Mexico to Investigate Coming Investments

Mexico will create a body similar to the US Foreign Investment Committee to ensure that investments in the country do not pose a threat to national and regional security. This follows US’ comments criticizing Chinese investments due to the illegal entry of fentanyl into Mexico and the US. 

Janet Yellen, US Secretary of the Treasury, assured that the signing of a Memorandum of Intent by the US and Mexico does not seek to limit Chinese investments, but rather to exchange information on incoming investments for security reasons. "If China invests in Mexico, it should be as long as there is a security program, an evaluation, so that these investments do not generate security concerns for Mexico or the US. We have no problem with China investing in Mexico to be able to produce services and products that we could import," Yellen said.

"The focus would be strictly on the national security issue. Our focus, in talking to Mexico, is not on China. It is a general approach to make sure that there are no national security issues that are involved in any foreign investment," Yellen said. However, it should be noted that the tension between the US and China is growing, as the former accuses the latter of illegal fentanyl trafficking to Mexico and the US. On his part, Xi Jinping, Chinese President, denied that fentanyl trafficking originates in China and stated that the US must take responsibility for its own problems.

Rogelio Ramírez de la O, Minister of Finance and Public Credit, said that Mexico accepted this cooperation proposal because the US is Mexico's main trading partner. As a result, this bilateral relation is a priority. 

Nearshoring has opened the door to many Chinese investment ventures coming to Mexico, looking to expand their market and better target the US market. According to data from the Ministry of Economy, China is Mexico's second-largest trading partner and ranks first in the Asia-Pacific region. From January 1999 to June 2023, Mexico received a total of US$2.5 trillion in Foreign Direct Investment (FDI) from China, distributed in new investments (US$1.6 trillion), inter-company accounts (US$745 million), and profit reinvestment (US$225 million). China's share in Mexico's imports was 18.5%, equivalent to US$74.1 billion in 2023.