Mexico promotes 'nearshoring' to Trinidad and Tobago, Caribbean market

The government of Mexico is promoting what is known as "nearshoring," in which companies reduce their costs by subcontracting companies abroad in countries relatively close by to outsource their services.

Until a few years ago, there was talk that countries should take advantage of production chains in distant markets, but the rethinking of post-pandemic globalisation has led the economic sector to take advantage of short commercial chains to generate short-term results and with less investment.

The Mexican ambassador to TT, Barbados and Suriname, Víctor Hugo Morales, told Business Day his country is trying to use nearshoring for the Caribbean area, under the North American Free Trade Agreement. That allows access to larger markets, thanks to the industrial capacity of Mexico.

"Mexico intends to make the best use of this system with these trade agreements between our country, the US and Canada, which can be used by investors from TT and the Caribbean region to continue their process of commercial growth."

In this sense, Morales said his country is promoting economic agreements in TT from three specific points: commercial, private and services.

Morales was appointed ambassador to TT in April, and since then, he said, he has been able to observe TT has a solid economy based on the exploitation of hydrocarbons, which has given it the capacity for economic wealth.

“This country is very relevant for Mexican foreign policy, because TT has a relevant role in the Caribbean, and from there, can initiate various activities,” he said.

For Mexico at present the main drive is commercial. Morales said he had held meetings with Paula Gopee-Scoon, the Minister of Trade and Industry, to present some initiatives.

“Mexico is TT's eighth commercial partner in the world, and the purpose is for this relationship to reach fifth place, in the medium term, focusing on linking the TT market with possible Mexican associates. We are promoting meetings with Mexican and TT businessmen, a trade mission in which the opportunities and advantages of this market can be exposed,” he said.

Morales considers TT has very high imports and Mexico is an exporting country, but its currently in deficit.

“We are especially buying methanol. It is the main product that generates a surplus for TT in trade with Mexico,” he said.

However, he recognised Mexico has not been able to open its market as expected. “That's why we think we can put excellent Mexican products in the TT market, such as automobiles,” he said.

Mexico is the sixth largest automobile producer in the world and the fourth largest exporter in the world, which could be an excellent gateway for TT.

Appliances produced in Mexico can be supplied to the TT market.

“I also spoke with Minister Gopee-Scoon about Mexican investments. We are thinking of signing a memorandum of understanding to promote private investment,” said Morales.

He gave TCL as an example, a local company whose shareholding is majority-owned by Mexico's Cemex, one of the largest cement companies in the world.

“In this sense, we are evaluating how to make the TT market more attractive to diversify productivity and boost Mexican capital in this country,” he said.

As the third point of investment between the two countries, Morales mentioned the sale of services to support TT industry such as hydrocarbons and methanol, among others, where Mexico has proven capacity through technicians and specialists.

“We are working on important economic and business plans between the two countries we are sure will contribute to the advancement of both nations as a team.”