Mexico’s exports to the United States have reached 475,000 million dollars in 2023, which represents 87% of its total external sales, which are approx 550,000 million dollars annual. This means that Mexico exports more than double that of the rest of the Latin American countries combined.
In global terms, Mexico now exports more to the United States than the People’s Republic of China, which last year sold goods to the North American market for 427,000 million dollars.
Strictly speaking, Mexico hardly “exports” to the United States 500,000 million dollars per year, but constitutes a growing and increasingly significant part of the accumulation process of the United States, the world’s leading economy (US$25.6 billion/25% of global GDP).
These extraordinary achievements are the direct result of the “North American Free Trade Agreement” (NAFTA), signed in 1992 by the United States, Mexico and Canada; and expanded and deepened by the New NAFTA (“USMCA Agreement”) signed on August 18, 2020 at the urging of then-President Donald Trump.
The key features of the New NAFTA are as follows: Above all, it is an exceptional process of productive integration supported by investments rather than trade; and represents the most advanced phase of the global integration of capitalism (or globalization) which is the sign of the times, and which is driven by a dizzying digitalization that has become synonymous with instantaneousness.
Bilateral trade between Mexico and the United States amounted to 782,000 million dollars in 2022, and would rise to more than 1 billion dollars at the end of 2024. It should be added that if trade with Canada were added, New NAFTA domestic trade would reach 1.7 billion dollars.
Strictly speaking, the New NAFTA reveals the true identity of American capitalism in the 21st century, as the protagonist of the fourth industrial revolution, and which is increasingly integrated across national borders.
Today the United States is a political system and a specific territory, with a population of 330 million inhabitants (5% of the world total); and at the same time it is a permanently restructured economic space, whose historical/structural core is made up of approximately 400 innovation, financing and higher education centers distributed throughout the United States, and increasingly in Mexico and Canada.
The New NAFTA introduced a decisive clause in the history of international capitalism, which establishes this Multinational automotive companies based in Mexico may preferentially export to the North American market to the extent that its workers’ wages reach American levels.
The New NAFTA (“USMCA Agreement”) also increased the national content of automotive companies established in Mexico to 75% (13 points more than what was agreed in 1992/1994), which has become an extraordinary magnet for attracting investments in the world ; The result has been that in the last 10 years, transnational investments in Mexico have exceeded the limits 300,000 million dollars, which indicates a real passion to invest and produce and then sell in the largest market in the world, which is North America.
This is a crucial point: The current “free trade agreements” are guided by a criterion where the essential is investments and the accessory is the exchange of goods and services. There is a relationship of priority and continuity between these 2 categories: investments attract and drive trade, because they allow us to produce and then export, in a phenomenon in which transnational companies play an absolutely fundamental role.
The entire system dictates its pace based on the speed of the digitalization process, which through Artificial Intelligence (AI) has become synonymous with instantaneousness. The race between time and space that is at the origin of industrial capitalism was definitively resolved with the triumph of time over its historical rival, space.
Provisional conclusion: in a world absolutely integrated by the technological revolution, the North American space of the New NAFTA competes – and integrates – only with the other great axis of the world system, which is South-East Asia with its epicenter in China, and whose core is fundamental is the Shenzhen, Beijing and Shanghai tripod.
This historical provision has a double effect: on the one hand, the comparative advantage that Mexico had due to its low wages in the old NAFTA of 1992/1994 disappears; and at the same time a country that is absolutely underdeveloped in many aspects and regions tends to share the same economic and technological standards as the world’s leading economy.
The consequence is that the relationship between the two countries acquires an absolutely “horizontalizing” character, which absorbs and dominates the old and now anachronistic category of “dependence” typical of an era definitively left behind.
This integration, like any capitalist development, has an unequal and combined character that forces us to distinguish in each case what is essential and what is accessory, due to the inseparable nature of historical processes.
Source: Clarin
