This article, which examines Mexico’s approach to Ukraine and China, is part of an ongoing series on U.S. statecraft and the Global South developed by the Carnegie Endowment’s American Statecraft Program. For other articles in the series, click here.
Under President Andrés Manuel López Obrador, Mexico has taken positions counter to Washington’s preferences on Ukraine, where domestic politics have encouraged López Obrador to mark distance from Washington. By criticizing the U.S. approach to Ukraine, López Obrador has played to deep domestic skepticism about America. He has also telegraphed that Mexico marches to its own beat and identifies with the Global South, not always with Washington—despite its close economic relationship. In contrast, Mexico shares common ground with the United States on China and stands to benefit from the relocation of manufacturing from Asia to North America brought on by U.S. efforts to de-risk from Chinese supply chains.1 The likely victory of Claudia Sheinbaum, who comes from the ruling MORENA party, in the June 2 presidential election suggests continuity in Mexican foreign policy even after López Obrador’s tenure.
Mexico’s Approach to the War in Ukraine
Mexico firmly rejects Russia’s invasion of Ukraine and sympathizes with Ukraine’s struggle.2 It has supported all Ukraine-related UN resolutions to date, except the resolution to suspend Russia’s membership in the Human Rights Committee, on which it abstained. Defending the abstention, López Obrador, like other Latin American leaders, argued that the war cannot be resolved without mediation, which requires Russia's presence in international bodies.3
But Mexico still does not want to get involved, and López Obrador said at the outset that it would not “participate, neither for nor against” and that a neutral position was the most “convenient.”4 It refused to impose sanctions on Moscow and said it will not send weapons to Ukraine, on the grounds that Mexico is a pacifist country.5
López Obrador has also criticized the United States in the process. For example, he has claimed that sanctions and arms shipments to Ukraine “have only served to aggravate the conflict”6 and opined that NATO’s strategy of sending weapons to Ukraine was “immoral.”7 Mexico’s former foreign minister Marcelo Ebrard warned that sending weapons “to prolong a conflict” is costly and pushed instead for a political solution to the war.8 In September 2022, Mexico put forward its own peace plan.9
Unlike some other emerging powers, Mexico’s opposition to U.S. policy on Ukraine cannot be explained by economic interests, given its limited economic ties with Russia. When defending their stance, Mexican officials often cite the Estrada Doctrine, a tradition of nonintervention dating back to 1930 that was revived by the López Obrador administration. But Mexico frequently uses the Estrada Doctrine to justify its neutral stances, even when other interests are driving its approach.10
On the domestic front, López Obrador’s position is probably also shaped by a faction in his party that harbors pro-Russian sentiment and would disapprove if López Obrador went too far against Moscow.11 As a creature of domestic politics, he is also more than willing to use criticism of U.S. policy in Ukraine to play to anti-American public sentiment. Surveys show that a majority of Mexicans hold favorable opinions of the United States, but Mexican elites—who are important to López Obrador’s coalition—tend to be deeply skeptical of American motives and values.12 U.S. congressmembers’ too often hostile rhetoric on Mexico also fuels a negative image of the United States among Mexican elites, which incentivizes López Obrador to stand up to Washington, at least rhetorically.
Regional ambitions also play a role, albeit to a lesser degree. López Obrador probably hopes his Ukraine stance can signal Mexico’s allegiance to the Global South. Mexico is keen to regain a position of leadership among Latin American countries, which was questioned after it signed the North American Free Trade Agreement (NAFTA) in 1992 and began siding more closely with the United States than with some of its other neighbors such as Venezuela, Bolivia, Ecuador, and Nicaragua; Mexican leaders are sensitive about the region’s perception that Mexico’s closeness to the United States undercuts its independence and ability to advance Latin American interests. Mexico thus recently rejoined the G-77, a group formerly understood as the Non-Aligned Movement, which Mexico had exited in 1994 to join the predominantly Western Organisation for Economic Cooperation and Development (OECD).13
Ultimately, however, López Obrador is primarily driven by domestic concerns. He may proclaim a desire to lead in Latin America, but he fails to back these dreams up with sustained diplomacy. For instance, he rarely makes state visits or takes leadership in regional fora.14 He insists that “the best foreign policy is a good domestic policy,” and is far more concerned with how his foreign policy stances land at home than with how they are perceived abroad.15
Mexico’s Approach to China
In 2023, Tesla delayed a planned expansion of its factory in Shanghai and instead announced a new $15 billion plant in northern Mexico.16 Hundreds of other multinational companies, including Walmart, Amazon, Samsung, Nissan, and the Home Depot, are also shifting production from Asia to Mexico.17 As the United States pursues “de-risking” from China, companies are attracted to Mexico’s manufacturing-based economy, free trade agreements with the United States, Canada, Japan, the EU and several Latin American countries.18 Foreign direct investment into Mexico has skyrocketed in the past two years, with outflows of FDI from the United States almost tripling in 2022.19 In a sign that “nearshoring” is already underway, Mexican exports are now reaching record-high levels.20 In 2023, Mexico became the United States’ top trading partner. 21
Needless to say, López Obrador welcomes the influx of resources.22 This economic opportunity makes it unlikely that Mexico will seriously deepen its ties with Beijing. So does the fact that Mexico and the United States rely on each other to meet the shared challenges of migration and the trafficking of drugs and arms across the border. In short, a close friendship with China would be very costly for Mexico.
