Potential Implications of Mexico’s Interest in Joining BRICS

How Mexico’s Admission to BRICS Could Impact National Security

By JJ Davis, Danish Zia
Updated Saturday, April 8th, 2023

THE RUNDOWN

Recent proposals by Republicans in the US Congress for military intervention in Mexico’s cartel war have created controversy between the two countries. Mexican President Andres Obrador has stated that foreign intervention will not be welcome and called such suggestions “irresponsible.” As a result, the Mexican government has renewed its interest in joining BRICS, which could lead to trade and diplomatic complexities with the US in the future.

THE BACKGROUND

Mexico is the second-largest economic power in Latin America, with a significant GDP and purchasing power that make it a crucial gateway to the North American market. Despite having differences regarding immigration and trade, both Mexico and the US have maintained a cordial relationship, which has been mutually beneficial. In December 2022, the two countries celebrated 200 years of diplomatic relations that have encompassed commercial, cultural, and educational ties.

However, recent cartel killings of American citizens near the US border have strained the relationship between Mexico and the US. Some Republican members of the US House of Representatives have used this tragedy to call for US military intervention, including the option of invading Mexico to attack the cartels. In response, Mexican President Andres Orbrador deemed the proposal “irresponsible” and stated that Mexico would not permit a foreign power to intervene.

As a result of these repeated calls for US military intervention, Mexico has expressed renewed interest in joining BRICS, an economic partnership between Brazil, Russia, India, China, and South Africa. Although the partnership with BRICS would mainly be economic, it could make the US Congress more cautious in its dealings and statements towards Mexico diplomatically, as well as diversify Mexico’s foreign relations and increase its global influence. Although the BRICS organization does not have any formal criteria for processing or admitting new members, it has stated that it could expand by five countries in 2023. Mexico has previously participated in several BRICS summits as an observer and a guest, putting the country in prime position to be one of the potential five expansion countries.

While joining BRICS could be positive for Mexico economically and globally, it may cause concerns for the US. Having economic and power rivals such as Russia and China with close economic and political ties with Mexico could influence how the US has to deal with Mexico in the future and could provide these rivals with easier access to the US market.

MEXICO – CHINA RELATIONS

Mexico and China have a strong trade relationship, with China making significant investments in Mexico over the past five years. Chinese exports to Mexico rose by 28% between January 2022 and August 2022, making China Mexico’s second-largest import partner after the US. More than 1,200 Chinese companies have invested in Mexico, including Ganfeng Lithium, which was granted access to a lithium mine in Sonora. Initially, President Obrador wanted to review concessions to the mine’s lithium deposits in favor of a nationalized company, but he chose to relax the review process for Ganfeng, creating a mutually beneficial solution. In 2021, over 50% of the $9.08 billion of exports from Mexico to China were ores, and if Mexico were to be admitted to BRICS, the value of ore exports could increase further.

While the trade relationship between Mexico and China has been positive, Mexico has maintained a neutral political stance towards China. However, Mexico has expressed concern about China’s human rights practices, specifically with regards to the treatment of Uighur Muslims in Xinjiang. In 2020, Mexico was among 39 countries that signed a joint statement at the United Nations expressing concerns about the treatment of Uighur Muslims and urging independent observers to investigate the situation in Xinjiang. Despite this, Mexico has maintained a positive relationship with China, and trade has not been impacted.

MEXICO – RUSSIA RELATIONS

Mexico and Russia have developed a strong economic relationship, with Mexico ranking as Russia’s third-largest trading partner in Latin America. The relationship is mainly based on cooperation in the oil and gas sectors. Russian multinational companies such as Gazprom Marketing and Trading Mexico and Rusatom International have invested in Mexico. Gazprom is a state-owned energy company involved in natural gas sales and distribution, while Rosatom is a state-owned nuclear energy company involved in nuclear power plant development and construction in Mexico.

Unlike the US, Mexico has not imposed any sanctions on Russia. The two countries have maintained a positive diplomatic relationship since 1924, when Mexico became the first country in the Americas to establish relations with the Soviet Union. The focus of their relationship has always been on cooperation and advancement of energy and technology.

The positive diplomatic and economic relationship between Mexico and Russia has helped Russia establish a strong presence in Latin America, second only to Brazil. Gazprom’s and Rosatom’s investments in Mexico have strengthened the countries’ economic ties and led to cooperation in the development of energy and technology.

