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Commercial Relations and Diversification of the Economy in Mexico
In this work, different aspects will be analyzed that can help or harm Mexico’s business relations, so it is essential that commercial relations are defined as the exchange between various countries or regions through commercial opening and not They are only political, cultural and technological agreements, but can also be given by the exchange of products and services. Because of this, the hypothesis focuses on knowing if "the diversification of commercial relations strengthens the economy".
While this has had an impressive economic impact due to losses in exports following commercial wars, Trump has caused a negative impact on the economy, so it makes us question: if Mexico had greater commercial partners and eliminate the strong dependence That has with the United States, it would not affect us radically and we could cover ourselves to the impact or diversify the risk.
Currently, the world faces a new era that is that of protectionism, which forces all countries to diversify their markets and seek new foreign relations that encompass comprehensive trade and political agreements in order to strengthen and improve the economy of countries. As is known, Mexico has practically access to all regions of the world; However, economic dependence with the United States is such that it is not advisable. That is why we have the North American Free Trade Agreement (NAFTA) that allows us to have a free trade zone between Canada, the United States and Mexico, resulting in an increase in economic efficiency and if it becomes dynamic greater benefits in economic growth rates, so it increases income, works, higher investments, exports and imports, poverty is reduced. On the other hand, Mexico will always require the investments of the United States, which put it in a limitation.
Although the benefits of commerce are not limited to tangible goods, but can also occur when exchanging work for goods and services, through the exchange of goods present for pacts in future goods, these considering an analysis in the market and analyzing profitability , although derivatives can be used with which you cover yourself if the price can get to rise or lower depending on the position in which it is.
Having greater commercial relations helps to reduce fluctuations in the exchange rate due to conflicts that may occur in the various countries, you have greater options that benefit them. As for purchases and the relationship with suppliers, it will be closer and this makes an increase in goods and services. However, it is essential to respect the agreements established with each country because although we know, Mexico has more than 1 agreement in which the trade agreements that may have for more benefit are established. The disadvantage of Mexico to the other countries is that it can have frictions in decision -making by having allies with countries that are in conflict and if it does not have a control in their finances, it can have a debt because the financing options are going to be higher and can be trusted.
It can be concluded that commercial relations can help strengthen the economy of each country if they are considered and establish the policies to follow, considering that they cannot be financed more than the money they have, they have to look for strategies to have an economy that is found In constant movement and help to increase income, investments and decrease poverty.
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