Hugo Wong

Opinion | Mexico is ground zero as China takes Global South battle to US backyard

Since its free trade agreement with the US, Mexico has seen more crime and obesity but little economic growth. Now, it is seeing a surge in Chinese investment

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BYD’s Dolphin Mini is seen at the Chinese company’s launch of the low-cost EV in Mexico City, on February 28. Photo: Reuters

Hugo Wong

Published: 5:30am, 9 Jun 2024

The US has imposed tariffs on Chinese electric vehicles and the European Union is expected to do the same, but most countries in the Global South have not followed suit. In particular, Mexico has become China’s second-largest car importer and has seen a recent surge in Chinese investment.

China, the main trading partner of many Southeast Asian and African states, is becoming an important trading country for South America, long seen as America’s backyard.

Given that the Global South represents 88 per cent of the world’s population and 52 per cent of the gross domestic product in purchasing power parity terms, protectionist measures from the West risk isolating their industries – without necessarily ensuring their long-term competitiveness.

Historically, Western polices have triggered China’s engagement with what is now termed the Global South. In the 19th century, Western powers made China doubt its place in the world by treating it like one of their colonies and setting up treaty ports. Chinese migrants seeking fortunes abroad found themselves rejected by xenophobia in Western countries and moved instead to the Global South.

By the early 20th century, with the Chinese Exclusion Act in force in the United States, some 60,000 Chinese migrants ended up in Mexico. Yet, despite this racism at home and abroad, some Chinese elite still hoped to emulate the West to show that China belonged to the North.

In the 1960s, isolated by the West and the Soviet Union, that thinking changed radically. For the first time, China started to claim to belong to the Global South. Through the reform era of the 1980s, China again looked on the US as an economic model. But, in the past decade, partly due to trade tensions, China has pivoted south once more. Like most developing nations, it often sees itself as a past victim of foreign exploitation.