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Mexico’s AMLO Visits Central America Amid Increased Trade Exchange

Trade between Mexico and the isthmus has risen by 71% since 2017, with Central American exports totaling $3.3 billion annually and imports totaling $8.3 billion

México and Central America's trade is increasing as Mexico's President Andrés Manuel López Obrador visits the region.
May 06, 2022 | 11:30 am

San Salvador — Mexico’s President Andrés Manuel López Obrador (known by his acronym AMLO) has begun a tour of Central America, a region that has increased its trade with Mexico over the past few years.

AMLO, as Mexico’s president is known, landed in Guatemala on Thursday, will be in El Salvador on Friday and in Honduras, Belize and Cuba on the weekend.

Trade between Mexico and the region has increased over the last five years, with exports from Central America (including Panama) to Mexico up 71% since 2017, from $1.92 billion to $3.29 billion, according to data from Mexico’s central bank (Banxico).

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Surprisingly, the Covid-19 pandemic facilitated the Central American isthmus’ increased exports to Mexico, as between 2019 and 2020 they increased by 11%, and by 41.9% between 2020 and 2021.

Nevertheless, Mexico continues to benefit in terms of the total amount of trade, with a 39% five-year advance, with exports totaling $8.33 billion in goods to the region last year.

Mexico is the most important export market for Nicaragua, accounting for 12.11% of foreign sales, while for Honduras the figure is 11.92%.

On average, Mexico accounts for 5.32% of exports from Central America (including Panama), and which totaled $61.82 billion in 2021.

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Due to their proximity, Mexican companies are well positioned as important partners for sectors such as food and beverages. This sector in Guatemala, for example, represents 11% of the country’s exports, compared with 8% for the U.S., according to the Guatemalan Chamber of Food and Beverages (CGAB).

Both Mexico and Central America saw an expansion in their export volumes last year, according to the Economic Commission for Latin America and the Caribbean (ECLAC).

“In these countries, the composition of exports is intensive in manufacturing, and these have been showing a greater increase in the volume exported, especially in the intra-regional market,” ECLAC said in its report International Trade Outlook for Latin America and the Caribbean.

ECLAC has been promoting its Integral Development Plan (PDI) that seeks to promote economic and social development between the southeast of Mexico, Guatemala, Honduras and El Salvador.

Alicia Bárcena, former executive secretary of ECLAC, said the region has privileged characteristics due to its geographical location, access to two oceans, its natural and cultural diversity, and large youth populations.

“There is a great opportunity for a new economic region. There are 70 million people who can constitute a large market for trade among the four countries,” Bárcena said.