US and Mexico cooperate on semiconductors and electric vehicles

MEXICO CITY (AP) — Mexico and the United States plan to take advantage of the Biden administration’s massive investment in semiconductor production to push the integration of their supply chains and cooperate on expansion electric vehicle production through Mexico’s nationalized lithium industry, officials from both countries said on Monday

Both efforts are aimed at eating away at Asia’s advantage in the semiconductors and batteries needed for electric vehicles and promoting North American production.

They were among the main topics discussed in and on the sidelines of the high-level economic dialogue between the two countries in the Mexican capital.

“Major elements of semiconductor supply chains are already well established in Mexico, with U.S. companies like Intel and Skyworks conducting research and development, design, assembly and test manufacturing in some parts of Mexico,” U.S. Secretary Antony Blinken said.

Blinken and U.S. Commerce Secretary Gina Raimundo had earlier in the day spoken with Mexican President Andrés Manuel López Obrador about opportunities for Mexico to take advantage of recently passed U.S. legislation that would provide $28 billion in incentives for semiconductor production, $10 billion for new chip manufacturing, and $11 billion for research and development.

López Obrador, for his part, explained his intention to make the northern border state of Sonora a leader in the production of lithium, electric vehicles and solar energy, said Mexican Foreign Secretary Marcelo Ebrard. Lithium is a key component of batteries for electric vehicles. The president said last month that he had already discussed the idea with US President Joe Biden.

Blinken said other new US legislation aims to encourage the shift to electric vehicles and the production of the batteries they need in North America.

Ebrard said it was a great opening for the Mexican economy.

“It means more jobs for Mexico, more integration,” Ebrard said. “We think Mexico could grow twice as much with what was offered in Mexico today and that means we can reduce poverty even faster in our country and Mexico’s infrastructure can grow faster. “

The dialogue, launched by then-Vice President Biden in 2013, resumed last year in Washington after stalling under the Trump administration.

The global shortage of semiconductors has spilled over into the production of automobiles, household appliances and other goods, fueling high inflation. Biden appeared at the future site of a massive Intel factory in Ohio on Friday.

Last month, López Obrador said the government had created the state-owned lithium company which would be in charge of exploring for and extracting the ore. Mexico nationalized lithium production in May.

Asked about ongoing trade disputes between the United States and Mexico in the energy sector, officials from both countries played down the disputes and stressed that there was a separate process to resolve such disagreements as part of their trade agreement and that it was not an item on the agenda of these meetings.

Ahead of the talks, Assistant Secretary for Western Hemisphere Affairs Brian Nichols, who was also present, said one of the talks’ priorities was to promote development in southern Mexico and Central America.

Encounters between U.S. border agents and migrants from the Northern Triangle countries — El Salvador, Honduras and Guatemala — have declined this year compared to last year, although overall encounters at the border have increased this year, according to U.S. Customs and Border Protection data. . Encounters with Mexican migrants have also been higher for most of the past year.

More recently, Mexico has avoided direct confrontations with migrants moving through its territory, instead regularly offering them temporary documents to relieve pressure on its southern border.

López Obrador has been criticized by some international and national organizations for transferring the recently created National Guard to the Ministry of Defense. In many ways, the military was already leading the force—and filling its ranks—but it had been created as a civilian force. López Obrador criticized the UN and the Organization of American States for expressing concern over the decision.

Mexico continues to struggle with high rates of violence. On Friday, the UN special rapporteur on the human rights of internally displaced people said violence linked to drug cartels in Mexico was the main driving force behind internal displacement. . She called on the government to create an official register of displaced people, but said data collected from non-governmental organizations suggested there were around 400,000.

The talks come days before Mexico is due to celebrate its Independence Day, to which López Obrador has invited figures such as revolutionary leader Ernesto “Che” Guevara’s daughter and Wikileaks founder Julian Assange’s father.

During López Obrador’s daily press conference on Monday, the president said he planned to submit a proposal to the UN aimed at ending Russia’s war in Ukraine. López Obrador, who has not joined other countries in imposing economic sanctions on Russia, has proposed creating a mediation commission made up of Pope Francis, UN secretary general and Indian prime minister, which would open talks between the Russian and Ukrainian presidents.

Leave a Comment