Surprised, I read that the Mexican government “chose to move value chains to boost the country’s economy.” According to some of the articles referenced, in recent statements by the Secretary of the Treasury, Rogelio Ramirez de la O, he referred to the opportunity that this relocation represented for Mexico, given its relations with the outside world and its privileged geographical position. in which it is located. He finds the country because of its proximity to the world’s leading economy.
According to the article consulted, the secretary was participating in a conference organized by the Society of the Americas Council of the Americas (ASCOA).
And in this, the President referred to this marked trend at the global level, which some call “approximation”, which consists of a global reorganization of various supply chains in the face of what happened with the crisis caused by the pandemic. That is, at a time of economic stagnation such as the current situation, when the country is looking for new economic drivers and foreign investments, the reorganization of these chains can represent a unique opportunity for a country that, in light of data and agreements, has a clear attractiveness in international markets.
But, first of all, it is convenient to stop and find out what we are referring to and what the chief means by the word “transport”.
In this context, it must be said that since the outbreak of the crisis, this dependence on the Asian continent, where more than 35% of global industrial production is concentrated, has forced many countries to suffer from shortages. Condemned by the highly concentrated supply chain in the Asian lands, the global plant was forced to shut down, causing severe disruptions after the opening that led to bottlenecks and distortions in supplies, which, while operable, prevented companies from getting enough product to be able to Doing this with normal a few years ago.
In other words, China was not able to generate enough supply to meet the strong demand which was energizing the various economies which are supplied from this “world factory”.
This fact, which strongly influenced the world’s population, and even generated protectionist sentiments in many leaders around the world, aroused the desire that gave rise to the aforementioned trend. Well, faced with the prospect of new shutdowns that could lead to new shortages, countries began to work on relocation aimed, first, at diversifying the value chain around the world, and secondly, bringing it closer to the destination in the world. Faced with the possibility of bottlenecks re-emerging in the future, merchandise, in China for inaction, may remain stagnant and without access to the final consumer.
Considering that Mexico is a country very close to the United States, and its economy is closely linked to the neighboring country thanks to trade agreements that have made it the main trading partner of the world’s leading economy, many companies intend to reorganize their chain could see in Mexico an opportunity for diversification, and by the way , to approach an economy like the United States. In other words, Mexico will not only be an option to diversify and reduce that dependency, but it may also be an opportunity to establish relationships with an economy that is positioned as the world’s largest buyer.
In addition, it must be said that we are talking about an economy that has made a strong commitment to the foreign sector, and practically trusts its economy to move forward. The data throughout these years of the pandemic justify what is being cited.
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In this sense, Mexico is a country that subordinates nearly 80% of its GDP to the foreign sector. The sum of imports and exports accounts for nearly the majority of its economy, and only those related to exports actually account for nearly 40% of GDP. In other words, we are talking about an economy that is very liberal in terms of trade, and with significant participation in international markets. The trade relations that it has established, as well as that important relationship with the world’s leading power and its neighbor, the United States, have allowed the country to turn the foreign sector into a clear economic engine.
For all of these reasons, I celebrate the Secretary’s words, while remembering the times we’ve commented on this opportunity in our column all these months. It presents a historic opportunity to boost the Mexican economy, relying on companies that, in addition, can return foreign investment to optimal levels, which continues to decline over time. Moreover, at a time of stagnation and lack of growth, this opportunity acquires a lot of importance.
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