How will nearshoring impact water?

Published June 28, 2023

It’s hard for me not to be excited about the nearshoring boom that is happening in Mexico.  Significant investments in new facilities and existing plant expansions are pouring in from companies from around the globe – Germany, France, Italy, Spain, Korea, Japan, Taiwan, India, the U.S., Canada and China.

I recently wrote about my perspective on nearshoring through previous experiences with the impact of NAFTA on this economy. Most of the investment is concentrated in Mexico’s northern states, closest to the U.S. border, and others are focused on the central “El Bajío” region. All of these states have something in common, aside from being manufacturing hubs – they have dry climates and are water-stressed regions.

How can such significant investment in industry and manufacturing, along with the massive amounts of new people moving to these areas, not create major water issues? President López Obrador even said Tesla should consider building its new factory not in Monterrey, but in the southern part of the country, “where water is plentiful.”

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