US imports more from Mexico than China

For the first time in two decades, America imported more goods from Mexico than China in 2023, signaling a significant shift in global trade patterns as tensions between Washington and Beijing continue.

The value of goods exported to the US from neighboring Mexico rose nearly 5% from 2022 to 2023, reaching over $475 billion. Meanwhile, imports from China decreased by 20% to $427 billion, according to Commerce Department data.

Mexican President Andres Manuel Lopez Obrador is hoping to leverage the surge in US imports from his nation in border negotiations.

Not just Mexico, imports from Europe, South Korea, India, Canada and Vietnam have increased in the past year—mainly in auto parts, shoes, toys and raw materials.

Shift due to rift
Trade clashes with China increased in 2018 when former President Donald Trump started imposing tariffs on Chinese products.

President Joe Biden maintained the tariffs as military (spy balloon), geopolitical (China’s support for Russia), and technology-related (AI microchips) tensions with China’s President Xi Jinping escalated.

The Biden administration has since then encouraged companies to seek suppliers in allied countries or return manufacturing to the US, which has helped Mexico.

Understanding the shift
In 2023, foreign investment in Mexico went up 21%. But China still manufactures some components and supplies them to other countries that export to the US. Beijing has also increased its investment in Mexican manufacturing facilities over the past few years.

However, skepticism toward China is strengthening trade ties between the US and its allies.