Mexico | Foreign investment review: strategic oportunity in the USMCA

Summary

Tensions surrounding the growing Chinese investment in Mexico present an opportunity to strengthen its regulatory framework for foreign investment review, and for the country to influence decision-making on the issue within the North American region.

Key points

• Key points:
• In Mexico, Chinese investment accounts for only 0.4% of total FDI received since 2006, but it raises concerns among trade partners due to the potential establishment of automotive plants and its involvement in strategic projects in the country.
• In the United States and Canada, Chinese investment is more significant, representing 0.5% and 2.7% of their total FDI in 2023, respectively, with China being the fifth-largest investor in Canada.
• Both countries have robust foreign investment review mechanisms for national security reasons. During the USMCA review in 2026, the United States and Canada will likely demand decisive actions from Mexico regarding investments deemed sensitive to them.
• In 2023, the United States and Mexico signed a Memorandum of Intent to jointly monitor foreign investments and create a bilateral group to exchange technical expertise on the matter.
• Mexico has the opportunity to modernize its regulations, strengthen the CNIE, and coordinate with its partners to oversee sensitive investments, promoting North America's competitive integration.

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