USMCA is crucial for value chains in Mexico

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Nearshoring and USMCA, keys to value chains

The Mexican Association of Industrial Parks (AMPIP) emphasizes the importance of attracting investment to the country and, to this end, is moving from free trade to trade administration, to give rise to the interdependence of value chains between strategic partners.

Emilio Cadena, CEO of Grupo Prodensa, revealed his vision for manufacturing in an interdependent global, regional and local supply chain that synchronizes the economic cycle between Mexico and the United States, resulting in deeply interconnected cross-border manufacturing.

Given the current global situation, the executive recommended that exporters improve health protocols, remain aware of the actions of the United States during its industrial recovery, monitor the exchange rate and address labor issues related to establishing safety measures in companies, as per Health and Safety Guidelines in the Workplace.

In addition, the executive stated that, in order to stabilize the value chains, it is necessary to attract investment from China, as it is an essential partner in the value chains; to increase industrial plant capacity; to adopt digital transformation processes; transport and construction equipment; as well as infrastructure availability due to the gradual reopening of plants, after the impact of Covid-19.

Nearshoring: an option for Mexico

Kenneth Smith, partner at Agon and former chief negotiator of the USMCA for the Ministry of Economy, said that the era of offshoring is in decline, so it is crucial to convince the U.S. to invest as nearshoring in Mexico is desirable and profitable.

According to Smith, companies are naturally going to start bringing value chains closer to the country to prevent businesses from collapsing in the face of a pandemic like the one we are experiencing. Therefore, Mexico may become a very attractive investment location that supplies the U.S and domestic market and will also be a springboard for other regions of the world.

In addition, the specialist mentioned that the country’s risk should be reduced by means of public policies developed in favor of investment, regulatory independence, proper implementation of the treaty and positive cooperation between the government and the productive sector.

He assured that the USMCA is a treaty that will raise competitiveness to the extent that the United States, Canada and Mexico will honor their commitments and our country will implement the required public policies.

Aspects to promote economic recovery

– Take advantage of the Trans-Pacific Partnership (TPP) and the Pacific Alliance to promote exports and attract investment

– Correctly implement the USMCA with a firm position towards the United States and not allow global chains that put Mexico at risk.

-Continue negotiations with Brazil and Argentina.

For all the above reasons, the strategic advantages that Oradel Industrial Center offers to international companies make it a significant player, due to its strategic location 10 minutes away from the international crossings with the United States.

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