In May 2006, Tabaré Vázquez stood in the Oval Office beside George W. Bush. Uruguay’s first left-wing president, an oncologist whose coalition had campaigned against nearly everything Bush represented, had nevertheless traveled to Washington with a clear objective: securing a trade agreement. During the visit, the two leaders announced that their countries would “expand, intensify, and strengthen” their commercial relationship. A free trade agreement was openly on the table, and at the time the United States remained Uruguay’s largest trading partner.

The agreement quickly unraveled, and fairness requires acknowledging that Uruguay shared some of the blame. The left wing of Vázquez’s own Frente Amplio coalition refused to sign a deal with the Bush administration, while Argentina publicly voiced support but privately assured American diplomats it would block the agreement within Mercosur, whose rules prevent member states from negotiating bilateral tariff deals independently. Trade negotiations fail all the time, and in isolation, this episode would scarcely merit much attention. What makes it significant is what happened over the next two decades. The missed opportunity became the starting point for a broader realignment that is now reshaping trade across the Americas.

A year after Vázquez’s visit, Washington established a Trade and Investment Framework Agreement with Uruguay. In 2022, it added the country to the Americas Partnership for Economic Prosperity. Both initiatives created forums for dialogue and standing committees, but neither meaningfully expanded Uruguay’s access to the U.S. market. Today, Uruguayan beef—by far the country’s largest export to the United States—still enters under the same fixed 20,000-ton quota established in 1995. Shipments above that threshold face a 26.4 percent tariff, made even steeper by the additional 10 percentage points Washington imposed in April 2025.

According to ECLAC, Uruguayan exporters now face an average effective U.S. tariff of roughly 20 percent, the second-highest in Latin America after Brazil’s. The distinction is telling. Brazil’s tariffs were an overt political punishment tied to disputes over its judiciary and domestic politics. Uruguay was not singled out for punishment at all. In some respects, that is even more revealing, because it suggests that South America’s most dependable free-market democracy was treated worse than almost every other country through little more than sustained political indifference.

China spent those same two decades pursuing the opposite strategy. In 2001, it purchased roughly 5 percent of Uruguay’s exports. Today, it is the country’s largest trading partner, buying about a quarter of everything Uruguay sells abroad. Beijing signed a strategic partnership with Montevideo in 2016, upgraded it in 2023, brought Uruguay into the Belt and Road Initiative in 2018, and by 2022 had completed a feasibility study for a bilateral free trade agreement. When President Yamandú Orsi traveled to Beijing this February accompanied by roughly 150 officials and business leaders, Xi Jinping’s government responded to Uruguay’s long-running frustrations by proposing trade negotiations with Mercosur as a whole.

That proposal has been enthusiastically embraced by Brazil, whose willingness to preserve the existing trade relationship with Washington evaporated after the United States imposed 50 percent tariffs on Brazilian goods. Uruguay has since assumed Mercosur’s rotating presidency following the bloc’s summit in Paraguay. There, Brazilian President Lula da Silva confirmed that, after opening trade negotiations with Japan, Mercosur would seek to begin talks with China as well. Orsi, for his part, pledged to build a more modern Mercosur that is open to the world. The irony is difficult to miss. The same bloc whose rules once prevented Uruguay from concluding a trade agreement with Washington may now carry South America’s largest economies into a generational agreement with Beijing—negotiated under the chairmanship of the very country that spent two decades asking the United States first.

There is, however, a twist in this year’s trade figures that offers another perspective. American purchases of Uruguayan beef have risen so sharply that the United States may soon overtake China as Uruguay’s largest beef market. Yet this surge has little to do with a deliberate shift in U.S. policy. It is largely the byproduct of Washington’s decision to impose 50 percent tariffs on Brazilian beef while American demand for imports remained unchanged. Montevideo did nothing to earn this unexpected advantage and, realistically, can do little to preserve it. The opportunity will likely disappear the moment Washington and Brasília resolve their dispute. Even when American policy benefits Uruguay, it does so almost by accident—collateral fallout from measures aimed at someone else.

None of this should be mistaken for an endorsement of Beijing’s approach, and Montevideo is well aware of the risks. Relying on a single customer for roughly a quarter of a country’s exports is hardly a balanced trade strategy, as Uruguay’s ranchers discovered when Chinese demand for beef weakened in 2024. Diversification remains essential. But diversification requires at least two serious buyers, and for the better part of two decades, Uruguay has tried, unsuccessfully, to make the United States one of them.

Since Donald Trump returned to the White House, a familiar refrain has echoed through Washington: tariffs, pressure campaigns, and threats over strategic assets such as the Panama Canal are pushing Latin America toward China. That critique, however, flatters the problem by making it sound new. The space Beijing is occupying did not suddenly appear—it has been vacant for nearly twenty years. American policy toward the region has relied overwhelmingly on leverage, whether through tariffs, visa restrictions, or warnings about Chinese-built ports and undersea cables. That strategy works only when countries lack alternatives. China’s strategy across South America has been to become that alternative.

None of this requires Washington to outspend or outbuild the Belt and Road Initiative. It simply requires making a credible offer. Even a modest one would have an outsized impact. Expanding a beef quota that has remained frozen since 1995 would barely register in the American market, yet make headlines in Montevideo. The Americas Partnership for Economic Prosperity could be given a mandate to deliver meaningful market access rather than another round of communiqués. Washington could also reopen trade discussions with South America’s most stable democracy, whether bilaterally or in coordination with the European Union, which itself spent nearly a quarter-century negotiating its Mercosur agreement. If even these modest steps are considered too generous for a country of just 3.4 million people that consistently aligns with the West in major international forums, then Washington should at least explain what its economic offer to the region actually is, rather than leaving that role to its principal geopolitical rival.

Twenty years ago, Uruguay’s first left-wing president spent precious political capital at home to stand beside George W. Bush and ask for a trade agreement. Washington let that moment slip away. Today, Uruguay chairs Mercosur, and its president is investing his political capital in Beijing instead. If policymakers in Washington eventually begin asking who lost South America, the answer will begin with the small country that asked first—and never received a call back.