The Asia-Pacific, Regionalism and the Global System
Show Less

The Asia-Pacific, Regionalism and the Global System

Edited by Christopher M. Dent and Jörn Dosch

The expert contributors shed critical light on how significant developments are impacting on the global system. In particular, they consider emerging forms of global governance, and how the Asia-Pacific as a region, individual countries such as China, Japan, South Korea and the US, and regional organisations and forums like APEC are shaping the world. Uniquely, the discussion is not limited to East Asia but also takes Latin America prominently into the equation.
Buy Book in Print
Show Summary Details

Chapter 2: Is Japanese Foreign Direct Investment Fostering Production Networks in Mexico?

Melba Falck Reyes

Extract

2. Is Japanese foreign direct investment fostering production networks in Mexico? Melba Falck Reyes1 INTRODUCTION 1. In 2005, Mexico and Japan signed an Economic Partnership Agreement (EPA) that constituted for both countries their first trans-Pacific bilateral trade agreement. With the EPA both countries looked to increase their global competitiveness that had been lost in the past decades. Mexico’s main objective was to attract more foreign direct investment (FDI) from Japan and to have a better market access in some specific sectors. For Japan, the aim was to recover the privileged position that the Japanese firms had lost in 2001, when a special clause inserted in the North American Free Trade Agreement (NAFTA) eliminated free imports of parts and components outside the NAFTA region. Japanese FDI had a long tradition in Mexico, attracted since the 1960s by the then newly established maquiladora system. As some authors have pointed out, this was maybe the first example of regional production-sharing where parts and components were assembled in Mexico and then sent back, as finished products, to the United States. Nonetheless, it was when NAFTA came into being in 1994 that more Japanese firms were interested in locating their production plants in Mexico. Nowadays, with the development of advanced telecommunications and transport systems, the globalization of corporate activities has become increasingly developed. Technology and FDI have played an important role in the ‘fragmentation’ of production processes. Today, transnational firms are involved in more sophisticated schemes than the maquiladora arrangements on the Mexico–US border,...

You are not authenticated to view the full text of this chapter or article.

Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.

Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.

Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.


Further information

or login to access all content.