Mexico: One of the US’s Top Three Trading Partners
By Juan Iván Álvarez Chabre | Cd. Juarez Regional Director at American Industries Group®
Mexico and the United States have a long history of social and economic interdependence, ties which are more important today than ever. Recent years have highlighted this interdependence and the importance of fostering mutual prosperity through cross-border investments and the coordination of academia, government, and industry. As countries worldwide implement post-pandemic plans to bolster economic growth and create more agile supply networks and social systems, these two countries are working more closely than ever to facilitate the movement of people, goods, and services across their shared border.
Their commitment to these priorities was renewed in 2020 with the enactment of the United States-Mexico-Canada Agreement (USMCA), and more recently, through the relaunching of the U.S.-Mexico High-Level Economic Dialogue (HLED) in 2021 with over 21 outreach engagements being held across civil society, the private sector, academia, and non-governmental organizations between August 2021 and September 2022. These efforts have increased imports and exports between the two countries as companies and governments focus on economic recovery plans, strengthening regional supply chains, and removing logistics and government barriers to trade.
Though Mexico has long been one of the U.S.’s top three trading partners, in August and September of 2022, Mexico surpassed Canada as number one, with China coming in third. Imports to the U.S. in the electronics, automotive, and automotive parts industries led to this increase in trade to US 520.12 billion through the first eight months of 2022, with a total of US 70.04 billion in August alone.
For decades, an increasing number of U.S. companies have begun establishing or expanding operations to Mexico to take advantage of the many opportunities it offers to improve their bottom lines, become more competitive, and increase the transparency and agility of their supply chains, especially after widespread disruptions in 2020 and 2021.
Joint efforts to strengthen these ecosystems are currently taking place, focusing on the automotive and semiconductor as information and communications technology (ICT) industries. The U.S.-Mexico Supply Chain Working Group was recently established, under which the Mexico Ministry of the Economy signed a memorandum of understanding with leading technology companies to facilitate and strengthen workforce development in the semiconductor and ICT supply chains. On the other hand, Mexico’s Ministry of Foreign Relations established a Transport Electrification Working Group to support the U.S. and Mexican automotive industries’ transition to the production of electric vehicles
These efforts make it clear that Mexico will continue to play a critical role as one of the U.S.’s most essential partners in increasing regional economic stability and integration to strengthen trade, regional supply chains and promote investment in human capital on both sides of the border.
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