Compared to many of its Latin American neighbors, Mexico has thus not allowed China significant inroads. For example, it has not signed onto the Belt and Road Initiative, nor has it joined the Asian Infrastructure Investment Bank. Chinese investment in Mexico since 2018 sits at around $4.7 billion. In comparison, Chinese investment in Brazil and Argentina, the two other Latin American countries we examined, reached $15 billion and $10 billion in that same period, respectively. 23
Mexican officials claim, credibly, that this is because Mexico would prefer to work with the United States than China. But Mexico also faces structural obstacles to expand trade with China. These include a “poison pill” clause in the U.S.-Mexico-Canada-Agreement (the successor to the North American Free Trade Agreement) that precludes a free trade agreement with a “non-market country.”24
Moreover, because Mexico and China manufacture the same products, there is not much to be gained from more trade between the two countries. Mexico rightly sees China as a harsh economic competitor. In the early 2000s, Mexico was the last country to vote in favor of China’s accession to the WTO and was one of the most negatively impacted by China’s economic rise, or what is known as “the China shock.”25 As an advanced manufacturing economy, Mexico is not as well-suited for China’s investment as some of its neighbors, which are commodity exporters (most of China’s investments in the region have been in commodities).26
More recently, Mexico indicated it was open to more aggressive anti-China trade policies; in August 2023, it unilaterally imposed a tariff of 25 percent on several products, such as glass, steel, and aluminum, on countries with which it does not have a free trade agreement.27 This was aimed directly at China. The tariff led China’s commerce spokesperson to urge Mexico to “stick to the free-trade principle and remain cautious” with such measures.28
Broad alignment with Washington over China has not prevented López Obrador from occasionally using strategic competition to air his frustration at the United States. When U.S. lawmakers hassled Mexico to stop the flow of fentanyl into the United States, López Obrador wrote a letter to Chinese President Xi Jinping, where he complained about the “absurd, manipulative, propagandistic, and demagogic attitude” coming from Washington.29 Though this rhetoric sounds forceful, the likelihood of Mexico running into China’s embrace is low. In contrast to some other Latin American countries, such as Brazil, there is no significant pro-China domestic constituency within Mexico. Moreover, were Mexico to attempt to use a closer relationship with China to gain leverage over Washington, it would surely be met with a strong rebuke.
Mexico’s approach to the world may shift with the closing of the López Obrador era and the beginning of a new administration in 2024. To Senator Xóchitl Gálvez, the opposition frontrunner for the 2024 election, a strong bond with the United States is a top priority. When asked about U.S.-China competition, Gálvez said that although Mexico needs to have a dialogue with China, it is part of North America and thus needs to side with the United States. “I know where I am located and I do know with whom I want to have a commercial relationship,” she said.30 Indeed, Gálvez shares the view of many Mexicans who seek Mexico’s full integration into North America and dream of being seen as a “North American” nation. The de-risking movement may help make that more of a reality.
Notes
1 “Nearshoring Can Add Annual $78 Billion in Exports From Latin America and the Caribbean,” Inter-American Development Bank, June 7, 2022, https://www.iadb.org/en/news/nearshoring-can-add-annual-78-bln-exports-latin-america-and-caribbean.
2 "Mexico Says it Does Not Accept Russian Invasion of Ukraine," Reuters, April 9, 2022, https://www.reuters.com/world/europe/mexico-says-it-does-not-accept-russian-invasion-ukraine-2022-04-09/.
