MI interview with US-Mexico trade relations expert Tony Payan
Miranda Intelligence spoke with Tony Payan, director of the Mexico Center at the James A. Baker III Institute for Public Policy of Rice University in Houston, TX, to discuss the rapid expansion of US-Mexico energy trade and the USMCA energy dispute, as well as policy changes under a new Mexican president taking office October 1, 2024.
Much attention has been placed on AMLO’s desire for energy independence and that of the US and Canada for changes in Mexican energy policy to open the industry, Payan told MI. but the economic reality on the ground trumps politics. “Trade between the two countries just seems unstoppable, and I think that is definitely symbolized by trade in energy, and this is where there is a natural complementarity between the two countries,” he said.
“Perhaps much to the chagrin of López Obrador who would like to declare before the end of his term … some sort of energy independence or energy sovereignty, Mexico continues to depend heavily on energy imports, in particular from the United States,” said Payan.
The fact remains that almost 80% of Mexico’s natural gas demand is met by imports from the US and Texas in particular, he added. This is a win-win on economic terms, with that gas making possible the manufacture of more affordable goods for the US made in Mexico’s northern states that power their plants with the gas. With the nearshoring phenomenon meant to shorten supply chains in the wake of COVID-19 and geopolitical shocks, this will only become a more powerful motor for this dynamic.
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