Mexico’s President Claudia Sheinbaum addressed concerns on Thursday regarding the intentions of a Chinese firm to establish an automobile manufacturing facility in Mexico. She confirmed that such plans do not currently exist.
In a recent discussion with Canadian Prime Minister Justin Trudeau, Sheinbaum learned that he does not support the idea of excluding Mexico from the U.S.-Mexico-Canada trade agreement, often referred to as USMCA. This dialogue followed a call from provincial leaders in Canada urging Trudeau to pursue a bilateral trade deal with the United States that would leave Mexico out of the negotiations.
“The prime minister has clearly indicated he does not wish to exclude Mexico from the treaty,” Sheinbaum stated after the bilateral talks during the G20 summit.
Sheinbaum recounted a conversation with Trudeau regarding the alleged Chinese automobile manufacturing facility. Responding to his inquiry, she clarified that the only North American facility belonging to the company in question is located in California. This conversation likely referred to Chinese automotive manufacturer BYD, which had been rumored to consider a plant in Mexico but has not yet taken any concrete steps.
Concerns from politicians in both the United States and Canada revolve around the possibility that, under USMCA, Chinese manufacturers could set up operations in Mexico and subsequently transport goods to North America while circumventing tariff regulations.
During a conference call on Wednesday, Doug Ford, Ontario’s premier, led discussions with the 13 provincial and territorial leaders, expressing their desire for Trudeau to initiate a separate trade agreement with the U.S., considering it their primary trading ally.
“The consensus is strong: there’s an urgent need for a direct trade agreement with the U.S., as well as a separate one with Mexico,” Ford communicated during a press briefing in Toronto after the leaders’ call.
He also voiced concerns over Mexico reportedly importing inexpensive parts from China, labeling them with “Made in Mexico” tags, and distributing these products to the U.S. and Canada, which he claims is detrimental to North American jobs. “We are advocating for fair trade practices,” he affirmed.
Sheinbaum suggested that the push for a bilateral agreement could be rooted in local political dynamics in Canada, indicating that such issues are often leveraged during election campaigns.
Although there is a vehicle assembly facility established by Giant Motors in Mexico, which produces JAC brand automobiles primarily from imported components, it remains unclear whether this plant contributes significantly to exports to the United States or Canada.
Meanwhile, on Tuesday, Canada’s Deputy Prime Minister Chrystia Freeland expressed alignment with U.S. worries about Mexico potentially facilitating access for cheaper Chinese products into the North American market. She noted that members of the outgoing Biden administration and advisors to President-elect Trump have conveyed serious concerns regarding this matter, which Canada recognizes as significant.