Vietnam emerges as Mexico’s potential trade partner

Pham Thuy Linh, Deputy Global CEO of VinFast (sitting on the left) and the Representative of Durango Drivers' Union at the MoU signing ceremony. (Photo: VNA)

Mexico City - Amid Mexico’s increasing import taxes on countries without a Free Trade Agreement (FTA), Vietnam is gaining recognition as a promising trade partner for this Latin American nation.

In an interview with a Vietnam News Agency (VNA) correspondent in Mexico, Vietnamese Trade Counselor Luu Van Khang highlighted that in 2024, many leading Mexican importers and distributors have turned to Vietnam for goods supplies, especially apparel, footwear, plastics, and furniture - the country's strengths.

Both Vietnam and Mexico are members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which offers preferential import-export tariffs. According to Khang, Vietnamese businesses should leverage this new-generation FTA to enhance their presence in Mexico’s 130-million-strong market. Under the CPTPP, Mexico has pledged to eliminate tariffs on 77% of its import lines, accounting for 36.5% of its import value from Vietnam, and will increase this figure to 98% by the 10th year of the agreement.

This preferential framework has driven impressive growth in Vietnamese exports, including seafood, coffee, rubber, mobile phones, components, and automobile parts. At the same time, Mexico has gradually boosted the shipment of beef, pork, agricultural products, and beverages to Vietnam, demonstrating the complementary nature of trade between the two nations.

According to Khang, in addition to the CPTPP benefits, Vietnamese products have gained a price advantage in Mexico. Over the past year, the Mexican government has increased import taxes on over 500 product categories from countries without an FTA, with tariffs as high as 50%.

He noted that efforts by businesses and relevant agencies in both countries, coupled with the shift of Mexican importers toward Vietnam as an alternative market, have propelled bilateral trade to 5.9 billion USD between January and November. This figure is projected to reach 6.4 billion USD by the end of the year, marking a 23% increase compared to 2023.

The year 2024 has also witnessed notable collaborations between Vietnamese businesses and Mexican partners. Among these is the signing of a Memorandum of Understanding (MoU) between electric vehicle maker VinFast and the Durango Drivers' Union to promote green transportation. This includes a potential purchase of 3,000 VF 5 electric cars and 300 electric buses by the union.

Additionally, Vietnam’s Formula Air successfully completed an industrial ventilation system installation for Volkswagen’s automotive production facility in Puebla state. Meanwhile, Vietnam's tech giant FPT Corporation expanded its presence in Latin America, growing its network to 1,000 collaborators.

Looking ahead to 2025, Khang emphasised the significant potential for expanding bilateral trade between Vietnam and Mexico. Both countries, with their large populations and substantial purchasing power, share similar market characteristics and offer opportunities for mutually beneficial trade across various sectors.

However, he advised Vietnamese businesses operating in Mexico to enhance their product documentation, particularly certificates of origin and production processes, as the Mexican government tightens legal regulations to protect domestic industries and comply with the US-Mexico-Canada Agreement (USMCA)./.