Mexico's Claudia Sheinbaum has unveiled a plan to reduce its reliance on Chinese imports and bolster domestic production as part of an effort to address U.S. concerns and maintain favorable trade relations under the United States-Mexico-Canada Agreement (USMCA).
The initiative, led by Mexican President Claudia Sheinbaum, is seen as a response to President-elect Donald Trump's incoming administration, as members of Trump's team have expressed concern about China's growing role in Mexico's economy and the president-elect himself has vowed to use tariffs as a means to force other countries hands once he takes office.
"Our objective is to expand to the entire American Continent, which is the vision we want to have in order to be the region with the greatest potential and development in the world," Sheinbaum said on Monday, revealing the plan is part of a broad pro-growth agenda which she said would help increase investment and make Mexico one of the world's top 10 economies by 2030, up from 12th currently, as Reuters reports.
"Plan Mexico," introduced by Sheinbaum, targets sectors such as textiles, electronics, and automotive components to reduce a trade deficit with China that reached $105 billion in 2023. The plan proposes increasing domestic production and includes measures like substituting 15% of sewing thread imports with local alternatives.
The announcement comes two weeks after Mexico implemented a 19% duty on goods arriving through courier companies such as Chinese giants Temu and Shein. That measure, plus a December decree which imposed tariffs of up to 35% on a range of Chinese goods, including clothing and home items, has fueled speculation that the Mexican government is doing its part to appease the Trump administration, regardless of the somewhat tense relationship between the Republican and Sheinbaum so far.
Concerns about Chinese involvement in Mexican supply chains are longstanding and Chinese firms have increased investment in Mexican manufacturing, particularly in the automotive sector, where they provide parts and components that meet the three-nation USMCA agreement.
"It's been demonstrated to be one of the best trade deals in history, it benefited the three countries," Sheinbaum added on Monday. "It's the only way that we can compete with Asian countries, in particular with China." Elsewhere, Sheinbaum also announced plans to bump investments up to 28% of GDP, adding 1.5 million manufacturing jobs by boosting local production and cutting red tape.
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