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International and Chinese Investors Boost Ties to Mexico

08 January, 2013

Not only is China working to increase its relations with Mexico, but the Wall Street Journal is calling Mexico the “new China” for investors from around the world, citing the nation’s surge in manufacturing, competitive wages and close economic connection to the U.S.  

“Mexico seems to have made a turn for the better, the environment is changing and its stock market has noticed,” writes the WSJ. “Since the country is less exposed to China and Europe than any other major emerging markets, that outperformance is likely to continue.”

In addition,China Daily reported that the Chinese government has recently sent a high-level delegation to Mexico in an effort to bolster ties in trade, investment and tourism between the two countries. The visitors included more than 20 Chinese bank representatives and entrepreneurs, who explored prospects of additional cooperation between China and Mexico real estate, especially in areas such as oil exploration, mining and textiles.

“Mexico is now China’s second-largest trade partner in Latin America, while China is Mexico’s second-largest trade partner in the world and the third largest export destination,” writes China Daily. “Bilateral trade hit $34 billion in 2011.”

The Wall Street Journal also reported that the recent surge in Chinese wages, which were up more than 14 percent in 2011, remain a driving force behind Mexico’s growing reputation as an attractive place to invest and conduct business. In addition, Mexico is expecting a more developed GDP than China in 2012 and shipping across the border into the U.S. is geographically much more cost effective than bringing goods to market all the way from China.

“Mexico sends 78.7 percent of its exports to America and gets 49.8 percent of its imports from there,” writes the WSJ. “With the European situation and China slowing down, the Mexican economy’s leverage to the U.S. has turned into a strength.”

Topics: Investment