Mexico needs to develop its plastics industry so that Mexican feedstocks - oil and natural gas - go into making Mexican plastic resin, according to Eduardo de la Tijera, a consultant to that nation's plastics industry.
At the Plastics News Executive Forum, held Feb. 1-4 in Summerlin, de la Tijera also played down China as a threat to Mexico's plastics industry.
Some molding work is returning to Mexico from China, he said.
His Mexico City firm, Grupo Texne, reviewed Mexico's plastics industry for the country's national plastics association, Anipac. For the past decade, the industry there has averaged 10 percent annual growth, three times as great as the overall Mexican economy, he said.
The country needs to take advantage of its natural resources and add value by producing more resin domestically, de la Tijera said.
The main problems, he said, are that many of Mexico's 4,500 processors are small and suffer from low productivity. The country also has a $4.5 billion trade deficit in plastics to the United States.
Also, the government ignores plastics processors, he said, adding, ``They have gone so far with so little help.''
He is optimistic, however. When resin capacity is installed in Mexico, demand grows almost instantly, he said. The country also continues to develop its capital goods sector.
China has knocked Mexico from its position as the second-largest trading partner for the United States. Mexico no longer exports products such as shoes and textiles north. But de la Tijera said Mexico needs to tout its advantages over China. He questioned if China is sustainable, and pointed out problems such as violation of intellectual property rights and Chinese protectionism.
Staffed with a skilled labor force, the maquiladora plants near the U.S./Mexico border offer the fastest response to the U.S. market, he said. Maquiladora business accounts for nearly half of all Mexican exports. That work ``is not flying away from Mexico,'' he said.