By: Daniel Nardini
During the Christmas holiday last year, I noticed something a little diffferent from past Christmas seasons at my nearest Walmart. This time there were more toys, TV sets, and furniture made in Mexico and the U.S.A. Samsung is now having high definition TV sets made in Mexico, and Mattel is having some of its toys made in Mexico. Some small companies were having some of their toys produced in the U.S.A. Still, the overwhelming majority of toys and TV sets and furniture were made in China, but there seems to be a shift in where some of these consumer goods are now being made.
There are a couple of reasons for this. First, the costs of manufacturing in China have risen while in Mexico they have largely stayed the same. Second, manufacturing in Mexico has become more efficient as the industrial sector has streamlined the process of getting consumer goods to market in the United States quicker. Finally, by geography Mexico is much closer so this means at present less cost of getting products made in Mexico into the United States than having it all shipped from China. One factor not always mentioned in this equation are the number of Mexicans living and working in the United States.
A growing number of Mexican immigrants and Americans of Mexican descent are professional business people who have helped foster business links with Mexico and have been influential in bringing in products from that country. Their economic links with Mexico actually extend well beyond that country into Central America. If Mexico lacks the resources for its growing manufacturing sector that countries in Central America have, then Mexican American enterprises will work with businesses in Central American countries to secure those resources. Of course, the big question is can Mexico replace China as the larger trading partner for the United States?
At present, Mexico is America’s second largest trading partner after Canada (although with all of the stuff we see made in China, it doesn’t seem like that). Despite all of the political turmoil going on in Mexico, its economic sector for now remains largely unaffected. Despite its distance, China is an economic as well as military superpower which Mexico is not. Yet Mexico is closer and has more economic ties with the United States. So it begs for the question, “Will Mexico be the bigger trading partner in America’s not-so-distant future?”
Mexico: The Bigger Trading Partner?
By: Daniel Nardini
There are a couple of reasons for this. First, the costs of manufacturing in China have risen while in Mexico they have largely stayed the same. Second, manufacturing in Mexico has become more efficient as the industrial sector has streamlined the process of getting consumer goods to market in the United States quicker. Finally, by geography Mexico is much closer so this means at present less cost of getting products made in Mexico into the United States than having it all shipped from China. One factor not always mentioned in this equation are the number of Mexicans living and working in the United States.
A growing number of Mexican immigrants and Americans of Mexican descent are professional business people who have helped foster business links with Mexico and have been influential in bringing in products from that country. Their economic links with Mexico actually extend well beyond that country into Central America. If Mexico lacks the resources for its growing manufacturing sector that countries in Central America have, then Mexican American enterprises will work with businesses in Central American countries to secure those resources. Of course, the big question is can Mexico replace China as the larger trading partner for the United States?
At present, Mexico is America’s second largest trading partner after Canada (although with all of the stuff we see made in China, it doesn’t seem like that). Despite all of the political turmoil going on in Mexico, its economic sector for now remains largely unaffected. Despite its distance, China is an economic as well as military superpower which Mexico is not. Yet Mexico is closer and has more economic ties with the United States. So it begs for the question, “Will Mexico be the bigger trading partner in America’s not-so-distant future?”