This Time It’s Official: Mexico Is Going to the BRICS Summit

It’s not just Mexico’s government that is calling for economic diversification away from the US; so, too, is its biggest business lobby.

Until recently, the accepted wisdom in Mexico was that Mexico’s economy is simply too integrated with the US and Canada’s and too dependent on the US for it to be able to join the BRICS. Economically speaking, it seemed to make little sense: Mexico shares with the US the world’s largest trade partnership as well as a significant trade surplus whereas with China it has a significant — and growing — deficit.

For years rumours have abounded, sometimes even from credible sources, that Mexico was on the brink of joining the BRICS. In the lead-up to the 15th meeting of the BRICS summit in Johannesburg in August 2023, South Africa’s Foreign Minister Naledi Pandor claimed that Mexico was among more than a dozen countries that had applied to join the alliance.

Mexico has formally applied for BRICS membership along with about 12 other countries such as Saudi Arabia, UAE, Nigeria etc.

Foreign Minister, Naledi Pandor, from South Africa — which holds BRICS presidency this year — on BRICS expansion: pic.twitter.com/SMXF49Xw1T

— S.L. Kanthan (@Kanthan2030) March 28, 2023

Mexico’s flag was even among the 14 featured on the purely symbolic BRICS banknote Vladymir Putin flashed for the cameras at the 16th BRICS summit in Kazan last year (it’s the one in the middle of the far-right column). As we noted at the time, the stunt probably amounted to little more than expert trolling from Putin. Russian Embassy spokesman Andrei Zemskiy recently acknowledged that the USMCA makes it much more difficult for Mexico to join the BRICS.

Each time the rumours reached fever pitch, the Mexican government batted them down. President Andres Manuel López Obrador (aka AMLO) reiterated time and again that Mexico’s goal is to strengthen North American trade and cooperation. Mexico’s geographic reality, he said, left it little choice but to pursue further economic integration with the US and Canada:

We cannot shut ourselves off, we cannot break up, we cannot isolate ourselves. It is a fact that we have 3,800 kilometres of border, for reasons of geopolitics (presumably in reference to the US’ invasion, occupation and appropriation of more than half of Mexico’s territory in the mid-19th century). With all due respect, we are not a European country, nor are we Brazil. We have this neighbourhood and, furthermore, if we agree on things, as we have done, we can help each other out… Our economic integration is already well advanced.

But as we noted last week, if anyone is able to change this dynamic, it is Trump 2.0:

…either through its constant bullying or its wilful destruction of the USMCA, a trade deal that Trump himself brokered and which Trump himself called the “best trade deal ever” just five years ago.

Over the past week, Washington has declared Mexico a foreign “adversary” together with the likes of Iran, Russia and China. It has also imposed potentially ruinous sanctions against two Mexican banks and a brokerage house for allegedly laundering money for drug cartels without presenting any clear evidence. As is becoming increasingly clear, the move was essentially a shakedown by the Trump admin aimed at getting greater control over Mexico’s banking system as well as its relationship with China.

Lo and behold, one week later President Sheinbaum just announced that her government will be participating as an observer in the 17th annual meeting of the BRICS summit in Rio de Janeiro on July 6-7. Sheinbaum herself will not be part of the delegation since her government, she says, has enough on its plate at home. Instead, Mexico will be represented by its Foreign Minister Ramon de la Fuente.

It could be argued that this is part of a process that already began with AMLO’s election in 2018. Unlike many of his direct predecessors, AMLO was keen to reengage with Latin America and the Global South as a whole, even going so far as to rejoin the G77+China in 2023.

This is historic. At the UN, Mexico 🇲🇽 stated clearly: "Mexico belongs to the Global South, indeed, through history and conviction".

It called to "strengthen the negotiating position of the Global South", and announced it is rejoining the G77+China.

Mexico left the G77 in 1994,… pic.twitter.com/TcvM7bjrmh

— Ben Norton (@BenjaminNorton) September 28, 2023

The BRICS association currently comprises ten countries – Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran and the United Arab Emirates. In October 2024, an additional 13 countries (Algeria, Belarus, Bolivia, Cuba, Indonesia, Kazakhstan, Malaysia, Nigeria, Thailand, Turkey, Uganda, Uzbekistan and Vietnam) were invited to participate as “partner countries”, allowing them to engage with and benefit from BRICS initiatives.

It’s worth stressing that Mexico is going as an observer country, which is the first of many steps towards becoming a member. It is not officially a member of the group and cannot participate in any of the internal decisions taken at the Summit. But it can give its opinion and collaborate in joint projects, especially in areas of economics and development. More importantly, it will be able to put out feelers to see what kinds of models of future collaboration may be on offer.

At the same time, the Sheinbaum government is intensifying efforts to diversify Mexico’s economic and trade relations away from the US. That includes a possible deepening of its trade ties with Brazil. In August, a key meeting is scheduled to take place between the two countries’ secretaries of Commerce and Foreign Affairs to discuss ways of expanding trade. Brazilian companies will also be in attendance and meeting with Mexican businessmen to see how the economies can complement each other.

“We can supply what Brazil doesn’t have and they can supply what Brazil has that we don’t, not only in terms of the trade agreement but also in terms of investments,” Sheinbaum said.

Together, Brazil and Mexico represent 65% of the GDP of Latin America and the Caribbean.  Trade between the two countries has already grown by over a third in the past six years, from $10 billion in 2019, to more than $13.5 billion in 2024, according to Rodrigo Almeida, head of the Commercial Sector of the Brazilian Embassy in Mexico. That is despite the very limited trade agreement currently in place between the two countries.

