Mexican minister dismisses China FTA
Development: On 22 December the economy minister, Gerardo Ruiz Mateos, said that it would be “suicide" for Mexico to sign a free trade deal with China.
Significance: In Ruiz Mateos's view Mexico is an industrialised country which competes with Chinese companies to sell manufactured goods. Ruiz Mateos, almost dismissively, said that it might be sensible for “predominantly agricultural exporters such as Brazil or Argentina" to sign a FTA with China but it would not be so for Mexico. Peru and Chile are the only two Latin American countries which have FTAs with China, though Costa Rica is considering one.
Ruiz Mateos said an FTA between Mexico and China would be suicide for Mexican industry. He noted that he had announced on 19 December, that Mexico was to tackle China at the World Trade Organization over China's unfair subsidies of manufactured goods. Ruiz Mateos said that he hoped for a friendly solution but warned that Mexico would not shy away from calling for a disputes' settlement panel if China did not deliver what Mexico wanted.
Ruiz Mateos noted that Chinese investment in Mexico was negligible. He said that the European Union had invested US$12bn in Mexico in 2006, but China had invested just US$70m in the same period. Furthermore, he claimed that this investment was staffed entirely by (400) Chinese, so the investment had produced no jobs for Mexicans.
Mexico exports only about US$1.8bn in goods to China but imports around
US$31bn of goods from it.