Ambassador of Australia in Mexico, H.E. Dr. David Engel
What is the current status of the trade relationship between Australia and Mexico?
Mexico is Australia’s largest trading partner in Latin America, with two-way trade valued at more than $3 billion in 2015–16. More than 150 Australian companies operate in Mexico. Australia has just announced a Free Trade Agreement with Mexico through the Pacific Alliance, which will boost our commercial engagement.
Do you expect the current trade ties to grow or decline in the coming years?
We expect trade ties to grow in coming years. As I mentioned, Australia has just announced a Free Trade Agreement with Mexico through the Pacific Alliance, which will help boost our commercial relationship. The Mexican Government is seeking to diversify its export markets. Australia provides a safe, low-risk environment to do business, and is a gateway to the Asia-Pacific region. To that end, Australia’s Tourism, Trade and Investment Minister intends to take a trade delegation to Mexico later in the year to advance the bilateral trade and investment relationship. I hope to see more high-quality Australian products entering the Mexican market.
How important is NAFTA to the continuing economic relationship between the countries? And has the Mexican peso fluctuation have had any effect?
Australia has a Free Trade Agreement with the United States. The United States and Mexican economies are closely linked in turn through NAFTA. Mexico is a world leader in manufacturing and would benefit from Australia’s resources and agricultural products. Further, Australia has a network of free trade agreements in Asia that Mexico could use to diversify its supply chains. The depreciation in the peso at the end of 2016 and early 2017 made Mexican exports to Australia more competitive. Growing Australian investments in Mexico, such as the BHP ‘Trion’ project, demonstrate confidence in the Mexican economy.
What are some areas in which direct investment is happening in both countries?
Australian investment in Mexico has increased from $200 million at the start of decade to more than $6 billion today. Australian investment will further increase with BHP’s partnership with Mexican state oil company PEMEX. BHP’s initial investment is significant and has elevated the profile of Mexico in Australia for other potential investors in a diverse range of sectors. Australian firms are already invested in Mexican roads, telecommunications, energy generation, education, real estate, agriculture, health, mining, manufacturing and the digital economy. Australia also benefits from Mexican investment. For example, the Mexican group Gruma operates a large food production plant in Australia, which supplies Australia and nearby markets in Asia.
The Mexican President Enrique Peña Nieto has visited Australia in an official capacity. What was his reception by both government and Australian public? Was the visit beneficial to the economic ties in any way?
Mexican President Peña Nieto visited Brisbane for the G20 Summit hosted by Australia in 2014. The visit provided an opportunity for Australia and Mexico to strengthen bilateral ties and deepen joint engagement in the G20, in particular, to promote economic growth, and increase employment and economic resilience. A key initiative during Australia’s G20 presidency was the design of growth strategies for each member country. Mexico supported Australia in this initiative and provided examples from Mexico’s own reform initiatives. The Australia-Mexico bilateral agenda has grown significantly since President Peña Nieto’s visit to Australia in 2014, so another visit would be timely and welcome.
What has been your economic goals as ambassador and has Mexico been a receptive country for those goals?
As Mexico looks to forge more diverse economic ties beyond its traditional commercial relationships with the United States and Canada, this is an ideal time for me as Ambassador to pursue a deepening of economic ties between Australia-Mexico. The Australian Government would like to sign a Free Trade Agreement with Mexico and the recent Pacific Alliance announcement will achieve this. Our goal of increasing Australian investment in Mexico is being helped along significantly by BHP‘s investment to explore the ‘Trion’ deep-water oilfields in the Gulf of Mexico. We expect this will pave the way for more Australian investment in other sectors. In the area of agriculture, Mexico can now begin exporting table grapes from the Sonora region. But I am keen to see more progress made in this sector. I also want to encourage more Mexican investment in Australia, whose close economic links to the Asia-Pacific offer opportunities to extend into that market.
Beyond trade, what else connects Australia and Mexico together?
In the news, you do not usually hear the two countries mentioned together. Both our countries appreciate that prosperity flows from open economies and free trade. We share an interest in an effective, rules-based global order. We are committed to global action on climate change and to the Sustainable Development Goals. Innovative responses to humanitarian crises and natural disasters, and to ending gender-based injustice, are priorities for both of our countries. We are united in combating terrorism. We also share an appreciation of culture and artistic expression. The use of art to help exchange traditional knowledge and generate economic opportunities, is common to indigenous communities in both countries. Mexico and Australia have embarked on an exchange of indigenous artistic ideas. Last year the Australian Government supported the visit of Mr Cilau Valadez, a renowned Wixarika yarn painter from the Huichol people, to Australia to undertake an artist residency exchange. An Australian indigenous artist will visit Mexico this year. One of the great pleasures of my position in the Australian Embassy is knowing that we can make a difference to the lives of marginalised communities in this region. Through the Embassy’s Direct Aid Program we provide small grants to non-government organisations who work towards improving the lives of women and girls, people with disabilities, migrants and indigenous people in Mexico and neighbouring countries. In the last year, we directed nearly 8 million pesos to projects.