As the FT points out, $13.5 billion is still a tiny fraction of the $840bn of goods traded between the US and Mexico last year — and the $161.8bn in 2024 exchanged between Brazil and China in 2024. But there is also room for continued growth:

For Mexico, which is gearing up for a tense renegotiation of its USMCA deal with the US and Canada, Brazil could offer investment opportunities in sectors such as aerospace and pharmaceuticals, while helping ease its dependence on the US for imports of grains including yellow corn. Brazilian officials say its industrial and agribusiness sectors are interested in increasing exports to Mexico.

A major milestone came just over a year ago when the Mexican Mexicana de Aviación purchased 20 aircraft from the Brazilian company Embraer.

At the same time, Mexico is also looking to expand its bilateral trade with India, the EU and the United Arab Emirates. In her meeting last week with Indian Prime Minister Narendra Modi on the side lines of the G7, Sheinbaum discussed areas of opportunity, particularly regarding critical materials.

“We are very interested in the link with the pharmaceutical industry in India, but that it is invested in Mexico,” Sheinbaum said. “This year we are going to have a very important meeting about it.”

Even Mexican Businesses Are Looking Beyond US

It’s not just Mexico’s government that is talking in earnest about diversifying Mexico’s economic and trade relations away from the US; so, too, is its biggest business lobby. The Employers’ Confederation of the Mexican Republic, or Coparmex, warned that the fallout from the US’ dramatic shift towards protectionism leaves Mexico little choice but to shift its trade policy towards closer ties with Asia, Africa and Latin America.

Edmundo Enciso, president of the Nearshoring and Foreign Trade Commission of Coparmex Mexico City, told El Economista that the tariffs imposed by the Trump administration on steel, the automotive sector and agricultural products are already generating devastating effects on value chains throughout North America. This, together with Trump’s crackdown on migration, the mass deportation of Mexican workers and his new tax on remittance payments, is destabilising entire communities in Mexico and destroying local employment.

“Mexico has a historic opportunity to diversify its alliances, and that does not mean breaking with the United States but rather rebalancing our relationship and developing an autonomous foreign policy, which puts Mexico’s interests at the centre,” said Enciso.

The fact that big business lobbies like Coparmex, which represent the interests of arguably the biggest beneficiaries of Mexico’s decades-long trade liberalisation with the US, are now calling for greater trade diversification hint at the scale of the damage Trump 2.0 has already inflicted on US-Mexico relations in its first five months in power.

As the economist Mario Campa notes, Mexico has few cards up its sleeve in its historically unbalanced relationship with the United States. But one of them is to pursue alternative trade partnerships and allegiances in this emerging era of multipolarity. Mexico’s gateway to the BRICS may end up being Brazil, Campa adds, which would be ironic given it was Brazil that slammed the door shut on Venezuela last year (machine translated):

According to figures from the Observatory of Economic Complexity (up to and including 2023), Brazil was the seventh biggest destination for Mexican exports and Mexico the sixth for Brazilian sales abroad. If a treaty is signed, the likely moderate expansion of the trade deficit of Mexican agriculture could be justified with the diversification of markets and the strategic fight against inflation. Strengthening ties with the South American giant would be a geo-economic key into the Mercosur trade bloc.

It would also be an indirect way of strengthening Mexico’s ties with the BRICS without going all in, with all the risks that would entail. But as Campa says, there is a certain sense of urgency:

Building bridges with the BRICS hand in hand with Brazil is today a complementary negotiation card and tomorrow a diversifying and solidarity commitment with the Global South. Mexico must take advantage of it today. Tomorrow, it could wake up and Lula will no longer be there.

The Ukrainization of Mexico?

The renowned Mexican-Lebanese geopolitical analyst Alfredo Jalife says that membership of BRICS would clearly be beneficial for Mexico, though its economy and development are currently chained to the US. He pointed out that there are more than 30 countries, some of them from Latin America, seeking to join the club, and that Mexico would almost certainly be granted membership, given its economic and geopolitical importance.

Perhaps unsurprisingly, Russia’s ambassador to Mexico, Nikolay Sofinskiy, has already stated that Russia would welcome Mexico into the fold. But there’s one problem, says Jalife — the West, in particular the US, “won’t allow it”:

The USMCA deal includes an article, 32.10, that lays out the potential consequences of negotiating an FTA with “nonmarket economies” – which is basically a code word for China. Put simply, if either Canada or Mexico were to negotiate a trade agreement with China, they would have to inform the US three months prior. If a bilateral FTA gets signed with China, any of the three trade partners could walk away from the USMCA with just six months’ notice.

An even greater risk highlighted by Jalife is what he calls the “Ukrainization of Mexico”. In short, Mexico is as strategically valuable to the US as Ukraine is to Russia. And just like Russia will never let Ukraine join NATO, a military alliance, the US will never let Mexico join BRICS, which obviously is not a military alliance (h/t jobs).

Asked in a televised interview whether the US would go so far as to intervene militarily in Mexico, Jalife said:

Why not? It’s already happened 13 times. Go visit the Museum of Interventions in Churubusco, Mexico City, to see how many times they have invaded us… Republican party figures like Trump and Raymond Barr have already talked about intervening in Mexico in a similar way to Pakistan-Afghanistan.

It is precisely for this reason that Mexico’s Sheinbaum government will have to tread very carefully in its attempts to diversify Mexico’s economy away from the US, especially with regard to its ties to China. But whether this is ultimately a bluff or not, the mere fact that Mexico is willing to participate in a BRICS forum for the first time ever reflects just how high the stakes have grown in its relations with the US.