Mexico was Australia’s 30th largest trading partner in 2017, with total merchandise trade (exports + imports) worth A$3.4b, making up 0.4% of Australia’s trade portfolio. The main Australian exports included coal, aluminium and meat. Major Australian imports include telecom equipment, ores and concentrates, medical instruments and passenger motor vehicles. Australia is negotiating a Free Trade Agreement with Mexico as a member of the Pacific Alliance (Chile, Colombia, Mexico and Peru).
Service exports to Mexico were worth A$133m in 2017. According to Pricewaterhouse Coopers, the Mexican economy could become larger than both the UK and France by 2050. Mexico’s growing energy needs, emerging middle class and greater infrastructure spending present opportunities for Australian exporters.
Australian wine is becoming increasingly popular and there is scope to raise participation in the processed food industry. There is also potential for water management equipment and environmental services. The mining industry presents an opportunity for Australian mining services companies. Mexico is the world’s largest producer of silver and also produces copper, bismuth and zinc. There is also a large tract of under-explored land which should attract Australian exploration and mining equipment, and technology services companies.
There were over 3,000 Mexican student enrolments in Australia in 2017, making it the fourth largest source of students from Latin America, behind Brazil, Colombia and Chile.
Tourist arrivals oscillated between 6,000 to 7,500 p.a. over much of the last decade, but have been on a steady upward trend since 2015. Indeed, Mexican tourists reached 11,500 in 2017.
While Australian investment in Mexico in 2016 was over A$5.5b, 2017 saw a significant drop in investment to just over A$4b. Australian companies with interests in Mexico are primarily in the mining and related services sector, and include Incitec Pivot, Nufarm, Elders, Azure Minerals, Global Resources Corporation (Cloncurry Metals), Worley Parsons, Chep, Spotless Group, QBE Insurance, UGL Equis, TNA Packaging, Securency, CSL, Orica, Boart Longyear, Boral and Howe Leather. But the US (A$664b) and UK (A$333b) remain the leading destinations for Australia’s foreign investment.
Mexican investment in Australia is small, reaching a high of A$341m in 2016. Mexican investment in the 15 years prior has been miniscule, and often well below A$100m. Whilst total foreign investment in Australia has improved slightly in 2017, there was a significant fall in Mexican investment, falling 48% to A$177m.