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Mexican Manufacturing Faces Challenges

November 15, 2005

MEXICO: The ProLogis Research Group conducted a study, “Is China’s economic success a threat to Mexico?,” to examine whether China’s recent success in exporting to the U.S. threatens Mexico’s market share.
The study indicated that although some observers believe China’s exports to the U.S. are growing at the expense of Mexico’s, there is no causal connection, and that reports of the demise of Mexican manufacturing have been exaggerated. According to the study, the slowdown of Mexico’s exports to the U.S. is due to the U.S. economic boom that peaked in 1999-2000 and the prolonged U.S. recession and slow recovery. The strong U.S. economy of the late 1990s fueled the growth of Mexican maquiladora facilities, but they have been hard hit since by the U.S. economy’s sluggishness, according to ProLogis executives. But despite their recent economic woes, Mexico’s manufacturers have made progress in moving up the value-added ladder.
More info: www.ir.prologis.com, on the “Proprietary Research” page.
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