President Donald Trump’s tariffs will affect the nearshoring in Mexico and North America, projected Index.

“At Index we see a huge risk from this imposition, as it unprotects thousands of jobs, will unbalance supply chains and generate uncertainty in the current business relocation scenario,” it said. 

The relocation of U.S. supply chains involves a shift in the use of foreign suppliers, especially those located in Asia, to suppliers more strategically located in the Western Hemisphere. This shift has been driven by several factors, including ongoing political tensions with China and historical difficulties in receiving inventory from Asian suppliers during and after the Covid-19 pandemic.

Nearshoring

A clear example of this trend is that Mexico has overtaken China to become the United States‘ largest trading partner in dollar terms. This shift reflects greater diversification and restructuring of supply chains in favor of geographically closer partners.

According to the Index, the future of North America is at a key moment. The bilateral and trilateral relationship depends on a good understanding. Thousands of companies, millions of workers and a great deal of investment depend on it. 

The Index, a civil association founded in 1973, brings together 18 local associations. It represents approximately 1,300 companies under the IMMEX program, designed to boost Mexican exports.