Brazil and Mexico Team Up as U.S. Tariffs Loom

Brazil and Mexico, Latin America’s two largest economies, have started urgent talks to boost trade between them as the United States moves to place heavy tariffs on their exports.

According to official statements from both governments, President Trump’s new policy will soon hit Brazilian exports to the U.S. with a 50% tariff, while some Mexican exports not covered by the North American trade pact will see a 30% tariff.

These tariffs are set to begin August 1, putting major pressure on both economies. Right now, most Mexican exports—about 80%—go to the U.S. Brazil’s biggest customer is China, but the threat from U.S. tariffs is still serious.

While trade between Brazil and Mexico reached $13.6 billion in 2024, that is only a fraction of their U.S. trade. Currently, just 12% of Brazil-Mexico trade benefits from lower tariffs under existing deals, mostly limited to cars and basic goods.

Leaders from both countries see a need to quickly expand their partnership. Brazil’s vice president and a group of business leaders plan to visit Mexico in August to push talks forward.

They aim to cover more industries—like food, chemicals, aircraft, and energy—and protect local companies from the impact of the new U.S. tariffs. Brazil is strong in agriculture and raw materials.

Brazil and Mexico Pursue Closer Trade Ties to Boost Regional Stability

Mexico is a top player in manufacturing. Officials say more direct trade between them could protect jobs and businesses faced with unpredictable policies from Washington.

Both governments are also working separately to strike deals with other markets, including Europe, but agree that closer ties within the region could offer valuable stability.

Together, Brazil and Mexico account for more than half of Latin America’s economy and population, according to their economic institutes.

Business leaders and trade officials highlight that deeper cooperation could help both nations weather global changes and reduce their reliance on one big trading partner.

Negotiations are ongoing and the outcome is not guaranteed. But both governments stress that a stronger Brazil-Mexico trade relationship is now a practical step, backed by the latest economic data, to stand up to external risks and keep their economies strong.

More: Brazil news in English, every day from The Rio Times.

This article was drafted with automated assistance and reviewed before publication. How we use AI · Report an error