With an eye on Trump, Milei threatens Mercosur and tries to undermine Brazil’s power

Although there is a real desire on the part of the White House to use Milei as its South American ally and as a way of containing a progressive agenda in the region, diplomats warn that the Argentinean may have his ambitions frustrated. This, according to sources, is due to the American’s protectionist nature.

Trump, even before taking office, announced that he would apply import tariffs against goods from Mexico and Canada, their closest trading partners.

The president-elect also signaled a widespread increase in tariffs, including against European allies.

In the case of Argentina, Milei’s team calculates the impact that an agreement with Trump would have. Today, trade flow with the USA totals US$14 billion, with a deep deficit for Buenos Aires. Americans appear only in fourth position among the main trading partners.

But observers indicate that there is an element of the export agenda that could unlock an agreement between Milei and Trump: oil exports. The new American government aims to reduce its dependence on fuel from the Middle East and concentrate its supply in Latin America. In this account, Venezuela and Argentina can be fundamental.

Geopolitical impact

Milei’s initiative questions the very foundation of Mercosur. By allowing each country to negotiate a separate agreement, the new rule would undermine Brazil’s influence as a central actor in the region.