According to data from the U.S. National Statistical Office released on the 9th (local time), Mexico had the highest import of goods by country as of November last year, with $39.81 billion, followed by China with $35.49 billion.
Mexico ranked first with $438.986 billion in imports for the year before November, while China ranked second with $393.137 billion. Unless something unexpected happens, Mexico is expected to become the largest trading partner of the U.S. throughout last year, including December. The U.S. and China have continued to trade so closely that they are called one body economically. China accounted for 21.8% of U.S. goods imports until a year before March 2018. However, a drastic change followed former President Donald Trump’s inauguration in 2016 with the slogan “America First.”
Former President Trump began the trade war by imposing widespread high-rate tariffs on China, declaring the revival of his country’s manufacturing industry. The Joe Biden administration was launched in 2020, but it continued its protectionist stance by maintaining most of its high-rate tariffs. In July last year, China accounted for 14.6% of U.S. imports of goods over the previous year, the lowest since 2006. As of November last year, the share was further lowered to 13.9%. U.S. companies have also been reorganizing their supply chains in recent years in consideration of the U.S. government’s efforts to reduce their economic dependence on China and disaster risks. Mexico, on the other hand, has emerged as a strong competitor to China thanks to the U.S.MCA, a free trade agreement between the U.S. and Canada. Thanks to the agreement, Mexico can receive incentives under the U.S. Inflation Reduction Act (IRA). In particular, the need to shorten supply chains has increased since the COVID-19 pandemic, and Mexico’s wage level is between a quarter and a fifth of that of other North American countries. Mexico’s share of U.S. goods imports over the past year rose from 15% in July last year to 15.5% in November last year.
EJ SONG
ASIA JOURNAL
