Mexico – From a short nearshoring boom to US "security-shoring"

With the reconfiguration of international supply chains, Mexico has gained importance as a location for new foreign investments. The country has been able to benefit from nearshoring, that is, the relocation of services or production processes closer to consumer markets. This is associated with lower logistics costs and often better management of supplier relationships. However, this boom in investments has abated due to various uncertainties - not least being Washington's threats to raise tariffs, which burdens the economic prospects associated with nearshoring. Mexican President Claudia Sheinbaum is attempting to counter this trend, but in view of the increasingly urgent demand by the United States for third countries to adopt an anti-Chinese course, Mexico is at risk of being caught in the trap of "security-shoring" and losing its autonomous room for manoeuvre. This is already forcing Mexico - as well as its economic partners who have invested there - to realign their production processes.