PetersonBrown Group - China considers free-trade with Mexico

China considers free-trade with Mexico

Kane Davis Cooper  ̶  Reports from the official Chinese news agency Xinhua suggest that China is amenable to discussing a free-trade agreement with Mexico. This is welcome news for Mexico as uncertainty surrounds its future relationship with its nearest neighbor and largest trading partner- the United States. China’s ambassador to Mexico, Qiu Xiaoqi, was talking at an academic event in the Mexican capital city.

“If we negotiate a free-trade agreement, this will greatly favor trade exchanges between our two countries. There is no difficulty from China’s side,” he said.

“Mexico is China’s second-largest trading partner in Latin America and China is Mexico’s second-largest trading partner in the world. This is a highly important relationship and we have great interest in deepening and broadening these ties.”

Mexico is looking for alternatives so that it can reduce its economic dependency on the US out of worries that the policies of President Donald Trump and his America First pledge may lead to more limited trade conditions with their northern neighbour.

China and Mexico have been reinforcing bonds since late last year at the same time as the United States has taken a step backwards from established global trade agreements such as the Trans-Pacific Partnership (TPP).

The US President has also made threats to pull out of the North American Free Trade Agreement (NAFTA) with Canada and Mexico. At present, four-fifths of all goods leaving Mexico are bound for the US.

Since his initial inflammatory comments, President Trump has toned down his rhetoric somewhat and has now voiced optimism that when the NAFTA is renegotiated, which is pencilled in for August, it could become beneficial for all sides.

After what had previously been seen by many as a hot and cold view of China by Mexico, the boost given by the Chinese ambassador’s statements is a positive lift for Mexican President Enrique Pena Nieto.

“I think any agreement to make trade easier is very worthy,” Qiu told the waiting press following his speech at the National Autonomous University of Mexico to celebrate the 20 years that have now passed since Hong Kong returned to Chinese control.