MEXICO RELATIONS WITH OTHER BRICS NATIONS

Mexico has strong trade relationships with China and Russia, but it is also expanding its ties with the other BRICS nations.

India and Mexico have a positive diplomatic relationship and a bilateral trade partnership that covers multiple sectors, including sustainable energy, climate change, and international security.

Mexico also has a bilateral trade relationship with South Africa, but it is smaller than its relationships with other BRICS nations. The two countries have a positive diplomatic relationship and have cooperated on peacekeeping missions and plans to combat climate change.

Brazil and Mexico are the two most economically powerful nations in Latin America and have a long-standing trade and diplomatic relationship. They have even explored the possibility of a free trade agreement to boost their economic vitality. While the two nations have had diplomatic disagreements about globalization, particularly in relation to Venezuela and Colombia, they have always worked together to maintain economic stability.

THE TAKEAWAY

Mexico has had long-standing relationships with all of the BRICS nations, but primarily relies on Brazil, China, and Russia as its economic trade partners. Joining BRICS would further solidify these partnerships and potentially lead to one of these nations overtaking the US as Mexico’s primary trade partner.

China and Russia have been increasing their investments in Mexico, particularly in minerals, energy, and technology. Russia’s state-owned Rusatom International is helping develop nuclear power capabilities in Mexico, which could be of growing concern if Mexico joins BRICS. Having a Russian entity with nuclear power access so close to the US would raise questions for the US government.

China has been slowly attempting to devalue the dollar by having Brazil and India trade in their native currencies, cutting the dollar out as an intermediary currency. With a BRICS membership, China could try to persuade Mexico to do the same, increasing the value of their own currency while impacting the USD’s economic vitality.

However, the US is Mexico’s largest trade partner, and Mexico would not want to risk ruining that relationship. A BRICS membership could potentially guarantee that the US Congress would be more calculated in their statements against Mexico, especially any statements that suggest invasion to dismantle the cartels. A US invasion would harm Mexico’s economy, which would subsequently impact China and Russia. Joining BRICS would provide an extra layer of security for Mexico to ensure the US treats it respectfully, as long as the US does not immediately feel that such an alliance poses an immediate threat to national security.

Source: Strike Source

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Shifting Alliances: The Potential Implications of Mexico Joining BRICS

Steven Alber
Jun 4, 20232 min

Mexico, being one of the 19 nations expressing interest in joining BRICS, stands at the brink of a decision that could disrupt current geopolitical dynamics and financial frameworks. The potential shift could significantly affect Mexico’s relations with its close neighbors, especially the United States and Canada, and indeed, the global economic landscape.

BRICS, an acronym for Brazil, Russia, India, China, and South Africa, could see its alliance extended if Mexico were to officially apply to join. This membership extension could influence the stability of the US dollar’s global status, particularly if Mexico chooses to embrace the forthcoming BRICS currency.

Joining BRICS could provide Mexico with an avenue for closer ties with its member nations, reshaping the contours of power across the globe. The geopolitical dynamics in North and Latin America could be transformed, leading to a potential reconfiguration of alliances and partnerships. This move may impact Mexico’s relationships with countries outside the BRICS alliance significantly.

Moreover, if Mexico, a key player in Latin America, decides to accept the BRICS currency for international trade, it could initiate a domino effect, with other Latin American nations considering severing their financial ties with the US dollar. Such a transition could position the BRICS currency as a strong contender in Latin American markets, challenging the long-standing dependence on the U.S. dollar.

Nonetheless, as of now, Mexico remains closely partnered with the United States and Canada through NAFTA. Its official decision to join BRICS is yet to be made and would mark a significant turn in its international strategy.

The forthcoming BRICS summit, scheduled to be held in South Africa in August, will be a pivotal occasion where the formation of a new currency will be discussed. Should Mexico choose to participate, it could provide a critical entry point for the BRICS currency into the Latin American markets. This move could extend beyond just financial implications, fostering closer diplomatic, security, and cultural ties among the participating nations.

Mexico’s potential integration into BRICS could herald a new era of economic and political realignment, with profound implications for the global order. It would be crucial for all nations to keep a keen eye on these unfolding developments.

Source: Planet Pulsar

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