How Chinese firms are using Mexico as a backdoor to the US - BBC News

Chinese firms are racing to set up factories in Mexico to bypass US tariffs and sanctions.

15 hours agoShareclose panelShare pageCopy linkAbout sharingImage caption, Manufacturing in Mexico allows Chinese firm Man Wah to get past US tariffsBy Will GrantBBC Mexico correspondent, MonterreyThe reclining armchairs and plush leather sofas coming off the production line at Man Wah Furniture's factory in Monterrey are 100% "Made in Mexico".

They're destined for large retailers in the US, like Costco and Walmart. But the company is from China, its Mexican manufacturing plant built with Chinese capital.

The triangular relationship between the US, China and Mexico is behind the buzzword in Mexican business: nearshoring.

Man Wah is one of scores of Chinese companies to relocate to industrial parks in northern Mexico in recent years, to bring production closer to the US market. As well as saving on shipping, their final product is considered completely Mexican - meaning Chinese firms can avoid the US tariffs and sanctions imposed on Chinese goods amid the continuing trade war between the two countries.

As the company's general manager, Yu Ken Wei, shows me around its vast site, he says the move to Mexico has made economic and logistical sense.

https://www.bbc.co.uk/news/business-68825118

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