Mexico's Nearshoring Opportunity Hindered by Infrastructure Woes
Mexico's nearshoring gains are threatened by logistics woes. Poor roads, rising cargo theft, and severe customs bottlenecks at key hubs create costly delays. Urgent infrastructure, security, and customs improvements are needed to fully capitalize on the opportunity.
Mexico stands at a potential inflection point, poised to capture significant economic benefits from the global nearshoring trend as companies seek to shorten supply chains and reduce reliance on distant manufacturing hubs. Drawn by its strategic geographic proximity to the vast US market, competitive labour costs, and extensive network of trade agreements spanning 50 nations, businesses are increasingly looking south of the border. However, mounting evidence suggests that critical deficiencies in the country's logistics infrastructure and operational environment pose substantial challenges, potentially capping the upside of this manufacturing realignment.
The concept of nearshoring – relocating production closer to end markets – inherently relies on efficient and reliable logistics. As highlighted by a study from the Mexican Institute of Public Accountants (IMCP), while the trend offers "unequalable opportunities," it simultaneously exposes significant logistical "challenges." The success of attracting and retaining investment hinges directly on the ability to move goods swiftly and cost-effectively. Mexico's Confederation of Industrial Chambers (CONCAMIN) underscores this point, noting that an efficient supply chain, capable of reducing costs and delivery times, is fundamental to capitalizing on the nearshoring wave.
