The Mexican peso has managed to hold its value while its peers succumbed to the dollar's relentless upward momentum. Some of the strength comes from relatively typical stimuli: tight fiscal policy and interest rate increases that have fueled the carry trade.

Another factor, this time external, is the expectation of a radical change in world trade in the coming years that could generate an increase in Foreign Direct Investment in Mexico.

Now Mexico is attracting factories from China as higher wages and rising transportation costs undermine what had been its competitive advantages. Covid has created an aversion to remote supply chains, prompting companies to move operations in Asia to locations closer to the United States, the world's largest market, known as nearshoring.

Check here: Airport infrastructure drives Tijuana growth

Now, Mexico's exports to the US are narrowing the gap with China and there is turmoil in the foreign exchange market, surprising investors who at the end of last year predicted that the peso would be one of the world's losers.

According to statements by Hari Hariharan, executive director of the New York-based hedge fund NWI Management, "this is going to be a decade of Mexico's rise at the expense of China."

The boom is felt throughout northern Mexico, now the country's industrial heartland, where bulldozers and excavators can be seen from Tijuana to Matamoros. At least six suppliers to Tesla Inc., including Taiwan's En Flex Corp. and Quanta Computer, France's Faurecia, Germany's Friedrichshafen AG and APG Mexico, have established operations in Nuevo León since 2021.

Of interest: Construction begins on the new Pegatron industrial plant in Cd. Juárez

Vacancy rates at industrial parks in Ciudad Juárez, Reynosa and Monterrey hit record lows in the first quarter of 2022 due to nearshoring demand, Credit Suisse analysts said in their June report.

In June 2022, the Inter-American Development Bank estimated that nearshoring could add up to an additional US$35.3 billion for one year in annual exports from Mexico.

In Solili you can consult industrial warehouses available in Tijuana, Mexicali and Tecate

Original note