The paper seeks to understand the implications of China’s entry into the WTO for Mexico and the bilateral relationship between the People’s Republic of China and Mexico from the perspective of their respective economic and export strategies since the 1980s. As discussed in detail in the paper, China’s entry into the WTO is not only significant for Mexico, but also for the rest of the periphery in terms of bilateral trade, but also in third markets. Trade data and some theoretical and economic trade issues are provided for understanding the richness and potential of this relationship, as well as its challenges.

China’s entry into the WTO will affect the world market as such, i.e. China is not “another” country participating in the world market, but rather the biggest country in terms of population, currently the main destination of FDI, and the country with the world-wide highest dynamics in terms of growth and trade, as well as of foreign reserves. Thus, China’s integration into the world market after its entry into the WTO will result in new patterns of the world market affecting core and periphery. 

In addition, the document analyzes China’s entry into the WTO in more general terms of development and growth and development theory. In terms of energy consumption and CO2-emmission, for example, the prospect of continuous growth of GDP in China –as well as in Latin America in general and Mexico specifically- is not sustainable from an energy and ecological perspective. China and Mexico are direct competitors in the world market and as a result of their recent productive and trade specialization. It could be argued, however, that their respective products, processes and imports and export markets are different. This is the reason why a detailed analysis of China’s and Mexico’s integration into the world market is pursued in the document. 

Based on this detailed bilateral relationship, in the US-market, as well as for a specific sector (the yarn-textile-garment value-added chain), the paper elaborates on different scenarios for Mexico resulting from China’s entry into the WTO and specific policy recommendations to deepen and enhance the bilateral relationship.

The economic and trade relationship between both countries also challenges the notion that export-oriented industrialization and integration into the world market through exports is a generalized option for nations in periphery. The repercussions of these findings – particularly regarding energy-intensive growth and that countries such as China and Mexico might close the gap in terms of GDP and the required energy for doing so- with respect to sharing global costs and allowing for growth in developing countries will have to be analyzed in depth and possible solutions proposed in the near future.

The whole text can be downloaded here.