Unlike Mexico, Brazil’s relationship with China is bolstered by their joint membership in the BRICS economic bloc. Just one day after the railway was announced — which would offer an alternative to the Panama Canal (no longer under Chinese control) — U.S. President Donald Trump stated that BRICS countries would face an additional 10% tariff, echoing earlier moves by his administration.

The next day, Trump accused Brazil of political persecution of its former president and announced a second tariff: a 50% tax on Brazilian exports. Despite that, Brazil’s trade balance currently leans toward China.

In 2024, according to Brazil’s Foreign Trade Secretariat (Secex), China was the country’s top export destination, with exports totaling US$94.4 billion. The U.S. came second, at US$40.3 billion.

China is also Brazil’s largest import partner. In 2024, imports from China totaled over US$63.6 billion — underscoring the mutual economic interest.

Data from SiiLA’s Market Analytics platform shows that the second-largest occupier of industrial properties in Brazil is a Chinese company: Shopee, second only to Argentina’s Mercado Livre.

Back in Mexico, the country's close ties with the U.S. present a hurdle for China’s expansion. On one hand, Beijing is more cautious about exposing sensitive technologies so close to Washington’s sphere of influence. On the other, the U.S. continues to block the sale or export of equipment, software, and systems developed or controlled by Chinese companies — even if assembled in North America — citing espionage concerns.

In this context, Mexico becomes both a target and a tool. For China, it’s a gateway into the U.S. market; for the U.S., it’s a strategic frontline. Every Chinese-built system or device on Mexican soil becomes a diplomatic balancing act.

Today, over 200 Chinese companies operate in Mexico’s commercial real estate sector, 47% of which are focused on the automotive industry or its supply chain, according to SiiLA data. Local manufacturers and service providers act as regional platforms for Asian brands through production, logistics, or representation. One such example is LTD Solutions, which produces for companies like CATL and Foton.

The issue with being an intermediary — dependent on both superpowers for industrial access — is the pressure to maintain neutrality. Some companies attempt to circumvent trade barriers using fiscal triangulation, relabeling origin countries, or third-party intermediaries. The U.S. government argues these tactics amount to indirect imports of Chinese goods, which should fall under USMCA restrictions.

With more than 80% of its exports going to the U.S., Mexico cannot afford to ignore Washington’s signals. According to The Wall Street Journal, Mexican authorities may have stalled BYD’s factory plans due to concerns over bilateral relations — especially under Donald Trump. But this case is not isolated. China has begun recalibrating its industrial strategy to better align with U.S. supply chains, by increasing Chinese imports, reinforcing North American value chains, and emphasizing local content in strategic sectors like automotive, electronics, and semiconductors.

Even as it aligns with the U.S., Mexico avoids a full rupture with China, its second-largest trading partner. Despite all this, BYD and other Chinese companies continue trying to enter the Mexican market. The message is clear: as long as Mexico maintains an ambiguous position of U.S. dependence, Chinese investment will remain a source of leverage — and risk — in its industrial sector.

The bigger question is whether foreign investment — from China or elsewhere — is being used to build industrial autonomy or merely facilitate outsourced operations. So far, many new ventures follow the same model: simple assembly with low added value, aimed primarily at exporting to the U.S. Without a clear industrial policy, Mexico risks becoming a transit zone — rather than a transformation hub.