Mexico Gaining From Competitive US Manufacturers Scott Rose - Bloomberg News
go to original August 30, 2012

Mexico is benefiting from ties to “very competitive” U.S. manufacturers as low wages lure producers discouraged by rising labor costs in Asia, Deputy Finance Minister Gerardo Rodriguez said.

“Many companies are shifting their production capacity back into the U.S.” and adding manufacturing jobs at a “good pace,” he said in an interview in Moscow today, where he was attending a meeting of officials from the 21-member Asia-Pacific Economic Cooperation group.

Mexico is tied to the U.S. by the North American Free Trade Agreement that bolstered cross-border production chains. “Because of these linkages with the Mexican sector, we’re being pulled somewhat by those dynamics,” Rodriguez said.

After trailing growth in Brazil during the past decade, Mexico is poised to outperform Latin America’s biggest economy for the second consecutive year in 2012. Manufacturers are opening new plants in Mexico as wages in China rise and higher oil prices increase transport costs for Asian companies looking to tap consumers in the U.S., the world’s largest economy.

The peso fell 0.6 percent to 13.3879 per dollar as of 10:35 a.m. in Mexico City, the lowest level since July 26 on a closing basis.

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