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Mexican state in Trump firing line says U.S. investment holding up
June 9, 2017 / 12:10 AM / 2 months ago

Mexican state in Trump firing line says U.S. investment holding up

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A worker walks past the Carrier Corp air conditioner plant, a unit of United Technologies Corp, in Santa Catarina, on the outskirts of Monterrey, Mexico, February 19, 2016.Daniel Becerril

MEXICO CITY (Reuters) - American investment has stayed steady in a Mexican state that was one of the first to suffer at the hands of U.S. President Donald Trump's drive to bring back jobs from Mexico, the region's economy minister said on Thursday.

Just a few weeks after his election in November, Trump announced he had struck a deal to stop about 1,000 jobs at U.S. manufacturer Carrier from being moved to its Mexican operations in the industrial state of Nuevo Leon, which borders Texas.

Soon afterward, carmaker Ford canceled a planned $1.6 billion plant in central Mexico, causing widespread alarm that Trump's interventions and threats to tear up the NAFTA trade agreement would lead to a collapse in investment in Mexico.

But Fernando Turner, the economy minister of Nuevo Leon, said U.S. companies still were committed to the state and that there had been no slowdown in investment by them because they understand the benefits of Mexico better than Trump does.

"American companies will educate him," he told Reuters.

Turner said U.S. firms were no longer talking about their investments to avoid incurring Trump's wrath.

"Until Trump changes his rhetoric ... there won't be a single global company from anywhere that wants to announce investment in Mexico. (But) they're going to do it," he said.

Nuevo Leon is home to some of the biggest companies in Mexico, including cement maker Cemex (CMXCPO.MX) and conglomerate Alfa (ALFAA.MX). It received a tenth of the foreign direct investment (FDI) to Mexico in 2016 - more than any other region, barring Mexico City.

Provisional government first quarter data showed FDI to Nuevo Leon fell to $585 million from a preliminary figure of $779 million in the same period last year. Nationally, however, the figure rose 0.6 percent to $7.9 billion in the quarter.

Trump's rhetoric has caused anger in Mexico, and Nuevo Leon last month unveiled an economic plan aiming to modernize the economy and reverse a brain drain to the United States.

Reporting by Dave Graham; Editing by Bill Trott

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