Quebec, CanadaSeptember 24th, 2020

CUSMA CPTPP

Luz María de la MoraUndersecretary for Foreign Trade

The Mexico-Quebec bridge

USMCA, CPTPP and other 11 FTAs connect the Mexican economy with 50 countries in 4 continents and more than 1.3 billion consumers (60% of the world’s GDP)

Mexico: 7th largest exporter in the world and 1st in Latin America

Agreements: 11 free trade |46 countries| 32 BITs |6 economic complementation | 3 partial scope.

CUSMA CPTPPOpportunities

NAFTA created one of the most competitive and dynamic regions in the world

FDI

$329Billion dollars

20.2% of world FDI (2019)

1st recipient in the world

Source: IMF, UNCTAD and WTO.

493Million people

$24Trillion dollars

Population GDP Trade

$6 Trillion dollars

6.5 % of world

population

28.2% of world GDP 1st global economy

(2019)

15.9% of global trade

2nd global exporter (2019)

44 5368

8397 105

123151 144 145 147

168188

217 230 241

193

249

285299 310

329 319 313338

372 385

46 56 5569

84 96 108132

118 111 109 116 125 138 147161

120

154184 195 197 205 197 189

204227 216

91 110124

152181

200231

282 262 256 257284

313

355377 401

313

403

469494

507534

516 502

543

599601

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Mexico- NAFTA Trade(Billion dollars)

Exports Imports Trade

Source: Banco de México.

Average annual growth rate 19/93: 7.5%

Mexico trade with NAFTA partners

Fuente: SE/DGIE

1999-June 2020:

599 BFrom the USA:

279 BFrom Canada:

44 B

Foreign Direct Investment under NAFTA

0

10

20

30

40

50

60

70

80

90

100

0

50

100

150

200

250

300

I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

U.S.A. Canada

NAFTA: 323.7 B

USA and Canada account for morethan half of total FDI received byMexico between 1999- June 2020.

We produce together to compete globallyNAFTA FDI in Mexico

Source: DGIE/SE.

Accumulated FDI 1999-June 2020, Canada and USA (US Billion)

46.6% Manufacturing

150.7

43.2

33.2

20.4

17.3

16.0

12.7

8.8

6.7

4.4

4.4

3.0

1.1

0.6

0.4

0.3

0.1

Manufacturing industries

Financial services and insurance

Commerce

Mining

Transportation and warehousing

Accommodation and food services

Real state and rental services

Information

Construction

Business support services

Professional services

Electric power generation and transmission

Agriculture and fishing

Others

Lesisure services, cultural and sports

Educational services

Health services

USMCA

ü Certainty

ü Clear Rules

üMaintains Free Trade

ü Preserves North American Integration

1. Initial Provisions and General Definitions

12. Sectoral Annexes 23. Labor

2. National Treatment and Market Access for Goods

13. Government Procurement 24. Environment

3. Agriculture 14. Investment25. Small and Medium-sized Enterprises

4. Rules of Origin ** 15. Cross-Border Trade in Services

26. Competitiveness

5. Origin Procedures 16. 27. Anticorruption

6. Textiles and Apparel 17. Financial Services28. Good RegulatoryPractices

7. Customs and Trade Facilitation 18. Telecommunications

29. Publication and Administration

8. Energy 19. Digital Trade30. Administrative and Institutional Provisions

9. Sanitary and Phytosanitary Measures 20. Intellectual Property 31. Dispute Settlement

10. Trade Remedies 21. Competition Policy32. Exceptions and General Provisions

11. Technical Barriers to Trade 22. State-Owned Enterprises 33. Macroeconomic Policies

34. Final Provisions

10 New Chapters

24 Modernized Chapters

**strengthen North American productive integration

USMCA: New areas of public policy will lead to wider and deeper integration among 3 partners

Regional Competitiveness

Preferential access

Regulatory coherence

Investment

SPS

TBT

Economy of the 21st

Century

Intellectual Property

Digital Trade

Financial Services

E-Commerce

Certainty in Trade and Investments

Dispute Settlement Mechanisms

State-to-State

Investor-State

Remedy Laws

Inclusive and Responsible Trade

SMEs

Gender

Labor Rights

Anticorruption

Environment

CPTPPOpportunities

CPTPP in numbers

Source: FMI y OMC.

11Trilliondollars

GDP

13.0% worldwide

506Million people

Population

6.7 % worldwide

5.8Trillion dollars

Trade

15.2% worldwideCPTPP countries imported2.8 trillion dollars from theworld in 2019, of whichalmost 1 trillioncorresponds to the 6 newmarkets for Mexico.

Exports from Mexico to the 6 new markets accessed throughCPTPP, grow at a AAGR* of 5.3%, adding 2,497 million dollars(in 2019), while those destined for the rest of the world, grew4.9%.

