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Emilio CadenaJun 17, 2024 4:23:29 PM3 min read

The Nearshoring Series: Impact on Investment and Economic Development

The Nearshoring Series: Impact on Investment and Economic Development

In today’s globalized world, investment and economic development strategies are constantly evolving, influenced by a variety of sectoral and regional factors. In this blog, I explore the key trends shaping the current economic landscape, highlighting the importance of sectoral and regional differences, the role of American and local companies, as well as the impact of strategies such as reshoring, offshoring and tech-shoring. 

This is the second blog which is part of “The Nearshoring Series” summarizing some of the key conversations I have had with important stakeholders in recent months. 


The Expansion and Dynamism of the Electronics Sector 

Investment and the impact of global phenomenons not only vary significantly among different sectors and regions, but also reflect the complexity of the global economy. In particular, the electronics sector stands out for its dynamism, where Asia is positioned as a hub of activity. Countries such as China, Taiwan, Korea and Singapore not only lead in terms of production and supply worldwide but also play a key role in innovation and technological development. This dominance in the electronics sector illustrates the importance of understanding sectoral and regional specificities to analyze global investment trends, highlighting the differentiated impact that global events can have on different market areas. 

And with global trade dynamics changing at a rapid pace, electronics supply chains are certainly evolving. Asian countries continue to dominate the sector, but Western pressures have seemed to spark a renewed search for the optimal supply chain. It is evident when looking particularly at Mexico and Vietnam’s increased role in this sector is just the last years. Mexico and Vietnam experienced significant increases in their shares of US imports in various types of electrical and electronic equipment: in the case of Vietnam, these were microphones, electric generating sets, and telephone sets, while in the case of Mexico, these were discs, tapes and storage devices and calculating machines. 

China’s exports to Vietnam were already growing at a fast 10.2 percent annually between 2013 and 2017 but increased even further to 11.5 percent between 2017 and 2023. This trend is even more stark for China’s exports to Mexico: These grew at an annual pace of 5.5 percent between 2013 and 2017 and accelerated to 14.6 percent between 2017-2023.  

In Mexico, Chinese firms' foreign direct investment (FDI) in the manufacturing sector grew fivefold from US$31.6 million in 2017 to US$151.5 million in 2022. China’s share in the total value of FDI into Vietnam rose sharply from 0.004 percent in 1999 to 7 percent in 2017. This suggests a potential shift in China's own manufacturing strategy, with Mexico and Vietnam emerging as key players in a diversifying electronics supply chain landscape. It is not going unnoticed by the Western world. 



In the electronics sector, Western companies are not just advancing, but spearheading the reshoring movement and embarking on substantial expansions. This strategic approach not only enhances their local presence but also solidifies the region's status as a pivotal hub for production and innovation in electronics. This trend highlights the region's growing prominence on the global electronics industry map and underscores the importance of localizing production to consumer markets. Additionally, it fosters a local innovative ecosystem poised to support and drive future growth. 


Nearshoring Dynamics, Emphasizing American and Local Companies 

Specifically, in cities like Monterrey, investment related to nearshoring has proven to be significant, representing a substantial percentage of economic activity. This underscores the attractiveness of certain regions as key destinations for foreign investment and business expansion.  

From January to April 2024, 14 Chinese manufacturing investments were announced in Mexico worth over and estimated $2.6 billion dollars. Half of them were new investments in the country, totaling over $1.7 billion. The vast majority integrate into the automotive industry supply chains. 

Investment China-Mx


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Despite global competition, American companies and locally established businesses in the city remain crucial for driving investment and economic activity in various regions.  

In conclusion, at Prodensa, we have observed that the economic landscape is characterized by increasing complexity, where skills such as adaptability and strategy become crucial elements for businesses success. Trends like reshoring, offshoring, and tech-shoring, along with the importance of sectoral and regional differences, play a fundamental role in defining opportunities and challenges for companies in today’s global scenario. 

U.S.-Mexico collaboration Emilio

Blog post redacted from recent conversations about nearshoring in different media outlets, part of the “Nearshoring Series”.