Composition and Path of Asian Direct Investment in Mexico: Scope and Limitations of the Nearshoring Process

This paper analyses the patterns of FDI from Asian countries into Mexico trying to understand if the patterns in the last years can show the development of the relocating production facilities from China to North America to leverage lower labor costs and proximity to the U.S. market known as nearshoring. Through a review of existing literature on U.S.-China economic decoupling and its implications for nearshoring, we provide a comprehensive background on Asian investments in Mexico, emphasizing the critical role of the manufacturing sector, especially in automotive industries led by Japanese firms. By analyzing official data from the Mexican government, we compare Asian FDI trends with those from other regions, ultimately offering insights into the strategic choices of Asian companies in response to shifting global economic dynamics. This study aims to enhance understanding of the evolving investment landscape in Mexico and its implications for international trade relations.