As Biden is about to arrive, Mexico reaches out to China


Specialists consider that Trump has not exerted so much pressure in relation to Asians; businesses are maintained with the purchase of trolleybuses and modernization of the Metro

The trade war that United States President Donald Trump started against China has so far
not affected the arrival of companies from that Asian country to Mexico, or doing business,
specialists agreed.

For Sergio Ley, Mexican ambassador to China from 2001 to 2007, interaction with Chinese
organizations has not generated US pressure on Mexico either, as was seen in the past six
years, when at the end of 2014 the concession of the Mexico-Querétaro train was revoked.
company China Railway Construction Corporation (CRCC).

The now president of the Business Section for Asia and Oceania of the Mexican Foreign
Trade Council (Comce) recalled that during the administration of Enrique Peña Nieto, the
US government of Barack Obama pressured the country to limit the entry of Chinese
companies, but “ in that this regime [that pressure] is much less ”.

Ley added that it is not expected that with the arrival of the government of President-elect
Joe Biden, the pressures “will be as crude” as before.

Meanwhile, Mexico’s business with China continues. A few weeks ago, the Ministry of
Economy announced the elimination of tariffs on the importation of electric trolleybuses,
which coincided with the announcement by the Government of Mexico City that these
vehicles will be purchased from a company in that country.

In addition, this Friday the Metro Collective Transportation System awarded the contract to
modernize Line 1 to the Chinese consortium CRRC Zhuzhou Locomotive, following the
resignation of CAF.

In mid-November, through an executive order, Trump banned Americans from investing in
31 firms linked to China’s military, including CRRC.

This week, the US ambassador to Mexico, Christopher Landau, called on the government
and the national telecommunications industry to join the US initiative Red Limpia and only
hire “reliable providers” for 5G networks.

That proposal leaves out Huawei, a Chinese firm that has operated in Mexico for 20 years.
Regarding what was said by Landau, Sergio Ley said that it is part of the American “song”
regarding which Chinese companies want to steal information.

“We must lookout for the best interest of Mexico, and if that is to get the best technology,
at the best price, that is the path that the country should follow.

Limited Exposure

For the coordinator of the Center for China-Mexico Studies (Cechimex) at UNAM, Enrique
Dussel Peters, the participation of the Asian country in the national territory is very limited.

Foreign direct investment (FDI) represents less than 1% of all capital raised between 1999
and 2020, he said. Funding is minimal and there are practically no Chinese investments in
infrastructure because most of it goes to the service sector.

“The investment in Mexico in infrastructure projects has been very bad,” he explained, as
seen in projects that could not materialize, such as Dragon Mart, in Cancun, and the
Mexico-Querétaro train, among others. “We are full of failures,” he commented.

He affirmed that China is important as a supplier because it is Mexico’s second
commercial partner. Given this, the best thing will be “that the United States does not put
us in its fights and, if it wants, that it fights with China.”

Intense Rivalry

The former head for the country of the renegotiation of the North American Free Trade
Agreement (NAFTA), now USMCA, Kenneth Smith Ramos, affirmed that the United States
and China faces a war in several areas.

It is a kind of “cold war, around who is going to control technologies, telecommunications,
semiconductor production.” Everything is at stake ”.

He explained that under the Trump administration and during the NAFTA renegotiation, the
The United States tried to impose an “anti-China” clause, but Mexico and Canada refused
because it violated their sovereignty.

In the end, it was agreed that if a free trade agreement is negotiated with a non-market
economy, the details should be shared with the other two partner countries, and if one of
them thinks it is contrary to their interests, they can get out of the pact. .

Smith Ramos specified that it was not defined what a market economy is, and he sees
very unlikely that Mexico wants to have a treaty with China because it is considered a

Biden will face a minefield, he added, as he will have to bring China to the negotiating
table, and to succeed in respecting intellectual property.

The general director of the Institute for Industrial Development and Economic Growth,
José Luis de la Cruz explained that Biden has already made it clear that for the United
States China represents one of its greatest challenges since the relationship goes beyond
the economic. Given this, Mexico must define its policy with Asia.


Mexico Daily Post