The trade relationship between Mexico and China has evolved significantly, positioning both countries as strategic partners in global trade. As the world becomes increasingly interconnected, trade relationships play a crucial role in economic dynamics, facilitating the exchange of goods and services.
In 1972, Mexico and the People's Republic of China established diplomatic relations, marking the beginning of a new era of political and economic collaboration. Since then, both countries have intensified their cooperation through bilateral agreements, such as the "Comprehensive Economic Cooperation Plan," and their participation in multilateral organizations like the World Trade Organization (WTO).
These efforts have expanded trade opportunities in sectors such as technology, mining, renewable energy, and shelter services in Mexico.
*Considered in the analysis are over 38 countries from Asia, including major trade partners such as China, Japan, South Korea, and India.
China is a leading supplier of electronic products, machinery, and vehicles to Mexico. In 2023, Chinese exports to Mexico reached $81.56 billion, with electronic equipment accounting for $22.33 billion. Additionally, sectors such as furniture, plastics, and chemicals have also experienced significant growth.
*Total imports from China (USD mn: Monthly: Mexico) refers to the total value of goods imported from China to Mexico, measured in millions of U.S. dollars, on a monthly basis.
On the other hand, Mexican exports to China, which include minerals such as copper and zinc, electronic equipment, and vehicles, totaled $18.74 billion in 2023. The agro-industrial sector also stands out, with products like avocados and pork gaining popularity in the Chinese market.
Source: Oxford Economics with data from the Chinese Ministry of Commerce
Manufacturing in Mexico, including the automotive industry, and renewable energy stand out as key areas where bilateral collaboration is growing.
Chinese foreign direct investment in infrastructure, such as industrial parks and solar power plants, is transforming regions like Nuevo León and Baja California into industrial hubs. (Also, over $1.5 million worth of goods cross the U.S.-Mexico border every minute, highlighting Mexico's strategic advantage for companies —like the Chinese ones— targeting the U.S. market!).
*The data in this chart represents announced investment transactions. It does not necessarily indicate whether the projects have been fully developed or if the funds have already been disbursed. If you want to see a comparative report with official data registered by the Mexican Ministry of Economy, click here.
Sectors such as e-commerce, artificial intelligence, and renewable energy are expected to drive bilateral growth. Companies like Alibaba and Huawei have already shown interest in expanding their operations in Mexico, leveraging its strategic location and skilled workforce.
The USMCA (T-MEC) review in 2026 could redefine China's role in Mexican supply chains. Possible scenarios include:
The new Mexican government has announced projects aimed at strengthening infrastructure and promoting industrial parks that support nearshoring. These initiatives could establish Mexico as a hub for nearshoring for Chinese companies looking to access the North American market. Examples include:
Source: Mexican Government Report
Proposals such as the creation of a foreign investment oversight mechanism could balance national security concerns with the economic benefits of Chinese investment. Additionally, tax incentives are being considered to attract more foreign capital in technological and energy sectors.
The growth of Chinese investment has also raised concerns regarding national security, particularly in sectors such as telecommunications and mining (however, did you know that only 0.4% of Chinese FDI in North America went to Mexico (2016-2023), while the U.S. received 68.1% and Canada 31.5%?). Companies like Huawei and ZTE have been scrutinized for their potential ties to the Chinese government.
To mitigate risks, a system similar to the Committee on Foreign Investment in the United States (CFIUS) has been proposed, which would evaluate foreign investments in critical sectors.
The Mexico-China trade relationship demonstrates how stability and trade diversification can benefit both economies. Looking ahead, greater technological and sustainable sector integration will be driven by global market needs and supply chain shifts.
However, challenges such as geopolitical tensions and foreign investment transparency demands persist. Balancing economic cooperation with national interests is key for companies doing business in Mexico will be key to ensuring long-term mutual benefits.
Despite hurdles like the USMCA review and security concerns, strengthening ties with China can support Mexico’s North American strategy and unlock significant economic growth opportunities.