USMCA Review Aims to Curb China’s Expansion in Latin America

During the USMCA review, a key priority will be addressing China’s commercial and economic relationship with Mexico, with the goal of limiting Chinese trade and investments in Latin America, according to Larry Rubin, President, American Society of Mexico (ASM).

Larry emphasized that China’s investments could derail Mexico-US relationship, as the US aims to remain the leading investor in Mexico. He noted that the triangulation of Chinese trade to Mexico through companies in South America has been detected, making it difficult to quantify the extent of Chinese-origin investments entering the country.

“China’s investments in Mexico are a major concern for us. China has already become the most important trading partner in Latin America, taking on that role over the past few years, and the Chinese wave is now reaching Mexico. Therefore, in the United States, we want to ensure that we remain the country's principal trading partner,” Larry said.

China-Mexico Trade Relations

Mexico is China's second-largest trading partner in Latin America. According to Banxico, China's share of Mexico's exports was 1.7% in 2023, amounting to US$10.058 billion, while its share of Mexico's imports was at 1.9%, totaling US$114.190 billion. This imbalance resulted in a trade deficit of US$104.132 billion for Mexico. Rogelio Ramírez de la O, Minister of Finance, highlighted the lack of reciprocity in the trade relationship, "China sells, but does not buy."

Ramírez de la O highlighted that China's significant growth in global exports—from 3.8% in 2001 to 14% in 2022—has come at the expense of North America's market share. In 2000, the United States, Mexico, and Canada together accounted for 19% of global exports, a figure that fell to 13% by 2022. The region also remains heavily reliant on Chinese imports: the United States at 16.5%, Canada at 13.5%, and Mexico at 19.6%. "This situation has led to a growing sentiment in both the United States and Mexico to protect our domestic industries," Ramírez de la O emphasized.