MEXICO CITY (Reuters) – Mexico has spoken to a host of foreign companies, particularly steelmakers, in an effort to lure business from Asia to capitalize on a new North American trade deal, Economy Minister Graciela Marquez said on Monday.

The U.S.-Mexico-Canada trade agreement (USMCA) took effect at the beginning of this month and replaced its quarter-century-old predecessor as the coronavirus pandemic wallops the global economy and international trade. The new deal includes tougher content rules both for autos and steel and aluminum than when the North American Free Trade Agreement was launched in 1994.

“In steel we see the biggest opportunity,” Marquez, a Harvard-trained economist, told Reuters in an interview. “We want to show these companies the opportunities that open up with this increase in regional content requirements.”

Marquez said the government of President Andres Manuel Lopez Obrador has held talks with foreign steelmakers, including South Korea’s POSCO (005490.KS), Japan’s Nippon Steel Corp (5401.T) and Mitsubishi Corp (8508.T) and Ternium (TX.N), about investing in Mexico to produce steel for the auto sector.

She said there is a possibility foreign steelmakers could partner with or take a stake in Mexico’s Altos Hornos de Mexico (AHMSA.MX). None of the steelmakers immediately responded to a request for comment.

Considering Mexico’s diverse manufacturing base, Marquez said the government was interested in attracting a range of companies from across the globe.

She said the government also would seek to speak with Apple (AAPL.O) and other U.S. firms about relocating their supply chain to Mexico.

Retelling a recent conversation with Lopez Obrador, Marquez said she pointed to the cellphone she was holding in her hand and said “these phones don’t have to be produced in China … there is an enormous opportunity to produce them” in Mexico.

The government is looking to attract North American and European firms producing in China, Singapore and Vietnam.

Marquez said the new trade deal came into force at a “critical” juncture for both the Mexican and the global economy and that it could help Latin America’s second-largest country recover from the fallout of the coronavirus pandemic.

Reporting by Stefanie Eschenbacher and Anthony Esposito; Editing by Tom Brown and Dan Grebler

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Ferrari trims full-year outlook after second-quarter earnings skid

MILAN (Reuters) – Luxury carmaker Ferrari (RACE.MI) trimmed its full-year earnings forecast on Monday after second-quarter income plunged due to supply chain and production disruptions due to the coronavirus pandemic. The company known as the ‘Prancing Horse’ said production suspensions…

New reforms needed to implement ‘dual circulation’ strategy: experts

BEIJING — China needs further reforms to boost the quality and efficiency of domestic circulation as it moves to establish a new development pattern featuring “dual circulation,” experts said. A new pattern of development must be forged on the basis…

U.S. stocks slide as renewed tariff threat compounds pandemic fears

NEW YORK (Reuters) – Wall Street stocks dropped sharply on Friday as investor risk appetite was soured by the revived specter of tariffs against China, threatened anew by U.S. President Donald Trump in retaliation for the COVID-19 pandemic which has…

Futures slump on alarm over fast-spreading virus

(Reuters) – U.S. stock index futures dropped more than 1% on Thursday as investors stayed away from making riskier bets after the rapid spread of the coronavirus outside China deepened worries about growth and corporate earnings. The number of new…