Background on Argentina-Brazil Trade Relations
Argentina and Brazil maintain a significant bilateral trade relationship, with April 2025 seeing a record-breaking deficit of $625 million. This development stems from a 45.2% surge in Argentine imports and a 19.9% decline in exports to Brazil.
Trade Figures and Trends
The total bilateral trade between Argentina and Brazil amounted to $2,568 million in April, marking an 11.1% increase compared to the same month in 2024. However, this figure represents a 0.9% decrease from March’s results.
- Argentine exports to Brazil fell by 19.9%.
- Argentine imports from Brazil rose by 45.2%.
- The trade deficit reached $625 million, as per the latest report by the Argentine Chamber of Commerce and Services (CAC).
The second consecutive month of interannual export decline saw Argentina’s foreign currency earnings drop to $972 million, while import demand reached $1,597 million.
In the first four months of 2025, Argentina’s trade balance was negative to the tune of $1,916 million. This contrasts sharply with a surplus of $38 million during the same period in 2024.
Abeceb, a consultancy firm, highlighted that Argentina’s trade deficit with Brazil in April was the highest since August 2023, compared to a surplus of $116 million in April 2024.
Reasons Behind the Import Surge
Abeceb attributed the import increase primarily to the automotive sector, where all sub-sectors experienced growth. The top contributors accounted for 76% of the import increase, totaling $380 million out of the $497 million rise.
- Passenger vehicle imports from Brazil increased by 164% annually, totaling $385.5 million.
- Commercial vehicle imports grew by 343%, reaching $108.3 million.
- Road vehicle imports rose by 370.1% annually, totaling $72 million.
“The automotive import surge relates to the normalization of external trade from very low levels in 2024, coupled with market recovery and cheaper imports,” Abeceb explained.
Export Performance and Future Outlook
Argentina’s exports to Brazil totaled $972 million in April, marking a 20.0% annual decline and its second drop after nearly a year of increases. This represents the “worst” decline since February 2024.
Despite the annual drop, Argentina’s exports showed a 28.2% annual increase in January-February, leading to only a 0.7% annual decline in the first quarter due to strong early performance.
Experts predict that Argentina’s trade deficit with Brazil will widen significantly from a limited negative balance of $308 million in 2024 to nearly $6,000 million in 2025. Two opposing factors will shape this bilateral flow:
- A projected economic slowdown in Brazil, which may moderate the rise in Argentine exports due to high inflation eroding real wages and pushing interest rates up.
- Argentina’s economic recovery from two consecutive recessive years, with a projected 5.5% annual growth rate, is expected to boost import demand.
Key Questions and Answers
- What caused Argentina’s record trade deficit with Brazil in April 2025? The primary reason was a significant surge in imports, particularly in the automotive sector, which more than compensated for the decline in exports.
- How have Argentina’s exports to Brazil performed in 2025 so far? Argentine exports to Brazil have shown a 20.0% annual decline in April, following nearly a year of increases.
- What factors are expected to influence the Argentina-Brazil trade relationship in 2025? A projected economic slowdown in Brazil and Argentina’s economic recovery are the key factors shaping the bilateral trade dynamics.
