The presidents of Argentina, Brazil, Paraguay and Uruguay meet in Bento Gonzalves, Brazil today for a semi-annual Mercosur summit. The
The presidents of Argentina, Brazil, Paraguay and Uruguay meet in Bento Gonzalves, Brazil today for a semi-annual Mercosur summit.
The regional trade bloc meets only two days after the US imposed steel and aluminium tariffs—of 25% and 10% respectively—on Brazil and Argentina. Washington cited currency devaluations at the expense of US agriculture as the reason for the levies.
The decision comes amid brewing political tensions between Brazil and Argentina. In recent months, Brazil’s right-wing President Jair Bolsonaro and Argentina’s left-leaning president-elect Alberto Fernandez have sparred in the media.
The US tariffs could push relations between Brazil and Argentina in either direction. Given that the tariffs are a shared burden, they may streamline discussions today, at least temporarily eclipsing political differences and reaffirming the cooperative foundation of Mercosur. On the other hand, talks could have the opposite effect, resulting in a tit-for-tat exchange on which country is “more” to blame for the new threat to regional trade.
The latter outcome is more likely, given the ideological differences between Bolsonaro and the incoming Argentinian administration. Likewise, Bolsonaro has already stated that he does not view the tariffs as “retaliation” and is open to negotiation with Washington.
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