Imports of capital goods to Mexico from China accounted for 61.66% of total Mexican merchandise imports in 2021, according to the most recent data available from World Bank statistics.
That proportion has increased in recent decades from a coverage of 17% in 1994.
What are capital goods? Assets that are used in the production of goods or services over an extended period of time.
Imports of capital goods
These assets are not completely consumed in the production process, but are used repeatedly to generate economic value over time.
The following are some examples:
- Production machines.
- Industrial facilities.
- Office space.
- Software.
- Industrial equipment.
- Warehouses.
- Computer hardware.
- Specialized tools.
- Transportation vehicles used for the production or distribution of goods.
- Information systems.
Of the total imports of products to Mexico in 2021, 22% corresponded to consumer goods and the remaining 12% to intermediate goods. In 1994, this ratio was 62% and 21%, respectively.
Trade
In 2023, Mexico imported products from China for US$114.188 billion, a year-on-year decrease of 4 percent.
Conversely, Mexican exports of goods to the Chinese market were 9.151 billion dollars, a 15% drop over 2022.
While China was the third largest destination for Mexican exports in 2023, after the United States and Canada, China ranked as the second largest foreign supplier of goods to Mexico, surpassed only by the United States.
With growing competition from Latin America and Chinese demand for imports expected to slow markedly due to a combination of weaker economic growth and population decline, expanding trade to Canada and Mexico could present the greatest opportunity.
This will also affect the export product mix, as nearly half of Chinese agricultural imports from the United States are soybeans, while the import mix from Canada and Mexico is more diverse.
As a result, soybean exports are expected to decline 4% over the next 10 years and by 2033 soybeans‘ share of total U.S. agricultural exports could be reduced.