Mexico, Singapore Eye Closer Relations During and Post-Covid-19By Sofía Hanna | Mon, 05/17/2021 - 13:01
Q: How has the commercial and cultural relationship between Mexico and Singapore evolved?
A: Both the Mexican and the Singaporean governments have identified both countries as investment and trade platforms. For Mexico, Singapore has been a hub to access not only Southeast Asia but Asia in general, especially since many companies have their headquarters in Singapore. Similarly, Mexico is a hub for Singapore in North America. This can also be seen from a geopolitical point of view, especially regarding commercial investment and logistics, given the geographic position of two countries. There is currently a disruption in the way value chains are conformed and it is convenient for Mexican companies to be in Singapore to serve the Asian and Southeast Asian markets better. Meanwhile, Singaporean companies can benefit from establishing in Mexico and becoming part of the North American value chain.
Before COVID-19, we already had the political will to make both countries trade hubs. The pandemic has made us realize the importance of globalization. For example, in the case of Singapore, relying only on neighboring countries as sources of food can be dangerous and disruptive. Amid the crisis, market diversification has opened an avenue to new suppliers of important food products. COVID-19 has also accelerated other processes, such as the development of new markets like that for meat. We are seeing an increasingly significant relationship between importers from Singapore and Mexican exporters and producers of meat that already have the necessary certificates to expand their Asian presence. Singaporean investors are interested in contributing technology and capital to develop aquacultural products and projects in Mexico. We not only want to promote greater trade but also greater investments, even beyond the agri-food area.
Q: How has the trade tension between China and the US impacted the relationship between Mexico and Asian countries like Singapore?
A: Economic hegemony, geopolitical arrangements and globalization have radically changed. China needs to create synergies, on the one hand, so together with the US they can remain an engine of growth that pulls other economies. On the other hand, both countries need to reduce tensions since it is very difficult to separate political hegemony, security, investment and technology issues. Obviously, this affects other countries and the global business culture.
What we have seen is a disruption of the productive value chains that has moved companies to not depend on China and to establish in other countries to ensure diversification of productive chains and regional integration. That being said, manufacturing-intensive processes will not be possible without China, which demands collaboration.
Q: What factors could promote the consolidation of the relationship between Mexico and Singapore?
A: Both Singapore and Mexico have chosen to open up to a multilateral trading system. It is necessary to have bilateral agreements to ensure the open but orderly growth of our economies for the benefit of our populations. We have not reached a bilateral agreement but both countries are now participating in the CPTPP, which governs all commercial and economic relations in the Asia-Pacific region. We are also finalizing the negotiations of a free trade agreement between Singapore and Mexico as part of the Pacific Alliance, which will give Mexico another point of access to Asia, starting with Singapore.
Q: What trade project between the two countries has benefited both parties the most?
A: The fact that the head of Enterprise Singapore for Latin America is now in Mexico greatly strengthens our promotional efforts. Enterprise Singapore continues to operate in the rest of the Americas but the leadership is now in Mexico, which demonstrates the importance of this country. We also have the goal of creating a Mexico-Singapore Chamber of Commerce. There is a great deal of interest in this endeavor and we have already identified the members of the council. It would be a binational chamber and it would be constituted as a Singaporean company. I would be the honorary president and the honorary vice president would be the Ambassador of Singapore in Mexico. The idea is to launch the chamber in the next few months, which would help with incentives and with developing the potential of both countries.
Q: What can Mexico learn from Asia and Asia from Mexico?
A: I think that Asia, especially amid the COVID-19 pandemic, has shown resilience from both an economic and public policy point of view. Some Asian countries had clear public health policies, for example, which proved effective in the prevention and treatment of COVID, while supporting economic continuity.
Mexico, on the other hand, has been an example of how to handle issues without closing the economy or impacting trade and investment policies, showing that dialogue is always best for conflict resolution. It was also clear that both bilateral and multilateral agreements are essential to guarantee economic growth to the benefit of society. Mexico has also secured its vaccines individually and through the UN, ensuring that these are not only distributed in powerful countries that have the necessary resources to produce these solutions but all around the world.