despite having participated in the conclusion of the historic agreement between Mercosur and the European Union, the Argentine president is critical of the bloc's "excessive bureaucracy" and believes that "all it has done since its creation is enrich major Brazilian industrialists, at the expense of impoverishing Argentines." In March, he threatened to withdraw South America's second-largest economy from the group. At the same time, Milei has signaled an interest in forging a free trade agreement with the United States .

The Argentine's closeness to the American and resistance to the president of Brazil, Luiz Inácio Lula da Silva (PT), was shared by Milei on social media in November after a meeting at the G20 Summit.

The post compares the smiling Argentine leader next to Trump, while he appears with a serious expression next to the Workers' Party leader . The photo's caption reads: "With the right // with the left."

Amidst the tariff hike, Milei even suggested that Brazil should thank Argentina for not having been hit , initially, by a higher tax rate.

Today, while contemplating the lowest tariffs applied by Trump, Argentina believes there is a chance of emerging in foreign trade with the surcharge applied to Brazil , despite fearing a diversion of exports.

Meanwhile, the Milei government announced that it will grant citizenship to large foreign investors in the country , a move that, according to the Argentine Ministry of Economy, will consider “protocols and security standards of third countries,” such as those of the United States visa waiver program.