Latin American economies seem relatively well-positioned following the U.S. Supreme Court’s decision to invalidate last year’s tariffs on imports of goods and services and President Donald Trump’s announcement of a new 15% global tariff.
Trump’s previous levies were invalidated on February 20, after a majority of the U.S. Supreme Court’s justices (6-3) ruled that the president exceeded his authority to issue them, dealing the government a major setback. That day, Trump set a replacement global tariff of 10%, which, a day later, was increased to 15%.
AQ asked analysts to share their reactions and perspectives about the impact in Latin America.
Ernesto Revilla
Managing director and head of Latin American economics at Citigroup
The Supreme Court’s decision to strike down the IEEPA tariffs—imposed under the guise of an economic emergency—marks a significant moment in America’s turn towards protectionism. The ruling’s full consequences for the global economy, the U.S., and Latin America remain uncertain, but several conclusions are already apparent.
The ruling does little to alter the administration’s determination to re-engineer global trade in favor of the domestic industry. Tariffs will continue to be the instrument of choice, deployed through a sizeable arsenal of legal authorities formerly familiar mainly to trade lawyers and now widely used by neophytes.
Therefore, uncertainty will persist—and may intensify. Importers will seek reimbursement for duties now deemed unlawful, which reportedly account for roughly 60% of tariff revenues. Litigation could drag on for years. Floating or volatile tariffs will continue weighing on investor confidence, dampen trade flows, and accelerate the redirection of trade already underway.
In this scenario, Latin America remains comparatively well-positioned. The region’s main commodity exports—such as copper from Chile and Peru—have largely been spared. Some large economies, notably Brazil, send a modest share of their exports to the US, and Mexico retains preferential access under USMCA. In the short run, the region’s relative advantage may have narrowed as some European and Asian exporters see tariffs trimmed to 15%. Yet the broader thesis endures: Latin America supplies commodities and mid-tier manufactures that the U.S. needs; proximity will always count; and the U.S. (at full employment) cannot credibly substitute for these imports.
The ruling’s broader significance is institutional. By constraining executive power, the Supreme Court may not reverse protectionism. But it does alter its momentum—and the presumption of its permanence that markets had begun to price in.
Sol Azcune
Political analyst at XP Investimentos
The Supreme Court’s decision invalidating tariffs imposed under the International Emergency Economic Powers Act (IEEPA) marks a significant rebuke to the executive’s use of emergency authority for sweeping trade measures.
For Brazil, the immediate practical impact is significant but limited. The ruling invalidates all IEEPA-based tariffs, including the 10% reciprocal tariffs introduced in February 2025 and the 40% surcharge imposed on Brazilian products from August 2025. That surcharge, introduced amid political tensions related to the prosecution of former President Jair Bolsonaro and affecting goods outside the White House’s July 2025 exceptions list (covering more than 200 products, including beef and oranges), has now been nullified.
Brazil’s Vice President Geraldo Alckmin described the decision as restoring competitiveness in the U.S. market, since the 40% rate was especially burdensome compared to other countries.
The ruling does not automatically trigger refunds for duties already paid (estimated at over $1 billion for Brazilian exports), as that issue will be addressed by lower courts. In addition, levies enacted under other authorities, such as Section 232 (national security) or Section 301 (unfair trade practices), remain in effect, including those on steel, aluminum, and other Brazilian exports.
Furthermore, President Trump responded the same day by imposing a new temporary 10% global tariff under Section 122 of the Trade Act of 1974 (effective February 24, 2026), increased to 15% on February 21—the maximum allowed under this untested authority, limited to 150 days without congressional extension. This applies uniformly to Brazil but includes product-specific exemptions (e.g., critical minerals, energy products, agricultural items like beef and oranges, pharmaceuticals, electronics, vehicles, and aerospace), benefiting many Brazilian exports. While this framework replaces part of the previous exposure, it keeps trade pressure, albeit without the earlier punitive disparity.
The broader implication for Brazil’s commercial relationship with the U.S. is that a legal victory on one front does not eliminate exposure to other trade restrictions. Although the IEEPA tariffs are no longer legally sustainable, U.S. policymakers retain multiple statutory avenues to maintain or introduce duties, including the potential launch of new Section 301 investigations. At the same time, the ruling may introduce fresh predictability challenges for exporters navigating an evolving policy environment.
From a legal and constitutional standpoint, the decision is welcome. For Brazilian exporters, however, the trade landscape will remain fluid, and sustained legal and policy engagement on the remaining measures will be critical.
Antonio Ortiz-Mena
CEO of AOM Advisors, Adjunct Professor of International Economic Relations at Georgetown University’s Walsh School of Foreign Service, and Chair of the Mexican Foreign Trade Council (COMCE)‘s USMCA Committee
The U.S. Supreme Court’s 6–3 decision that IEEPA does not authorize the president to impose tariffs is a clear reaffirmation of domestic checks and balances. Enacted in 1977, IEEPA was designed to address genuine national emergencies through financial sanctions and asset freezes—not to serve as a general source of tariff authority. The Court restored an important limit on executive power.
But the policy story did not end there, and trade policy uncertainty remains. Within hours, the administration invoked Section 122 of the Trade Act of 1974 to impose a global import surcharge—initially at 10%, then raised the next day to 15%, the statutory maximum allowed for 150 days without congressional approval. That rapid shift underscores a central problem: uncertainty. When tariff rates change wildly within 24 hours, companies and investors are forced to recalibrate risk and may halt significant transactions until uncertainty decreases.
Section 122 was crafted to address serious balance-of-payments pressures impacting the U.S. economy as a whole. Yet much of the administration’s justification has focused on bilateral goods trade deficits with specific countries. Those are different concepts. A trade deficit with a particular partner does not necessarily signal a nationwide external imbalance. Using a global tariff to address country-by-country deficits moves the law beyond what it was originally meant to do.
The same question could arise in new Section 301 investigations that the administration has signaled it may pursue. Will they focus on genuinely unfair trade practices and violations of international commitments? Or will they be used primarily to rebalance bilateral trade flows?
The hemispheric picture highlights the tension. In 2025, the U.S. registered goods trade deficits with Mexico ($197 billion) and Canada ($46 billion), but an overall goods trade surplus with South and Central America ($52 billion), including Brazil ($14 billion). A global tariff applies across partners with very different trade relationships to the U.S.
In practice, however, the application on Section 122 tariffs policy is not fully uniform. USMCA-compliant goods and services have been exempted from the Section 122 tariffs—a recognition of North America’s deeply integrated supply chains. Other FTA partners have not fared as well.
The Court clarified one boundary. But Section 122 tariffs remain in effect, and potential Section 301 actions add another layer of risk. Uncertainty persists, as do questions about external checks and balances and compliance with international trade rules. In today’s environment, unpredictability itself may be the most consequential tariff of all.
Why Trump’s Tariffs Are Doing Limited Harm in Latin America
Except for Mexico, the region will not be significantly impacted.
REACTION: Trump Threatens 30% Tariffs on Mexico
Reading Time: 7 minutesThe baseline 10% tariff applies to many countries in Latin America, with notable exceptions.
