China

inaChina and Mexico: The current trade dispute and its effect on the trade deficit with China.
The trade imbalance between China and Mexico responds to structural issues arising from intra-firm trade between large companies, but the great dynamics of China's economy provides opportunities for Mexican companies to join the Asian giant chains providing inputs, intermediate goods and consumer goodsend. Apart from the trade imbalance between China and Mexico, trade has grown significantly in the recent years. China has become the second largest trading partner of Mexico worldwide. With its trade, both countries have been benefitted; however, China has been gaining more by utilizing Mexico as a platform for the American market. Mexico’s exports to China have been slowly increasing comparedto its imports from China which has made one of the biggest trade deficits in Mexico’s international relations. Throughout the research, it will be seen how both countries have made efforts to bring or avoid the trade deficit that has come to pass in the last few years of their commercial exchanges.
China and Mexico Trade Facts
Economic exchanges between Mexico and China have grown rapidly since1990. China is now Mexico’s second largest trading partner after the United States. In 2006, China was the target of 0.7% of Mexican exports, but their second largest source of imports with 9.5% of the total. In overall, in 2006 trade with China accounted for 5.2% of the total. The trade deficit with China that Mexico has is explained by the exchange of intermediate goods and inputs of theelectronics, electrical and computer appliances, which together in 2006 accounted for 73% of Mexican imports (Embamex China). The final consumer goods, despite the psychological impact they have on the population and Mexican businessmen for their ubiquity in the shops, have a high share in total trade. China and Mexico trade data has shown that there is big trade deficit due to the fact that MexicanChinese exports have grown and increased rapidly while Mexican Chinese imports have had a very small change. This trade negotiation presents great opportunities for companies from both countries, but also reflects the influence of third parties in bilateral trade. It also obvious to see that China is being attracted by the Mexican market due to its proximity with the United States. It has made iteasier for Chinese products to be completely manufactured in Mexico and re-exported to the United States.
According to Mexican statistics, 93% of bilateral trade is from Mexican imports of Chinese products. The most important part of trade is composed of parts and appliances of electronics, electrical, and computers. The highest proportions correspond to parts and supplies that are imported fromChina and then be incorporated into finished products in Mexico and be re-exported to third countries, mainly the United States.
Major Industries
Food and beverages.
Unlike other sectors, food and beverage industry in China has a modest size (only contributes 2.9% of exports) and has a below average growth in terms of foreign sales (4.8% last year). China specializes in processed products, buthas a significant level of exports of vegetables and marine products (Promexico 2010).
Electronics and appliances.
Mexico and China are powers in the production of end consumer electronics, although the latter has a broader base of products in this range (TVs, cell phones and cables provide more than half of electronic exports in Mexico). In this sense, there is ample room for greaterparticipation of Chinese manufacturers in Mexico. The country manufacturers have their own in factories such as Hisense, Sichuan Changhong, Konka Shenzhen and Xiamen Overseas specialized in low value-added appliances models. It is expected that these manufacturers will rise in the value chain. This can lead them to set up plants in Mexico, where in 2006 44% of television were made ​​recent technology...