What is China‘s value added in Mexican manufacturing exports? The answer is 9.5%, according to the most recent data available from the Organization for Economic Co-operation and Development (OECD).
In general terms, the Mexican government aims to increase the value added in Mexico‘s exports. To this end, it seeks to encourage the arrival of investments to produce inputs and components. This strategy focuses mainly on certain industries such as aeronautics, naval, electronics, electrical manufacturing, iron and steel, metal product manufacturing and construction.
China’s added value
A study concluded that the increase in Mexico’s exports to the United States since 2018 was mainly due to companies with supply chains linked to China and the rest of Asia.
OECD data indicate an increase in China’s share of value added embodied in third-country exports. This growth reflects its influence in global value chains.
In Vietnam’s manufacturing sector, intermediate inputs from China accounted for 18.5% of its export value added in 2020. This percentage shows an increase from the 15.2% recorded in 2017.
China’s share of Mexico’s manufacturing export value added also grew. During the same period, it went from 8.1 to 9.5 percent.
In addition, a report by the U.S.-China Economic and Security Review Commission warns of possible illegal transshipments. According to this analysis, some Chinese exports could continue to enter the United States through intermediary markets.
Finally, the OECD has developed the Trade in Value Added (TiVA) concept. This tool is essential for analyzing and understanding the functioning of global value chains.
Regional integration
At the global level, Mexico’s Ministry of Finance and Public Credit (SHCP) believes that China’s economic recovery and the adoption of new technologies such as artificial intelligence in U.S. productivity could improve the outlook for international trade and demand for Mexican products.
Thus, the SHCP is confident that Mexico will continue to benefit from its integration with the North American region and the Treaty between Mexico, the United States and Canada (USMCA), maximizing opportunities in key sectors and strengthening its position in the bloc’s supply chains.