Paraguay · Trade
Key Facts
—Targeted countries About 60 trading partners were named in the new US tariff round, but Paraguay was not among them.
—Tariff rates The new duties range from 10% to 12.5% and take effect just after midnight on July 24, 2026.
—Policy rationale Washington framed the tariffs as a tool to enforce compliance on forced-labor concerns, not a blanket measure.
—Expiring surcharge A separate 10% Section 122 surcharge on most imports is scheduled to expire on the same day, July 24, 2026.
—Regional lobbying Several Latin American governments and steelmakers had been urging Washington to grant them exemptions.
Paraguay has secured a Paraguay US tariff exemption from a new round of American import duties, according to international trade reports. The administration of U.S. President Donald Trump unveiled a tariff package in early July 2026 targeting about 60 trading partners, but the South American nation was conspicuously absent from the list.
Paraguay US tariff exemption: A Targeted, Not Universal, Tariff Action
The new U.S. tariffs, reported by Reuters on July 7, 2026, impose duties in the range of 10% to 12.5% on a wide swath of goods. They are scheduled to take effect just after midnight on July 24, 2026, adding a fresh layer of complexity to global trade.
Unlike a blanket measure, the action was designed to penalize countries seen as failing to stop imports made with forced labor. Because Paraguay was not identified as a problem case under this specific enforcement logic, it was effectively outside the scope of the announced action.
Why Paraguay Was Left Out
The administration’s rationale centered squarely on forced-labor enforcement concerns. Countries that could demonstrate they were not part of the enforcement target, or that were simply not flagged, avoided the new duties.
Available sources do not name Paraguay as one of the jurisdictions singled out. The late-July reporting describes the measure as focused on other Latin American suppliers and on products associated with labor-compliance failures.
While a more granular official reason was not immediately available, the exclusion spares Paraguayan exporters from a direct cost increase that competitors in the region now face.
A Shifting US Tariff Landscape
The new duties land in an already unsettled trade environment. A separate 10% Section 122 surcharge on most imports, which began on February 24, 2026, is scheduled to expire on the very same day the new tariffs take effect – July 24, 2026.
That temporary surcharge was imposed to address fundamental international payments problems, according to a White House proclamation. Its expiration could offset some of the new cost burdens for global shippers, but the overlapping deadlines create significant uncertainty for supply-chain planners.
For foreign investors and expats watching Latin America, the shifting deadlines mean that the tariff landscape can change within hours, making country-level exemptions like Paraguay’s especially valuable.
Regional Fallout and Lobbying Efforts
Several Latin American governments and steelmakers had been actively lobbying Washington to grant them exemptions, Reuters reported. They argued that the new duties would harm trade ties and that some countries did not warrant punishment.
The broader policy logic, as framed in the reporting, was that the U.S. was using tariffs as leverage over labor-enforcement compliance rather than applying them uniformly across all Latin American economies.
Paraguay’s absence from the target list suggests its diplomatic and commercial positioning aligned with Washington’s enforcement priorities, at least for this round.
What It Means for Business and Investment
For companies with supply chains in the Southern Cone, the exemption makes Paraguay a comparatively more predictable sourcing base. Goods shipped from Paraguay avoid the 10% to 12.5% duty that now applies to competitors in targeted nations.
The development may also strengthen Paraguay’s appeal as a nearshoring destination. Investors evaluating regional manufacturing or agricultural export hubs often weigh tariff exposure as a key site-selection factor.
Still, trade policy remains fluid. The expiration of the Section 122 surcharge and the new forced-labor tariffs taking effect on the same day could prompt further adjustments, and exemptions can be reviewed as enforcement priorities shift.
Frequently Asked Questions
Why was Paraguay exempted from the new US tariffs?
Paraguay was not among the roughly 60 trading partners targeted because the tariffs were aimed at countries seen as failing to stop imports made with forced labor, and Paraguay was not flagged as a problem case.
When do the new US tariffs take effect?
The new duties, ranging from 10% to 12.5%, are scheduled to take effect just after midnight on July 24, 2026, the same day a separate 10% Section 122 surcharge is set to expire.
How does the Paraguay exemption affect foreign investors?
It makes Paraguay a more predictable export base by sparing its goods from the new duties, potentially boosting its attractiveness for nearshoring and supply-chain diversification in South America.
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