*Average anual growth rate

CPTPP

Non-USMCA,

§ Promotes economic integration and cooperation

§ Commitment to maintain open markets and increase world trade

§ Creates new opportunities

§ Inclusive, sustainable development

1. Initial provisions and general definitions 11 Financial Services

21. Cooperation and CapacityBuilding

2. National Treatment and Market Access for Goods 12. Temporary Entry

22. Competitiveness and Business Facilitation

3 Rules of Origin 13. Telecommunications 23 Development

4. Textiles and Apparel14. Digital Trade

24. . Small and Medium-sized Enterprises

5 Customs and Trade Facilitation 15. Government Procurement 25. Regulatory Coherence

6.Trade Remedies16. Competition Policy

26. Transparency and Anticorruption*

7. Sanitary and Phytosanitary Measures

17. State-Owned Enterprises and designated monopolies

27. Administrative and Institutional Provisions

8.Technical Barriers to Trade18. Intellectual Property 28. Dispute Settlement

9. Investment 19. Labor29. Exceptions and General Provisions

10. Cross-Border Trade in Services

20. Environment 30. Final Provisions

* USMCA has an Anticorruption Chpater, but not one on Transparency.

13

Mexico’s trade with CPTPP countries

Source: Banco de México.

2.9% 19/18

• In the last 10 years, exports to CPTPP countries increased 40.9%.

17.0 18.0 19.5 18.5 19.2 19.0 20.6 21.924.7 24.0

34.638.0 38.0 38.2

40.842.9 43.6 44.6

47.250.051.6

56.0 57.5 56.760.0 62.0

64.2 66.6

72.0 74.0

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Exports Imports Trade

Billion US dollars

Why Mexico is a key partner?

Opportunities as export platforms

CPTPP

USMCA

CPTPP Trade 2019US$ 5.8 Trillions

(15.2% Worldwide)

Source: WTO.

USMCA Trade 2019US$ 6 Trillions

(15.9% Worldwide)

MEXICO and CANADA

38.6% del mundo

126Million people

1.3Trillion dollars

916Billion dollars

33Billion dollars

1.7% worldwide

1.5% worldwide

2.4%worldwide

2.0% worldwide

FDIPopulation GDP Trade

Source: IMF, WTO, Banco de México and UNCTAD. *Imports-imports method

37Billion dollars

4.03% of total trade

BilateralTrade*

37Million people

1.7Trillion dollars

911Billion dollars

50Billion dollars

0.5% worldwide

2.0% worldwide

2.4%worldwide

3.1% worldwide

FDIPopulation GDP Trade

37Billion dollars

4.06% of total trade

BilateralTrade*

Baja California

Baja California Sur

Sonora

Chihuahua

Coahuila

NuevoLeón

Tam

aulip

as

Sinaloa

Durango

Zacate

cas

San Luis Potosí

Nayarit

Jalisco

Ags.

Guanajuato

ColimaMichoacán

Guerrero

CDMX

MorelosVeracruz

Oaxaca

Tabasco

Chiapas

Campeche

Yucatán

Qui

ntan

aRo

oQuerétaro

Edo.

Mex

Puebla

Tlaxcala

Mining

• Baja California Sur

• Chihuahua• Durango• Guerrero• San Luis Potosí• Sonora• Zacatecas

Transport manufacturing

• Coahuila• Nuevo León• Querétaro

Temporary accommodation

services

• Jalisco• Nayarit• Quintana Roo• Oaxaca

Pipeline transportation

• Colima• Guanajuato• Hidalgo• Sinaloa• Veracruz

Credit intermediationinstitutions

• Aguascalientes Michoacán

• Baja California • Morelos• Chiapas • Tabasco• Mexico City • State of Mexico • Yucatán

Generation, transmission and distribution of electric power

• Campeche• Tamaulipas

Stock market, stock exchange, and financial

investment activities

• Puebla• Tlaxcala

Canada´s FDI in Mexico

Source: National Registry of Foreign Investment

Mexico’s FDI in Canada

Source: Statistics Canada

1,283

2,120 2,148

1,6871,811

2015 2016 2017 2018 2019

(USD million)

Mexico offers a solid infrastructure and logistics network

According to the WEF, Mexico ranks among the top 30% countries withbest transport infrastructure.

172,000 km roads, where 62.4% of México’s total exports move.

27,000 km railway tracks, move 13% of Mexico’s total exports

117 Ports move 19.7% of Mexico’s total exports

76 Airports (64 int. + 12 nat.) move 4.3% of Mexico´s total

exportsSource: SecretarÍa de Economía with data from INEGI.

Mexico leads in manufacturing production

Mexico became the 6th largest world producer of vehicles (2019) 1 and ranked 4th as exporter

worldwide (2018) 2.

6th largest supplier of aircraft parts to the USA (2019)3.

6th largest exporter of information technologyproducts and services (2018)4.

8th largest exporter of medical devices worldwide (2017)5.

