US President Donald Trump’s push to force US firms to bring jobs home is opening investment avenues for Chinese companies in Mexico, an executive with the Industrial and Commercial Bank of China Ltd (ICBC, 中國工商銀行), the country’s largest lender, said on Friday.
Fears of a hit to foreign investment ran high when Ford Motor Co canceled a US$1.6 billion plant in Mexico’s central state of San Luis Potosi in January.
Trump, who had railed against US manufacturers investing in Mexico, hailed the decision as a major victory, but Ford put it down to declining demand for small cars.
US industry’s loss could be China’s gain, ICBC’s Mexico unit head Chen Yaogang (陳耀剛) said.
“If some US investment projects don’t [happen], there has to be somebody to invest... If Chinese companies think it is profitable, they will invest,” he said in an interview on the sidelines of a banking conference in the resort of Acapulco, Mexico.
Last month, China’s Anhui Jianghuai Automobile Group Co Ltd (JAC Motor, 安徽江淮汽車) and Mexico’s Giant Motors Latinoamerica, along with distributor Chori Co Ltd, said they would invest more than US$210 million in an existing plant to build sports utility vehicles in the central state of Hidalgo.
Prior to Trump’s campaign against US manufacturers shipping jobs overseas, Chinese companies were making tentative inroads into Mexico.
China’s BAIC Motor Corp Ltd (北京汽車) in June last year started selling in Mexico its own cars imported from China, and has said that it will look into building an industrial plant in Mexico to produce cars and electric vehicles.
BAIC is already a client of ICBC in Mexico.
ICBC, one of the world’s top banks by market capitalization and assets, received its banking license in Mexico in 2014 and started operations there in the middle of last year.
“JAC, we think, will be a client of ours in Mexico too,” Chen said.
Still, Chinese foreign direct investment in Mexico is a tiny fraction of what US firms have plowed in over the years.
State-controlled ICBC expects to grow its assets and loan portfolio in Mexico 10-fold over the next three years to about 10 billion pesos (US$533 million), Chen said.
The executive said ICBC aims to offer a service to allow clients to convert Mexican pesos to Chinese renminbi and vice versa, and make cross-border transactions cheaper.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by