Taiwan – Global AI Hub

Artificial intelligence, long hailed as a world-changing and digitally disruptive force, is gaining rapid traction. Valued at US$87.04 billion in 2021, the global AI market is projected to surpass US$1.597 trillion by 2030.

 

When it comes to chip manufacturing, Taiwan is an undisputed world leader with a robust ecosystem powered by capable engineering talent.

 

Taiwan’s strategy in the near term is one that marries the island’s hardware heritage with its nascent AI know-how, to produce everyday application solutions that are tested domestically before they are rolled out worldwide.

 

Taiwan’s commitment to AI development is clear. And it starts at the top, with enormous resources poured into government initiatives designed to nurture a robust environment for growth.

 

Taiwan’s foray into AI, backed by its competitive edge and distinct advantages, make it a haven for partnerships with overseas companies and foreign investment.

 

Already, its potential is recognized by many of the world’s foremost companies: Microsoft, Amazon and Google have all set up research and development centers there, and the island is poised to work with more partners beyond its shores.

 

https://www.reuters.com/plus/taiwan-global-ai-hub

Manufacturing in Mexico is having its moment. The US is buying in — and so is China

By John Towfighi, CNN - Published 9:40 PM EDT, Sun April 28, 2024

As US supply chains decouple from China, Mexico’s manufacturing sector is emerging as a winner.

As nearshoring continues and global supply chains are reorganized, Mexico’s manufacturing sector has an opportunity for long-term success.

 

Mexico surpassed China as the top exporter to the US in 2023. Those exports were driven by manufacturing, which comprises 40% of Mexico’s economy, according to Morgan Stanley.

 

US imports from Mexico continued to increase in February, according to April 4 trade data released by the Commerce Department. Meanwhile, Chinese exports to the US were down 20% in 2023, compared to 2022.

 

Amid shifting geopolitics and competition, US and Chinese companies both see potential in Mexican manufacturing: Low labor costs, geographic proximity to American markets and the US-Mexico-Canada (USMCA) agreement — a free trade accord established in 2020 that makes trade in North America more cost-effective and efficient — are all factors contributing to a potential boom.

 

https://www.cnn.com/2024/04/28/business/us-china-mexico-manufacturing-nearshoring-hnk-intl/index.html

Why Chinese companies are flocking to Mexico

Nov 23rd 2023|mexico city

Chinese investments have been pouring into Mexico lately. Last month alone brought two notable ones. The government of Nuevo León, a northern state bordering the United States, announced that China’s Lingong Machinery Group, which makes diggers and other construction equipment, would build a factory that it estimates will generate $5bn dollars in investment. The same day Trina Solar, a solar-panel manufacturer, said it would invest up to $1bn in the state. Both companies and their corporate compatriots can now find a home away from home at Hofusan, a Chinese-Mexican industrial park in Nuevo León.

Chinese companies’ heightened interest in Mexico dates to 2018 when Donald Trump, America’s president at the time, launched a trade war that included raising tariffs on imports from China. His successor, Joe Biden, has kept the tariffs in place. Mr Biden’s own America-first policies, such as the Inflation Reduction Act, are encouraging companies to consider “nearshoring” in North America, in large part to thwart China. The pandemic and the snarl-ups in supply chains it caused also pushed manufacturers to move closer to the American market.

https://www.economist.com/business/2023/11/23/why-chinese-companies-are-flocking-to-mexico

Mexico: Nearshoring, Foreign Investment Create Industrial Opportunities

 

By: C. Kat Grimsley, Ph.D. and Héctor Salazar Sánchez, Ph.D.

 

Industrial real estate emerged as a clear winner during and after the COVID-19 pandemic thanks to increased demand for e-commerce, a new emphasis on nearshoring and greater investment in logistics solutions.

 

In particular, Mexico, with its proximity to the U.S. consumer market, has seen substantial growth in industrial development in recent years. Although notably smaller than the neighboring U.S. market, which has 14.5 billion square feet of industrial property, the Mexican industrial market encompasses 908.5 million square feet across all product types.

 

In 2022, 65% of Mexico’s industrial space construction was concentrated in just four cities — Mexico City (20%), Monterrey (19%), Ciudad Juarez (16%) and Tijuana (10%), the last three of which are states that border the U.S. and have greatly benefited from nearshoring.

 

https://www.naiop.org/research-and-publications/magazine/2023/Spring-2023/business-trends/industrial-spotlight-mexico-nearshoring-foreign-investment-create-opportunities/

China’s $9 Trillion Debt Problem Is A Global One, Too

 

Article by William Pesek

 

Economists wondering where China’s economy is heading have a Lehman Brothers problem on their hands.

 

Too often, analyses on the more than $9 trillion of debt that state banks and other creditors are owed by China’s local government investment arms are framed around a 2008-like crisis. Blame it on breathless speculation about the “Lehman moment” many believe is sure to devastate Asia’s biggest economy.

 

The common thread is a realization that a Chinese model that worked so well for three decades is facing an existential crisis. Even if China doesn’t plunge into a crisis that shakes the globe, the rapid growth needed to surpass the U.S. economy by 2030 or 2040 seem over.

 

https://www.forbes.com/sites/williampesek/2023/09/15/chinas-9-trillion-debt-problem-is-a-global-one-too/?sh=4aded4ae19c7

MIT and Tec de Monterrey team up to boost innovation in Mexico

 

By REBECA RUIZ | MÉXICO CITY CAMPUS

 

In collaboration with Tec de Monterrey, the Massachusetts Institute of Technology (MIT) has presented the MIT REAP Focus Mexico initiative, an entrepreneurship acceleration program from MIT.

 

The aim of the initiative is to identify and propose projects and programs that foster social and economic development through science, technology, innovation, and entrepreneurship.

 

Five work teams have been assembled across Mexico in Chihuahua, Querétaro, Guadalajara, Guanajuato, and Mexico City. Participating in each group are universities, government, entrepreneurs, and companies that will promote initiatives to accelerate development.

 

MIT REAP Director Travis Hunter explained that the aim of this program is for enterprising communities from around the world to get involved with MIT to strengthen business ecosystems through innovation.

 

https://conecta.tec.mx/en/news/national/entrepreneurs/mit-and-tec-de-monterrey-team-boost-innovation-mexico

Mexico seeks to solidify rank as top U.S. trade partner, push further past China

Luis Torres - July 11, 2023

 
Mexico became the top U.S. trading partner at the beginning of 2023, with total bilateral trade between the two countries totaling $263 billion during the first four months of this year.
 
Mexico's emergence followed fractious U.S. relations with China, which had moved past Canada to claim the top trading spot in 2014. The dynamic changed in 2018 when the U.S. imposed tariffs on China’s goods and with subsequent pandemic-era supply-chain disruptions that altered international trade and investment flows worldwide.
 
Mexico’s gains mirror its rise in manufacturing, a key component of goods moving between it and the U.S. During the first four months of 2023, total trade of manufactured goods between Mexico and the U.S. reached $234.2 billion.
 
Mexico positioned as a manufacturing base
 
Mexico’s expanding manufacturing base has offered an alternative to producing in China. Sourcing or producing goods in a nearby country is sometimes referred to as “nearshoring.”
 
More activity in Mexico would support increased bilateral manufacturing with the U.S. It would also bolster Mexico’s standing as the U.S.’ leading manufacturing trading partner, a ranking it achieved in 2022.
 
Luis Torres is a senior business economist in the San Antonio Branch of the Federal Reserve Bank of Dallas.
 
https://www.dallasfed.org/research/economics/2023/0711