By Luis Manuel Hernández G.
A bet on reshoring and deregulation
Many of us know that not all success comes from hard work, and not all failure is due to laziness.
It’s interesting how a coalition of sectors, business chambers, and government entities launched the Made in America Manufacturing Initiative during the second week of March 2025. What’s even more interesting is that it was promoted by the SBA (Small Business Administration), with two main objectives: first, to reduce regulatory barriers in the U.S. to allow more businesses to open, and second, to provide loans for the acquisition of industrial properties, construction, and purchase of fixed assets.
However, this scenario can also be interpreted as a call to action for Mexico. In light of the U.S.-driven reshoring strategies, our country holds key advantages: irreplaceable geographic proximity, a current legal framework under the USMCA, and a strong export platform. With the right public policies in place, nearshoring could further accelerate the attraction of projects focused on advanced manufacturing, clean technology, and resilient supply chains—thus reinforcing Mexico’s role as a key partner in this new stage.
President Donald Trump stated that this initiative aims to promote reshoring, where companies operating outside of the U.S. and looking to avoid tariffs will be prioritized. His Vice President made it clear: “If you invest in America, in American jobs, American workers, and American businesses, you will be rewarded.”
The focus on deregulation directly addresses the inefficiencies caused by bureaucracy—specifically, how burdensome processes are limiting investment in the U.S.
On the financing side, it’s worth noting that small manufacturing businesses account for 4.7 million direct jobs, with a payroll exceeding $200 billion. Therefore, it’s crucial to evaluate how many jobs could be lost along Mexico’s northern border. Even if we maintain the 5-to-1 cost ratio—meaning that what you pay for 5 jobs in Mexico equals 1 in the U.S.—the financial structure being offered by the U.S. is very attractive. Loans will be granted based on U.S.-based assets for the purchase of properties, land, fixed assets, and with an emphasis on automation.
And what about Mexico? Competitiveness, productivity, and border risks
If an American company decides to cut ties with suppliers in China or Mexico, it wouldn’t be due to cost, delivery times, or quality. It would be to avoid the high cost of tariffs. Unfortunately, many companies are not returning to the U.S.; they’ll instead seek neutral countries for production—placing Mexico at a disadvantage.
We’ve discussed this in multiple forums, meetings, and summits: as a country, we must become more productive. According to the 2024 OECD hourly productivity index, the USMCA countries rank as follows: the U.S. at #12, Canada at #22, and Mexico at #74.
Finally, we must accept that manufacturing employment as a percentage of total jobs has declined in most countries over the last 20 years (2003–2023). For example:
- U.S.: from 13% to 10%
- Mexico: from 22% to 17%
- Japan: from 19% to 16%
- Canada: from 15% to 9%
- China is the notable exception, growing from 13% to 29%.
If we look beyond percentages, the reality is that the current and future core of global manufacturing remains in China. Moving that volume elsewhere is simply not feasible. The real measurement will come from the value of supply chains—not from macroeconomic indicators.
Organizations like Tijuana EDC play a key role in this landscape, facilitating dialogue between the public and private sectors, attracting strategic projects, and promoting the region’s competitive advantages. In a global context where investment decisions demand speed, certainty, and vision, having committed and experienced local partners is essential to turning challenges into sustainable opportunities for Mexico.
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