Mexico the most to benefit out of China U.S. trade war

The tariff conflicts unleashed by the US federal administration, headed by Donald Trump, could represent an opportunity for developing nations, such as Mexico, Turkey, Indonesia and India, abound economists Leobardo Díez Martínez Guzmán and Rajid Luna, as well as businessmen Vinicio Montiel and Eury Valle Ruiz.

It is worth remembering that the so-called ” trade wars ” arose under the idea of ​​”making America Great again”, imposing an increase of tariffs on imports of Chinese products by 00:00 hours on July 6, 2018. 34 billion dollars, a decision to which the Chinese authorities announced that they would respond in the same way [

The first wave of Washington tariffs destined to 818 categories of goods imported from China included mainly components of the supply chain of the industrial and technological sector, and also aimed at several consumer goods, such as led light bulbs, electronic cigarettes, among others. .

Maquiladoras 

Although the supply chains do not change so quickly, accepted the president of the College of Economists of Sinaloa, Leobardo Martinez, there are contracts that would be revised. 

The world economy, in its immediate effects, would have direct repercussions for the Mexican economy, as it depends directly on the growth of the United States, said Diez Martínez. 

Likewise, since Mexico is a supplier of manufactures (components of televisions and automobiles), “they would be disastrous for the neighboring country of the north.”

The expert accused that the protectionist policies of Trump affected aluminum components originating in Mexico and Canada, so that the effects were proportional. 

Offer and demand

For his part, the economist and educator Rajid Luna warned that the US government intends that individuals no longer buy Chinese inputs; while the Asian giant, in response and as a measure of pressure, would impose encumbrances on American goods.

It is true that some countries could benefit, because they are the ones that will satisfy that need. If the United States does not buy China, and vice versa, there is room for other countries then sell it, “he said.

Even with Chinese taxes, it could be the case that the goods that could be supplied by other countries would be more expensive, Luna added. In this regard, labor in the People’s Republic of China will continue to be among the most affordable at the international level.

“They, therefore, can sell at much lower prices. With everything and tariffs, it could be cheaper for the United States to buy from China than from its neighbor. That is the part in which it could be convenient for small countries, but there is the possibility of maintaining the status quo, despite the tariff dispute, “he added.

The economist pointed out that Mexico is facing an opportunity and a challenge where the specialization in the processing of raw materials will play a decisive role: “With this, competitiveness would increase. Each time the cost of producing the goods and services would be cheaper, with lower prices. Given the tariffs of China and the United States, it is convenient for Mexico to offer a price in which it can fit in the vacant offers “.

Ultimately, Luna argued that Mexican maquiladoras should take the opportunity presented to them, as well as other sectors of the industrial sector.

Agroindustry and Sinaloa

In this sense, the president of the Association of Farmers of the South Fuerte River (AARFS), Vinicio Montiel Ibarra, assured that the market of fresh products and commodities is increasingly more complicated, with greater regulations and greater competition, so that the Levels of added value that are granted to production, in any sector, will be important. 

“It is the opportunity for Sinaloa to advance in the value chain and join higher-value market segments, where semi-prepared, frozen and sliced ​​products have a growing market niche,” he said.

In this order of ideas, Eury Valle Ruiz, president of the National Chamber of Industry and Transformation (Canacintra) in Los Mochis, commented that there is a gap for Mexico thanks to the harsh relationship that the United States has with China, currently governed by the president Xi Jinping.

“The immediate country to move forward would be Mexico. We have to generate industry conditions, especially in manufacturing, automotive and mining to take advantage of the dilemma, “said the representative of the private initiative to mention that the state has inputs (grasses, vegetables and vegetables) of high quality, with what the agro-industrial potential is remarkable.

Sinaloa can become a geographically well located point for the agro-industrial issue: everything that is extracted from the agricultural sector opens the door for the arrival and installation of companies dedicated to providing added value.

Finally, Valle recalled that the Mexican states that have achieved the greatest economic development are those with the highest indices of industrialization: “Strengthening the agroindustrial sector properly can provide Sinaloa and Mexico in a very important place based on this relationship,” he concluded. .

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