3 "Mexico Abstains in UN Vote Expelling Russia from Human Rights Council," Mexico News Daily, April 8, 2022, https://mexiconewsdaily.com/news/mexico-abstains-russia-human-rights-council/#:~:text=Mexico%20on%20Thursday%20abstained%20in,an%20international%20human%20rights%20organization.
4 Ezequiel Flores Contreras, "Mexico Will Remain Neutral in the Russia-Ukraine Conflict: López Obrador," Proceso, March 23, 2022, https://www.proceso.com.mx/nacional/politica/2022/3/23/mexico-se-mantendra-neutral-en-el-conflicto-rusia-ucrania-lopez-obrador-283018.html.
5 "Mexico Will Not Send Arms to Ukraine, President Says," Reuters, March 4, 2022, https://www.reuters.com/markets/rates-bonds/mexico-will-not-send-arms-ukraine-president-says-2022-03-04/.
6 "Discurso del President Andrés Manuel López Obrador Durante el Desfile Cívico Militar: 212 Aniversario de la Independencia," Lopez Obrador, September 16, 2022, https://lopezobrador.org.mx/2022/09/16/discurso-del-presidente-andres-manuel-lopez-obrador-durante-el-desfile-civico-militar-212-aniversario-de-la-independencia/.
7 "Mexican President Slams NATO Policy as 'Immoral,'" AP News, June 13, 2022, https://apnews.com/article/russia-ukraine-mexico-caribbean-nato-b9aaddc8e3da3ad2b2cc013a6e8ff4bb.
8 Michael Stott et al, "’We Are For Peace’: Latin America Rejects Pleas to Send Weapons to Ukraine," Financial Times, https://www.ft.com/content/fc8d51c8-5202-4862-a653-87d1603deded.
9 Ambassador H.E. Juan Ramón de la Fuente and Pablo Arrocha Olabuenaga, "Mexico's Initiative for Dialogue and Peace in Ukraine," Just Security, September 23, 2022, https://www.justsecurity.org/83205/mexicos-initiative-for-dialogue-and-peace-in-ukraine/.
10 Genaro Lozano, “How to Understand Mexico’s Lonely Stance on Venezuela,” Americas Quarterly, February 13, 2019, https://www.americasquarterly.org/article/how-to-understand-mexicos-lonely-stance-on-venezuela/.
11 Mark Stevenson, “Mexico’s Ruling Party Boosts Russia ‘Friendship’ Committee,” AP News, March 23, 2022, https://apnews.com/article/russia-ukraine-lifestyle-mexico-europe-friendships-6e59bf618d045f937fb0bf5412afc734.
12 Jacob Poushter and Jordan Lippert, “6 Facts About How Mexicans View the U.S. and Their Own Country,” Pew Research Center, September 8, 2023, https://www.pewresearch.org/short-reads/2023/09/08/6-facts-about-how-mexicans-view-the-us-and-their-own-country/; “Poll: Mexican Views of the U.S. Rebound From All-Time Low,” Chicago Council on Global Affairs, March 6, 2019; Gerardo Maldonado et al, “Mexicans Facing the Challenges of the World: Public Opinion, Leaders and Foreign Policy,” Center for Economic Research and Teaching (CIDE), 2018, https://centrogilbertobosques.senado.gob.mx/docs/Mexico_Americas_Mundo.pdf.
13 Juan Martinez, “Mexico Rejoins G77+China at Havana Summit,” Rio Times, September 16, 2023, https://www.riotimesonline.com/mexico-rejoins-g77china-at-havana-summit/.
14 Olga Pellicer, “Why Mexico is a Quiet Presence on the World Stage,” Americas Quarterly, April 25, 2023, https://www.americasquarterly.org/article/why-mexico-is-a-quiet-presence-on-the-world-stage/.
15 ibid.
16 "Tesla Delays Plans to Expand Shanghai Factory," Reuters, January 12, 2023, https://www.reuters.com/business/autos-transportation/tesla-delays-plans-expand-shanghai-factory-bloomberg-news-2023-01-12/; “Tesla, Suppliers to Invest $15 Billion in Mexico Factory, Local Governor Says,” Reuters, September 11, 2023, https://www.reuters.com/business/autos-transportation/tesla-suppliers-invest-15-bln-mexico-factory-local-governor-2023-09-12/.
