Despite a global trade slowdown, the trade relationship between China and Mexico is thriving, potentially becoming the world's fastest-growing. In January this year, container demand surged by almost 60 percent compared to the same period last year.
Chinese firms are heavily investing in Mexico, with Lingong Machinery Group planning to build a $5 billion plant in Nuevo Leon and Trina Solar intending to invest up to $1 billion in the same state.
These investments have benefited Mexico's exporters, allowing the country to surpass China as the top exporter of goods to the U.S. in September last year, a position it hadn't held in nearly two decades.
Attracted by Mexico’s large market, lower labor costs, and skilled workforce, Chinese investors also appreciate Mexico’s proximity to the U.S., providing a logistical advantage for serving the American market. Contrary to some beliefs, the interest of Chinese companies in Mexico is not primarily to bypass sanctions.
Mexico has emerged as a key player in the global automobile industry, ranking as the world's seventh-largest auto producer. Chinese automakers now account for nearly 20 percent of total car sales in Mexico, a significant rise from almost no sales six years ago.
However, recent months have seen Washington express concerns over the influx of Chinese investments, particularly in the electric vehicle sector. Major Chinese EV manufacturers like MG, BYD, and Chery are considering establishing production facilities near the U.S. border, with reports of a $12 billion battery plant in the works. Mexican officials are carefully evaluating these proposals to avoid potential backlash from Washington.
Reference(s):
cgtn.com
