Mexico has overtaken China as America's largest trading partner due to tensions and operational challenges in China. Reshoring and nearshoring to Mexico offer companies benefits such as lower labor costs and quicker shipping times. Investing in Mexico can be pursued through its growing companies or U.S. firms that will benefit from this shift in trade dynamics.

1. By: www.ProfitableInvestingTips.com

2. What country is America’s biggest trading partner? If
your answer is China you are wrong. Mexico has passed
China as the biggest trading partner of the USA.
Tensions with China have caused American companies
to back off from years of offshoring to Communist
China.

3. Reshoring and investments in America are the focus
of many companies. Others are opting for nearshoring
with Mexico as the prime beneficiary. Made in
Mexico is replacing Made in China for everything
from electronic vehicles to baked goods. The issue for
us is how to invest in Mexico.

4. Why Is Everyone Leaving China?

5. The attraction of China for offshoring was cheap labor
and potentially access to a huge market. For this,
companies and investors were willing to put up with
intellectual property theft, questionable financial
statements, heavy-handed Communist Party control
of whole industries and a supply chain that began on
the other side of the Pacific Ocean.

6. What has happened is that foreign companies are
finding it harder and harder to operate in China. Folks
like Apple are seeing their products banned in
government offices. And there is the very real
possibility of military conflict with Taiwan that would
involve US forces.

8. What Does Mexico Have to Offer?

9. Like Canada, Mexico is right next door to the USA.
Canada, Mexico, and the US have the NAFTA trade
agreement which reduces duties and makes trade
easier. Shipping goods from Mexico to the USA is
significantly cheaper and faster than shipping from
China. Executives can often visit their Mexican
operations and return home on the same day.

10. Mexico has a substantial labor pool available at much
lower wages than in China. It has 130 million people as
opposed to Canada’s 38 million. More than 88 million
Mexicans are or working age Not only does Mexico
have a large labor pool, its wage scale is substantially
lower than in the USA (or in China) with the workers
on average making $281 a month. By comparison UAW
workers make on average $3212 a month and mainland
China workers average $4012 a month!

11. The Mexican military does not control whole sectors of
the economy like in China where the Communist Party
and Red Army call the shots. These are good reasons
for a company to consider near shoring to Mexico. Now
the question is how can you invest in Mexico?

12. Follow the Smart Money to Mexico

13. A useful tactic when deciding where and how to invest is
to follow the smart money. Foreign direct investment
in Mexico has gone up 40% in 2023 according to
Bloomberg in their article about how Mexico
replaced China as our top trade partner this year.
Mexico’s stock market is doing well. Two ways to invest
in Mexico are to invest in Mexican companies that are
growing and to invest in US companies that will
benefit from near shoring to Mexico.

14. Mexican ADRs

15. One does not need to speak Spanish, deal with a Spanish
speaking broker, or buy stocks on the Mexican stock
exchange (Bolsa de Valores Mexico). Mexican
companies have American Depositary Receipts on the
New York Stock Exchange. America Movil SAB de CV
is the biggest wireless carrier in Latin America.

16. Its stock is up about 60% in the last two years. Cemex
CEMEX S.A.B. de C.V is a multinational building
materials (concrete) company that is up about 60%
since last year. Bimbo is a multinational food company
whose stock had doubled in the last two years.

17. For more insights and useful information about
investments and investing, visit
www.ProfitableInvestingTips.com.