Trade Agreements
Mexico is a member of the World Trade Organization (WTO) and has 13 free trade agreements (FTAs) that cover 50 countries, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). It was the first country in Latin America to sign a partnership agreement with the European Union. In addition, the USMCA Agreement (previous Nafta) encourages US companies to set up manufacturing facilities in Mexico. This allows free trade between the three major economies in North America.
Accordingly, manufacturing companies are significantly increasing in investment into Mexico which makes them of one of the most competitive and open market in the world.
Some Hard Facts
- Over 50 trade agreements
- No other country than Mexico has more trade agreements
- USMCA Agreement is key for nearshoring
- Asian companies take advantage of USMCA agreement
- International Standards must be followed with the USMCA agreement
Trade Agreements European Union
No other countries than Mexico has signed more free trade agreements and it was the first country in Latin America to sign a partnership agreement with the European Union (1997). At least 47 in North, Latin America, Europe and Asia allows free flow of goods and services and is therefore very attractive to start your production, your service or distribution center. They have removed several non-tariff barriers and reduced import duties on exports.
In 2020, the European Union was Mexico’s third largest source if imports, just after the United States and China. This includes machinery, appliances, transport equipment, chemical products, computer and information services. In the same year, the European Union was Mexico's second-biggest export market after the US. The EU's key imports from Mexico are machinery and appliances, transport equipment, optical/photographic instruments, and mineral products. As a foreign direct investment, the EU is the second largest investor in Mexico after the US.
