Japan seeks to increase investments in Mexico’s automotive industry, pending NAFTA negotiations

Japan seeks to increase investments in Mexico’s automotive industry, pending NAFTA negotiations

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Tarō Kōno, Minister of Foreign Affairs of Japan, informed Mexico’s President-elect Andres Manuel Lopez Obrador that investments by Japanese automotive and auto parts companies in Mexico will increase once there is more certainty about how the North American Free Trade Agreement (NAFTA) will change, said Marcelo Ebrard, future Secretary of Foreign Affairs (SRE).

“The Minister of Foreign Affairs mentioned that the automotive and auto parts industry, which is very powerful, is ready to increase its investments in Mexico, once the NAFTA negotiations are over,” said Ebrard.

When asked if there was concern for the interests of Japanese companies established in Mexico in response to the results of the free trade agreement, Ebrard said that the Japanese wished Mexico luck in the renegotiations of the trilateral agreement.

“They understand that the negotiation process may take weeks, but that they are willing to increase their investments, that is, the percentage of auto parts and components of the Japanese automotive industry that are made in Mexico would increase even more in the next five years,” said Ebrard.

With this, Kōno is seeking to strengthen the relationship between Mexico and Japan as well as seeking new ways for the 2005 trade agreement to be expanded. Ebrard explained that the main interest of the government and companies in that country is focused on increasing trade and increasing their participation in the automotive industry.

Some Japanese companies have already expressed their interest in Mexico’s automotive industry. For example, the Japanese firm Uchiyama Group, a manufacturing corporation that manufactures a wide variety of polystyrene products, such as “PLASFOAM”, for the automotive sector has announced its plans to establish a plant in the state of Yucatan––being the first of this company in the country. This represents a US$50 million investment, and is projected to initially generate 200 new jobs, which could grow up to 1,000 in a five-year period.

Ebrard also announced that Lopez Obrador’s administration will seek to strengthen the bilateral relationship with Japan, and that in October he will travel to Tokyo along with Alfonso Durazo, who is proposed to head the Ministry of Public Security.

“This cooperation has been going on for many years, but we want to deepen it. For this reason, the president-elect asked me to plan a visit to Japan in October with the next Secretary of Security, Alfonso Durazo, who will also be responsible for the Civil Protection tasks in the next administration,” said Ebrard.

Furthermore, Ebrard said that in the meeting with Japan’s Minister of Foreign Affairs, the issue of reforming the Security Council in the United Nations was discussed and that Japan sees that Mexico should join the organization permanently.

“There was also talk that Japan looks with great eyes to strengthen the United Nations (UN), which proposed that the UN Security Council should be reformed to better reflect the reality of the world and in that reality, they think, Mexico should already be invited to the UN Security Council for the relative weight that Mexico has, not only by population, but also in economy, culture and international relations,” said Ebrard. 

He also added that both countries are willing to collaborate on technology issues as long as Mexico presents an agenda on this issue.