17 Peter S. Goodman, “‘OK, Mexico, Save Me’: After China, This Is Where Globalization May Lead,” New York Times, January 1, 2023, https://www.nytimes.com/2023/01/01/business/mexico-china-us-trade.html#:~:text=Early%20last%20year%2C%20when%20Walmart,run%20apparel%20business%20in%20Mexico.&text=It%20was%20February%202022%2C%20and,trade%20seemed%20up%20for%20alteration.
18 Anthony Harrup and Juan Montes, "Mexico's Industrial Hubs Grow as Part of Trade Shift Toward Nearshoring," Wall Street Journal, February 1, 2023, https://www.wsj.com/articles/mexicos-industrial-hubs-grow-as-part-of-trade-shift-toward-nearshoring-11675257070.
19 United Nations Conference on Trade and Development, World Investment Report 2022, https://unctad.org/system/files/official-document/wir2022_en.pdf, 20; Maya Averbuch, “Mexico’s Foreign Investment Surges 48% as Nearshoring Booms,” Bloomberg, May 22, 2023, https://www.bloomberg.com/news/articles/2023-05-22/mexico-s-foreign-investment-surges-48-as-nearshoring-booms?sref=QmOxnLFz.
20 Leda Alvim, “Mexico’s Booming Exports Provide More Evidence of Nearshoring,” Bloomberg, June 27, 2023, https://www.bloomberg.com/news/articles/2023-06-27/mexico-s-booming-exports-provide-more-evidence-of-nearshoring?sref=QmOxnLFz.
21 Cork Gaines, "Mexico Replaced China as America's Top Trade Buddy," Business Insider, July 12, 2023, https://www.businessinsider.com/us-mexico-china-trade-world-economy-changing-2023-7.
22 Dave Graham and Daina Beth Solomon, "Tesla Plant Gets Green Light in Northern Mexico," Reuters, February 28, 2023, https://www.reuters.com/business/autos-transportation/mexican-president-says-tesla-will-build-major-plant-northern-city-2023-02-.
23 China Global Investment Tracker, American Enterprise Institute, https://www.aei.org/china-global-investment-tracker/.
24 David Lawder and Karen Freifeld, “Exclusive: U.S. Commerce’s Ross Eyes Anti-China ‘Poison Pill’ For New Trade Deals,” Reuters, October 5, 2018, https://www.reuters.com/article/us-usa-trade-ross-exclusive/exclusive-u-s-commerces-ross-eyes-anti-china-poison-pill-for-new-trade-deals-idUSKCN1MF2HJ.
25 Chris Kraul, “Mexico, China Still Far Apart in WTO Talks,” Los Angeles Times, August 14, 2001, https://www.latimes.com/archives/la-xpm-2001-aug-14-fi-33831-story.html; David Autor, David Dorn, and Gordon Hanson, “On the Persistence of the China Shock,” Brookings Papers on Economic Activity (Fall 2021): 381-447, https://www.jstor.org/stable/27133182/.
26 Felipe Freitas da Rocha and Richardo Bielschowsky, “China’s Quest for Natural Resources in Latin America,” Economic Commission for Latin America and the Caribbean Review, no. 126 (December 2018), https://repositorio.cepal.org/server/api/core/bitstreams/c6172ff4-2c3c-4472-8ffc-42d96e065572/content.
27 Kinling Lo, “As Mexico Shifts Trade Posts and Raises Tariffs, China Urged to Alter its Own Approach to Maintain Gains,” South China Morning Post, September 21, 2023, https://www.scmp.com/economy/china-economy/article/3235268/mexico-shifts-trade-posts-and-raises-tariffs-china-urged-alter-its-own-approach-maintain-gains.
28 Kinling Lo, “As Mexico Shifts Trade Posts and Raises Tariffs, China Urged to Alter its Own Approach to Maintain Gains,” South China Morning Post, September 21, 2023, https://www.scmp.com/economy/china-economy/article/3235268/mexico-shifts-trade-posts-and-raises-tariffs-china-urged-alter-its-own-approach-maintain-gains.
29 "Mexico Complains to China about U.S. Pressure Over Fentanyl," Los Angeles Times, April 4, 2023, https://www.latimes.com/world-nation/story/2023-04-04/mexico-complains-to-china-about-us-pressure-over-fentanyl.
30 Juan Pablo Spinetto, “Mexico’s Xochitl Galvez on Nearshoring, Insecurity, Donald Trump,” Bloomberg, September 7, 2023, https://www.bloomberg.com/news/articles/2023-09-07/mexico-s-xochitl-galvez-on-nearshoring-insecurity-donald-trump?sref=QmOxnLFz.
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