Argentina and the United States sign a major trade deal that targets tariffs and strengthens the political alliance

BUENOS AIRES, Argentina – Argentina and the United States agreed Thursday to ease restrictions on each other’s goods in a broad trade deal that bolsters President Javier Miley’s campaign to open up Argentina’s protectionist economy and the Trump administration’s push to lower food prices for Americans.

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The deal, which cuts hundreds of mutual tariffs between the two countries, also reflects the importance of Miley’s ideological loyalty to US President Donald Trump, even if the chronically distressed South American nation long isolated from the global economy has little to offer Washington in the way of economic reward or geopolitical influence.

Argentina’s radical liberal leader has made dramatic efforts to demonstrate his devotion to Trump, reshape his country’s foreign policy in line with the United States, and support Trump’s increasingly aggressive interventions in the Western Hemisphere. Miley has traveled to the United States at least a dozen times since taking office and plans to visit Trump’s private Mar-a-Lago club in Florida again next week.

The efforts have paid off. Last year, when market turmoil threatened to derail Miley’s free-market reform and drain Argentina’s foreign currency reserves before crucial midterm elections, Trump offered his ally a $20 billion line of credit. Miley avoided devaluation and won a decisive election victory that sent markets higher.

A trade deal between ideological allies

Argentine Foreign Minister Pablo Cuerno and US Trade Representative Jamison Greer said Thursday that they had signed the trade and investment agreement in Washington.

Read more: Trump moves to lift visa restrictions for Argentina to support his right-wing ally

After imposing sweeping tariffs on its trading partners, the Trump administration changed its tune last November when it announced framework agreements with four Latin American countries, including Argentina.

The White House said reducing tariffs on Argentine beef and Ecuadorian bananas, among other imports, would improve the ability of American companies to sell products abroad and mitigate higher prices for American consumers. The announcement also came as Trump’s steep tariffs drew scrutiny from the Supreme Court.

On Thursday, Argentina became the first of the four countries to finalize its agreement with Washington. Kernow hailed the decision as a milestone not only in Argentina’s alliance with the United States, but also in Miley’s campaign to rebuild the defaulting nation’s reputation.

“Today, Argentina sent a clear signal to the world,” he wrote on social media. “We are a reliable partner, open to trade and committed to clear rules, predictability and strategic cooperation.”

Concessions could revive criticism

Argentina’s Foreign Ministry said it would remove trade barriers on more than 200 categories of goods coming from the United States, including chemicals, machinery and medical devices. The most politically sensitive imports, such as vehicles, live livestock and dairy products, will enter the country duty-free under government quotas.

Read more: Argentina secures IMF loan and ends most capital controls in major milestones for President Miley

These are key concessions, as Argentine industries long protected by heavy tariffs worry about their ability to compete with American manufacturers. Domestic producers have already seen their sales decline as Miley opened the economy to the onslaught of cheap Chinese products.

For its part, Washington will eliminate reciprocal customs duties on 1,675 Argentine products, increasing government export revenues by more than $1 billion, the Argentine Foreign Ministry said. The list of specific products is still unclear, but the White House said it includes “unavailable natural resources” and ingredients for pharmaceutical goods, after Argentina agreed to improve intellectual property protection procedures.

The United States also promised to review its 50% taxes on Argentine steel and aluminum imports – a disappointment to Argentine manufacturers who expected the trade agreement to eliminate crippling tariffs completely. The deal also sees the United States quadrupling the current amount of Argentine beef it imports at a lower tariff rate to 100,000 tons per year.

Argentine beef flow

The influx of Argentine beef could draw criticism from ranchers and Republican lawmakers who expressed anger last October when Trump first floated plans to increase imports of Argentine beef to drive down prices.

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The move followed the Trump administration’s $20 billion lifeline and direct purchases of Argentina’s dollar-denominated bonds that rating agencies had been classifying as “junk” and its devalued currency that investors were dumping in droves.

The backlash was immediate. Trump’s MAGA base has questioned the need to bail out a remote country that has never been a natural trading partner for the United States: The two countries export many of the same things, and compete directly in the markets for soy, corn, wheat, meat and oil.

Democratic lawmakers were angry that Trump was betting taxpayer money on a political gift to a friend.

These criticisms continue, as US Senator Elizabeth Warren, the top Democrat on the Senate Banking Committee, on Thursday appealed to Treasury Secretary Scott Bessent to end the $20 billion bailout plan.

Associated Press writer Josh Bock in Washington contributed to this report.