The governments of Donald Trump and Javier Milei announced on Thursday, after months of negotiations, an agreement “to deepen bilateral cooperation in trade and investment” between the United States and Argentina. Supported by the ideological affinity of the presidents – the same that led to the recent economic bailout granted by the Republicans to Milei -, the agreement presented is, in reality, “a framework” for the trade agreement that has yet to be specified.
The announcement was released for the first time by the White House and includes the elimination of tariff and non-tariff barriers, the opening of markets and regulatory compliance in various sectors, livestock, agriculture, mining and other sectors. Although it details numerous concessions by Argentina, the US counterpart is subject to future and possible definitions. The Casa Rosada subsequently communicated its statement and assured that an increase in beef exports had been agreed upon.
The official communication known in Washington indicates that Trump and Milei “reaffirm the strategic alliance” between the two nations on the basis of “shared democratic values and a common vision of free enterprise, private initiative and open markets”. In Buenos Aires, the Executive underlined that Argentina “enters the select group of nations with trade preferences, which constitutes a profound recognition of Milei’s economic program”.
In its most decisive paragraphs, the US statement states that “Argentina will provide preferential market access for exports of goods from the United States, including certain medicines, chemicals, machinery, information technology products, medical devices, motor vehicles, and a broad range of agricultural products.”
In that same section of the document, subtitled Rates (tariffs), the only US concession to the South American country is detailed: “The United States will eliminate reciprocal tariffs on certain natural resources unavailable (in the United States) and on unpatented products for pharmaceutical use.” Furthermore, he adds, “it will be able to positively consider the impact of the agreement on national security, also taking it into account when adopting trade measures”.
The two countries undertake, according to the American text, “to improve the conditions of bilateral and reciprocal access to beef markets”. The South American country opens its market to “live American cattle” and will allow, in a year, “access to the American poultry market”. You also agree “not to restrict market access for products using certain cheese and meat names.”
The emphasis of the Argentine statement is different. “It was agreed to significantly expand access of Argentine beef to the US market and to jointly work on the elimination of non-tariff barriers to bilateral agri-food trade,” it says. The differences between the two documents could be due to the fact that each government released them for local consumption and to avoid internal conflicts: suspicions will be clarified when the formal details of the agreement are known.
An important aspect of the pact is that Argentina would surrender, without compensation, its quality control powers in sectors such as pharmaceuticals, food and automobiles. “Argentina will allow the entry of U.S. products that comply with applicable U.S. or international standards (…), without additional conformity assessment requirements, and will continue to eliminate non-tariff barriers that affect trade in priority areas,” the White House statement read.
There is also a section dedicated to trade considerations and opportunities in the document, where two key issues are mentioned: “Argentina and the United States will cooperate to facilitate investment and trade in critical minerals (particularly lithium). Both countries have also agreed to work to stabilize global soybean trade.” In soybean production, the Argentine and US economies are competitors, and their main customer is China. With the Asian giant, the United States is fighting for global geopolitical control and its advance in South America constitutes a box in the big picture.
The document concludes by stating that the Trump and Milei governments “will work quickly to finalize the text of the agreement to be signed.” It is assumed that the presidents will meet to formalize the agreement.
Visiting the province of Corrientes, 900 kilometers from Buenos Aires, Milei spoke on Thursday of the “tremendous news” and, although it has not yet been signed, said: “The bilateral trade agreement has just been signed with the United States (…) We are strongly committed to making Argentina great again.” Argentine Foreign Minister Pablo Quirno, who was at the White House when the agreement was announced, believed that “the agreement creates conditions for increasing US investment in Argentina and includes a reduction in tariffs for key industries, increasing bilateral trade between the two countries.”
Thanks to his unconditional alignment with Trump, until now Milei had managed, on trade matters, to ensure that the Republican’s global tariff policy included reciprocal tariffs of 10% for Argentine products, the universal tariff applied this year by the United States. Just two weeks ago, financial support from the U.S. government was crucial to supporting Milei’s economic plan ahead of the midterm elections, in which the far right prevailed. And it had already played a similar role in April, when the IMF approved a loan for Argentina. This Thursday, the announcement of the framework agreement sparked multiple celebrations from the leaders of the governing parties. “Less duties, more market, more freedom”, celebrated the new head of cabinet, Manuel Adorni.
