Chinese Companies Investing Discreetly in Mexico

By Elliot Bullman

Is China Mexico's new business partner?

Companies in China have quietly stayed away from the spotlight in order to capitalize on engaging in trade with 900 Mexican firms in manufacturing, services and commerce particularly in Mexico City, Jalisco and Baja California.

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Chinese companies are now waiting eagerly to see what happens to the impasse in the global economy to invest more heavily in sectors such as manufacturing in Mexico.

Currently, Mexico is looking to Chinese investors and this is an excellent opportunity to "not be anchored" to foreign trade decisions in the United States, says Sergio Ley López, President of the Asian and Oceania Region of the Mexican Business Council of Foreign Commerce, Investment and Technology (COMCE).

"It is not viable that we continue to have a trade and economic relationship linked to a single country such as the United States, where 85% of our exports end up," he says.

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Approximately 85% of imports from China are intermediate goods, i.e. products to be incorporated into manufacturing processes in Mexico.

The Ministry of Economy has registered 900 Mexican companies whose capital investment is derived from China, reveals Enrique Dussel Peters, coordinator of the Academic Network of Latin America and the Caribbean on China.

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The researcher explains that in Mexico 53% of Chinese companies are located in the wholesale trade sector; 10.6% of enterprises are engaged in retail trade and 7.3% of enterprises are engaged in the manufacture of transportation equipment.

Mexico City is the main destination for Chinese companies participating in 18 economic subsectors, and between 1999 and 2016, Chinese firms have invested close to $421MUSD, says Enrique Dussel.

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