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Aaron Rodriguez highlights the growth occurring in the Mexican commercial sector

For decades, Mexico’s foreign commerce has been one of the main drivers of national economic growth and development. Today, foreign commerce represents close to 65% of the national GDP and exports, around 30% (double the 1986 levels). Mexico’s presence in world trade began in the 1980s, with the opening of the economy and the adoption of an export-oriented development model, which has led to the incorporation of Mexican production into global production chains. Aaron Rodriguez, a specialist in Latin American commerce, highlights the growth that Mexico’s commercial sector is experiencing.

Mexico ranks among the top ten players in international trade; in 2013, it was the tenth-largest exporter and ninth-largest importer worldwide, and first in both categories among Latin American and Caribbean countries. In that year, Mexico contributed 2.02% of world exports and 2.07% of world imports, equivalent to its contribution to world GDP (around 2%).

Likewise, in 2014, Mexico’s commerce with the world totaled almost 800 billion dollars, $397 billion for exports and $399 billion for imports, and captured foreign direct investment for $22 billion, which kept it as the second recipient among Latin American countries and 13th worldwide. In the early 1980s, oil and its derivatives accounted for 70% of the value of exports.

Today, the manufacturing sector contributes more than 86% of total exports. Likewise, Mexican imports multiplied 33 times, going from $12 billion to more than $399 billion in the same years. Of the total imports made by our country, 75% are inputs and 11.5% is equivalent to machinery and equipment used to maintain a competitive export platform.

“These figures reflect not only the place Mexico occupies in world trade, but the relevance of foreign trade as an engine for the growth of the Mexican economy,” Rodriguez points out. “Foreign trade has been a factor of growth and development, especially for those regions, sectors, and companies in the country that have been able to integrate directly or indirectly into this activity.”

Through international trade, the production plant has been able to integrate into the global production chains where most of the exchanges take place. In fact, trade in intermediate goods generated by global value chains already exceeds that of final goods and represents more than 60% of world trade flows.

Not all countries and regions have been equally able to maximize the opportunities and benefits offered by international commerce since not all have been able to link up with global manufacturing chains.

In fact, the integration of the states and regions in the north and center of the country into global production chains has accentuated the already existing differences between the “different Mexicos,” as it has made more evident the disparities between regions, sectors and companies in the country that have not yet been able to find a place in these.

“Mexico’s foreign trade has been characterized by high levels of concentration,” Rodriguez details. “In terms of states, the northern and central states have a greater share, and these are where the companies that export are located. In terms of sectors, the automotive and electronics sectors stand out, accounting for almost half of manufacturing exports and, in terms of export destination, these are concentrated in the US market, the world’s main importer.”

This has led to the positive effect of Mexico’s foreign trade, generating virtuous circles of exports and growth, especially in those regions that have been able to effectively link themselves to international markets through exports and the attraction of foreign direct investment.

The geographical proximity to the US. market explains the advantage that the northern states have over the rest of the country to participate in export activity. Likewise, the maquiladora export industry that began in 1965 was located in the states bordering the US, which has also given them an advantage over the rest of the country.

The challenge, however, lies in incorporating those states that have so far remained on the margins of export activity. This point is essential because, since national growth and development are linked to international trade, exports, and the attraction of foreign investment flows, the states and regions that do not integrate will be left behind in their growth possibilities.

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