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Thursday, May 12, 2011

Envoys from China, South Korea say Mexico risks falling behind if it does not sign free-trade agreements

Remarks come at Baja California-Asia forum at Tijuana's Cetys University, which establishes the Asia-Pacific Institute

By David Gaddis Smith

Envoys from China and South Korea said Thursday in Tijuana that Mexico may lose out on economic benefits if it does not sign free-trade agreements with their countries.

Whan-bok Cho mugWhan-bok Cho, South Korea's ambassador to Mexico, said negotiations on a Mexico-South Korea free-trade agreement have been suspended since 2008. He said South Korea has had a free-trade agreement with Chile for seven years, has signed one with Peru and is finishing up agreements with Colombia and Canada. He said the United States and South Korea will have a free-trade agreement in place in August. (Neither country's legislature has yet ratified the pact, however.) He said this pact would make Mexico less attractive for South Korean companies.

Wang-Gang-mugWang Gang, political counselor with the Chinese Embassy in Mexico, said economic and commercial relations with China constituted an opportunity for Mexico, not a threat. Many experts say China's cheap exports have had a debilitating effect on some sectors of Mexico's economy. He said China is capable of making large investments. He said Chile displaced Mexico as China's second-largest trading partner in Latin America in 2009 after Chile signed a free-trade agreement with China.

Scott-Venezia-mugWhan-bok Cho and Wang Gang were among four Asian diplomats speaking at the conference, where it also was announced that Cetys had established the Asia-Pacific Institute headed by business school dean Scott Venezia (pictured at left).

yasushi takaseYasushi Takase, minister of the Japanese Embassy in Mexico, spent much of his speech describing Japan's efforts to recover from the devastating March 11 earthquake and tsunami. Japan and Mexico reached terms for a revised free-trade agreement this year; the first agreement took effect in 2005.

Whan-bok Cho said Baja California have advantages that other Mexican border states such as Chihuahua and Tamaulipas do not have, namely being a gateway to California and its market of 37 million people. He said the large number of universities in Baja California also provide it a great advantage.

foro baja california asia logoHe said he thought Mexicans paid more attention to Europe than to Asia and urged Mexicans to start setting their sights to the west across the Pacific rather than east across the Atlantic.

He cited Samsung being the pioneer of major South Korean investment in Mexico, with its electronics plants in Tijuana and Queretaro. He said Samsung is investing $40 million in Mexico this year and has invested $230 million overall. Whan-bok Cho also spoke about LG. He said said LG, which previously moved electronics production from its Mexicali plant to its Reynosa plant, is going to reopen its Mexicali plant this year. "That is good news for Mexicali," he said. LG also has a plant in Monterrey.

He said South Korea only had its first fair and free multiparty elections in 1987; some say Mexico did not have free and fair elections until the 1990s. He said both South Korea and Mexico have similar GDPs, but that South Korea's per capita income is much higher.

Wang Gang said few Chinese stop in Tijuana; China has flight from Shanghai to Mexico City that includes a stop in Tijuana. He said 30,000 visited Mexico in 2010, joking, "but all of them went to Cancún." Wang Gang, who hardly ever looked up while reading the text of his speech, said he would like to see more Chinese visiting Baja California's wine country.

India's ambassador to Mexico, Dinesh Kumar Jain, had to cancel his appearance because of the death of his mother. His speech was read to the conference. He said Wednesday that he would like to see a free-trade agreement between India and Mexico.

Rachel Moseley, first secretary of the Australian Embassy, said Australia is a great place to do business and to visit. The event was inaugurated by Tijuana Mayor Carlos Bustamante and Baja California Gov. José Guadalupe Osuna Millán.