1 Source: http://www.oica.net/category/production-statistics/2018-statistics/2 Soure: https://www.wto.org/spanish/res_s/statis_s/wts2019_s/wts2019_s.pdf3Source https://legacy.trade.gov/td/otm/assets/aero/AeroTop20SuppliersAnnual.pdf4Source CANIETI https://esemanal.mx/2019/10/desciende-mexico-a-la-sexta-posicion-como-exportador-de-servicios-de-ti/5 Source: AMID. https://amid.org.mx/wp-content/uploads/2019/06/Descargable-de-la-secci%C3%B3n-Datos-de-la-industria-.pdf

2%

3%

4%

4%

6%

6%

8%

20%

20%

23%

0% 5% 10% 15% 20% 25%

Stone

Metals

Chemicals

Textiles

Minerals

Services

Agriculture

Electronics

Machinery

Vehicles

Source: The Atlas of Economic Complexity. High Complexity Sectors Low Complexity Sectors

With more than 2/3 of its exports in high complexity sectors, Mexico ranksas the 19th most complex economy

Mexico has a diverse and innovative industrial platform

Industry share of Mexican exports by economic complexity, 2018

18

20

26

29

36

43

47

53

59

61

61

67

71

92

223

490

0 100 200 300 400 500

Chile

Netherlands

Colombia

Canada

Australia

Poland

Spain

Italy

Korea

France

Turkey

United Kingdom

Germany

Mexico

Japan

United States

Subscriptions, millions

Mexico is third in mobile broadband suscriptions within OECD

74%mobile

penetration rate

17%annual growth in past 5 years

92Mmobile broadband

suscriptors

Internet connectivity and broadband access supports 4th IR, IOT, digital economy

Young, competitive and skilled workforce

17%

12% 12%

8%7%

0

2

4

6

8

10

12

14

16

18

20

Mexico India Brazil SouthAfrica

Indonesia

Share of graduates come from engineering programs, 2017

Source: UNESCO

6%

22%

45%

16%

10%

0%5%

10%15%

20%25%30%35%40%45%50%

14 - 19 20 - 29 30 - 49 50 - 59 60 +Age group

Economically active population in Mexico by age, Q1 2020

Source: INEGI

Source: Secretary of Economy of Mexico with data of Statistics Canada and Bank of Canada

PRINCE EDWARD ISLAND

YUKON

WHITEHORSE

BRITISH COLUMBIA

VICTORIA

TERRITORIOSDEL NORESTE

YELLOWKNIFE

ALBERTA

EDMONTON

SASKATCHEWAN

REGINA

MANITOBA

WINNIPEG

NUNAVUT

ONTARIO

TORONTO

OTTAWA

QUEBEC

QUEBEC

NEWFOUNDLAND AND LABRADOR

ST. JOHN’S

NOVA SCOTIA

HALIFAX

CHARLOTTETOWN

NEW BRUNSWICK

FREDERICTON

Trade Mexico-Quebec

2.8 Billions USD Total trade Mexico and Quebec

(GAR) 2018: 20%2019: -10%

Ontario was Mexico’s primary provincial trading partner, capturing almost three quarters (72.83%) of total bilateral trade, followed by Quebec (8.71%), Alberta (6.17%), and British Columbia (5.67%).

1 United States $ 50.13 73%2 China $ 2.35 3%3 Germany $ 1.41 2%4 Japan $ 1.24 2%5 Mexico $ 1.23 2%

Total $ 68.79 100%

Top destiny of exportsBillion of USD (2019)

Top origins of imports Billion of USD (2019)

1United States $ 24.60 41%2China $ 8.96 15%3Germany $ 3.19 5%4France $ 2.88 5%5United Kingdom $ 2.21 4%8Mexico $ 1.65 3%

Total $ 60.69 100%

17% of Canada

15% of Canada

Access to lectures onCPTPP and USMCA

provisions.

USMCA/CPTPP Seminar and Texts

https://www.youtube.com/user/seconomiamexico

https://www.gob.mx/cms/uploads/attachment/file/120133/Capitulado_completo_del_Tratado_de_Asociaci_n_Transpac_fico_en_ingl_s_03082016.pdf

Texts of the Agreements(English versions)

• USMCA

• CPTPP

https://ustr.gov/trade-agreements/free-trade-agreements/united-states-mexico-canada-agreement/agreement-between

WomanExportingMx1st E-Business matchmaking event

Registration open: 9th to 28th September

For Mexican businesswomen trading with Canadian companies

https://www.gob.mx/se

Merci beacoup! Dr. Luz María de la Mora

Quebec, Canada September 24th 2020

luzma.delamora@economia.gob.mx

@luzmadelamora

@luzmadelamora

2020

September 21, 2020

Thank you! Dr. Luz María de la Mora

luzma.delamora@economía.gob.mx

@luzmadelamora

@luzmadelamora