In a visit to a friend in Merida, Yucatan Mexico we found ourselves talking about Chinese motorcycles in a serious way. He fixes, bicycles, motorcycles and cars in his small shop.
He had harsh words for Chinese motorcycles that for him, are a travesty in quality that threatens his work because he says that it is much more expensive to fix them than what they are worth. These cheap motorcycles are inundating the country with little hope of reversing the trend.
I mentioned that we in the United States had had the same experience with the cheap products that helped Japan rise from the ashes of World War II. Eventually Japanese production reached the highest quality that competes well with Europe and America.
I also offered that importing Japanese imperfect goods was also a political decision designed to help an ally that had been reborn as a democracy. That ally is now a strong political partner in confronting the Chinese authoritarian regime.
That led to my observation that it appears that Mexico’s problems with Chinese products are more than the quality of imports. There seems to be a major political problem not so much with being a consumer of Chinese imports but with the partnerships that were built to produce Chinese goods in Mexico.
The United States-Mexico-Canada (USMCA) Treaty provides for a North American block designed to boost international economic competition with the rest of the world. The agreement leaves Mexico at the heart of the North American industrial production for the markets.
In the last few years, China commercial interests have gotten into the Mexican economy in a growing way, not only as a consumer country but also as a partner in producing Chinese goods, particularly cars, for export purposes. That is creating a major political problem that threatens the trade agreement itself.
Trade agreements basically are expressions of shared political interests encapsulated in economic relationships that favorite countries have with each other. In this sense, it is rational that the defense of the United States and North America include a trade agreement that furthers the political and economic interests of the participants.
The trade agreement is threatened because China is the political enemy of both the United States and Canada. Mexico, on the other hand, is open to all countries and expresses in its Constitution the non-interference in the affairs of other states.
The United States-Mexico-Canada trade agreement is up for review in 2026. In addition to labor and production issues, the negotiations will no doubt include restrictions on China economic interests in North America.
In addition to the fact that Mexico is already deep into Chinese economic initiatives, there is the sensitive question of Mexican sovereignty and ability to make decisions apart from trade agreements, United States and Canadian foreign policies. The issue will require a lot of work to balance the political and economic interests of the three signatories.
It is clear that China needs Mexico to compete in the global marketplace. Although Chinese labor is less expensive, in the long run, the transportation of goods across the Oceans diminishes whatever advantages they have in producing at home for shipment abroad.
President-elect Trump is promising a strong reaction to these economic activities beginning with heavy tariffs on products from countries that cooperate with China. That creates a dilemma for the new Sheinbaum administration.
It is clear that what is called the 4th transformation in Mexico is being tested within and without. It is also true that Mexico has a Chinese problem.
The views expressed by David Conde are not necessarily the views of LaVozColorado. Comments and responses may be directed to News@lavozcolorado.com.
