Since the mid 90’s Mexico has been a country that has bet its economic development on international trade, evolving from a semi-closed economy to one of total openness, and together with three of the world’s leading economies, signed a historic trade agreement, an agreement that allowed the three nations exponential growth, like any agreement some nations were more favored than others, but it is unquestionable that this agreement has served as an example to this day for hundreds of nations around the world, who have based their own treaties on the Canada-United States-Mexico agreement.
Much is written about the excellent relationship that Mexico forged with the United States after the signing of NAFTA (now: T-MEC-USMCA); however, little is written about the Mexico-Canada relationship. Although the commercial exchange between the two countries is impressive and is surpassed by few countries in the world, the increase in relations between Mexico and Canada cannot be ignored, as well as the great opportunities for growth that are foreseen for both.
Historically, Mexico and Canada began diplomatic relations in 1944, and have more than 61 Inter-Institutional Agreements signed by various agencies of both governments, which opens up the possibilities for collaboration. In addition, it is important to take into account that Mexico and Canada have two trade agreements, the T-MEC and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), with which the benefits for the companies of both countries are enhanced in a very relevant way.
There are many ties that connect both nations, in terms of migration, temporary workers, art, culture, cuisine, energy, mining, among many others, however, to contextualize more clearly, it is necessary to visualize some economic indicators, which present a realistic economic picture of the magnitude of trade relations.
Trade balance Mexico – Canada in thousands of dollars
Exports – Imports
Prepared by Asesores Stratego, SC, with data from the Ministry of Economy.
Source and preparation; Ministry of Economy.
The table and the graph show very clearly the economic evolution of the relationship between both nations, from $2,738,197 thousand dollars in 1993 to $19,493,333 in 2020, according to figures from the Ministry of Economy.
WHAT PRODUCTS ARE TRADE BETWEEN BOTH NATIONS
Mexico sells to Canada; aircraft, ships, transportation vehicles, machinery, mechanical appliances, sound recorders, players, electrical equipment, accessories related to sound equipment, vegetables, plants, trees, bulbs, roots, flowers, edible oils, fruits and citrus, coffee, spices, cereals, medicinal plants and oleaginous fruits.
Canada exports to Mexico: seeds, propane gas, aircraft parts and components, auto parts and plastics.
CANADIAN FOREIGN DIRECT INVESTMENT IN MEXICO
Canada is the third country that has invested the most in Mexico from 1999 to 2021, accumulating $45,508.6 billion dollars, and 4,204 companies duly registered with the Mexican authorities have established themselves in the country, representing 7.36% of the total foreign investment received. It can be seen as a poor representation, however, Mexico is a country with great attractiveness for investment, therefore, there are companies from more than 150 countries investing considerably in the country.
The states that receive the most foreign investment from Canadian companies are: Zacatecas, CDMX, Chihuahua, Coahuila, Guerrero, Sinaloa, Querétaro, EDOMEX, and Durango, with Mining being the main investment destination, followed by transportation, mail, manufacturing, financial services and electricity. It is estimated that almost 110,000 jobs come from these investments, from large companies such as; MAGNA INTERNATIONAL, SCOTIABANK, GOLDCORP, BOMBARDIER, and CELESTICA INC.
In Asesores Stratego we have extensive experience in supporting international companies wishing to invest in Mexico, if you want to learn more about the subject, or your company wants to invest in Mexico, regardless of the country where you are contact us, and one of our specialists will gladly assist you, providing the most professional advice and always taking care of your assets.
This document does not constitute a particular consultation, and therefore Asesores Stratego S. C., is not responsible for the
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