After Mexico ratified the North American Free Trade Agreement (NAFTA) in 1994, which led to significant trade liberalization and a shift away from the oil industry, exports took off. NAFTA abolished obstacles to cross-border investment and most tariffs on goods exchanged between Canada, Mexico, and the United States. The 2018 United States-Mexico-Canada Agreement (USMCA), which is mostly analogous to the NAFTA, is expected to maintain Mexico’s robust trading connections with its northern neighbors.
The majority of Mexico’s exports (89 percent) are manufactured goods. Followed by oil and petroleum products (6%). Automobiles make up about 31% of all sales of manufactured goods, with metals, machinery, and equipment as the largest category (69%) and subcategory. Electrical and electronic appliances (18%) and specialized equipment for industries (13%) are two further significant categories. Products from the mining industry make up 1%, while agricultural products make up 4%.
The United States is Mexico’s top export partner (80%), followed by Canada (3%) and Germany and China (both 2%).