Nearshoring in Mexico:

The future is looking bright for Mexico. The 15th largest economy in the world and largest trade partner with the United States is riding on a wave that could yield enormous growth and better living conditions for millions. That is, the growing trend of nearshing. Through this practice, Mexico—a long time ally of the United States—has positioned itself as a crucial partner for the future of international commerce. As the developed world seeks to detangle supply chains away from China, its close proximity to the United States, as well as its established record in global commerce make it a perfect destination for multinational companies to set up shop. In the words of Bloomberg, we are living through Mexico’s moment. But what does this actually mean and why is Mexico benefiting over other nations?

The Panama Paradox:

If in the last weeks you’ve heard any news about the Canal, it was likely about decreased rainfall and trade disruptions. Yet despite the hurdles, the Panama Canal Authority recently published its annual report for 2023. In it, we found what seems to be a contradiction. Despite low water levels and decreased flow starting in the latter half of the year, the Panama Canal saw revenues grow by 14.9%. Such is the modern Paradox of the Panama Canal. In a world of lower trade flow, the authority managed to increase profits.

Manufacturing in Mexico

Now, more than ever, Mexico’s manufacturing industry is drawing attention from global experts. In part, one could think this was to be expected. After all, Mexico is currently the 14th largest economy in the world and a powerhouse for global trade, exporting over 474 billion USD of goods in 2021 alone. Moreso in the world of manufacturing, where companies have invested millions of dollars to set up shop in Mexico accessing large industrial facilities, a network of existing trade agreements, and relatively low labor costs. The sector is of such prominence that, in 2022 alone, it accounted for 36% of all Foreign Direct Investment (FDI) to the country (roughly 12.7 billion USD). 

Why we should care about Baltimore

At this point, everyone in the world of supply chains has grown familiar with the tragedy that struck Baltimore. The MV Dali—a container ship operated by Maersk—crashed against the Francis Scott Key Bridge earlier this month. The cause of the accident remains unclear, although most evidence suggests that the MV Dali suffered from a meaningful power malfunction. The events themselves are tragic, and only now, are we facing the first signs of its impact in supply chains. Many of which might be underplayed by an initial misjudgment—more so when it comes to the auto sector.

What is Offshoring? 

Few practices have reshaped the global economy as offshoring and its close cousin outsourcing did in the mid and late 20th century. The pattern, which many saw as a clear application of economic theory, soon became second nature amongst large companies. In a matter of years, corporations came to embrace a multinational approach, making offshoring a norm. 

How Mexico Became the US Top Trade Partner

Earlier this year, a historic event took place. For the first time in close to two decades, China was dethroned as the largest exporter to the US. In the early 2000s, China’s main rival for the title was Canada, which had historically led trade relations with the world’s largest economy and its southern neighbor. But this time, a new challenger has taken the throne. As China’s economy faces internal turmoil and resistance from developed nations, Mexico—which had often trailed behind Canada when it came to exports—has taken the lead.

How to define an Import 

Every day, millions of goods are transported across the world in hopes of finding a consumer. At times, the process is simple and requires nothing more than moving a product from a factory to a store. Other times, however, logistics get complex and need to arrange transportation across various regions and even countries. The latter cases have increasingly become the norm as the world grows ever more connected and trade becomes the foundation to modern economics—in less than a century,  the WTO estimates that overall trade went from less than $10 bn to close to $2.5 trillion. If anyone hopes to understand such a process, they must also, in turn, look at the building block to globalization. And, in such a process, there is no concept as essential as that “imports” which we now look to in depth.

What does eta mean?

ETA is a term shared by a great variety of industries—some niche, and others part of our daily routine. If you’ve ever worked in the logistics sector, waited for some form of public transport, or even ordered something online, odds are you’ve come across the term. It is one of the most popular acronyms that not only emerges in casual text exchanges, but also in everyday life.

What is nearshoring? | Defined and explained

In the last couple of months, you’ve probably heard the term “nearshoring” being thrown left and right. Most often, it is paired with discussions of international commerce and economic outlooks for the near future in North America and beyond. You likely heard of it with some political discussion hinting at coming changes in the structure of the global economy and major shifts in international supply chains. But before delving into the complexities of the term and its implications, it is crucial to define it.

What is a TEU?

If you work in the world of logistics or are generally interested in news about trade, you might’ve encountered the term TEU in one form or another. But what does it mean and why is it important to supply chains?