The border with Mexico is one of America’s most important economic corridors. Nearly $2 billion in bilateral trade takes place across it every day, facilitated by one of the world’s most important free trade agreements, making Mexico the US’s second largest trading partner.
That’s why, given these close ties, US officials were surprised to learn this year that Mexico is considering buying Chinese scanning equipment for its border checkpoints. The revelation was intriguing because the potential seller has documented ties to the Chinese Communist Party (CCP) and the People’s Liberation Army (PLA), potentially giving Beijing access to data on goods entering the United States. This is one of several notable examples of the People’s Republic of China expanding its activities in Mexico.
Not all interactions between Mexico and China threaten US national security. After all, the latter remains America’s third largest trading partner. But cooperation or interference in sensitive sectors of the economy could undermine US interests. To address this issue, US leaders should make it clear to their Mexican counterparts that significant Chinese activities on the border, in telecommunications and in other areas linked to US national security are obstacles to continued cooperation with the United States states would create. Consequently, US aid, financing and trade initiatives with Mexico should also focus on these areas and offer viable alternatives supported by Washington or other friendly partners.
American leaders have long been concerned that opponents are using Mexico as a platform to threaten US security. During the Cold War, the KGB’s Mexico City Station was a key center for Soviet espionage operations against the United States, focused on stealing advanced technology. In the current geopolitical environment, Mexico’s economic importance and proximity to the United States make the country a tempting target for US adversaries.
Over the past decade, China has expanded its presence in Mexico. From 2013 to 2019, total trade between the two countries grew 32 percent, outpacing growth in total trade with Mexico and trade with the United States. In 2020, two Chinese state-owned companies – China Communications Construction Corporation (CCCC) and CRRC Group – were awarded contracts totaling $2.7 billion for major Mexican infrastructure projects, including parts of President Andrés Manuel López Obrador’s Maya train and the modernization of Metro Line 1 in Mexico City. However, both companies have faced US sanctions for their ties to the PLA and, in the case of CCCC, for their involvement in China’s illegal island construction in the South China Sea. While these projects do not pose an immediate security threat to the United States, they are a sign of China’s increasing influence in Mexico, a long-term challenge to US interests.
A more pressing concern, however, is Huawei’s success in Mexico. Since 2011, the Shenzhen-based telecoms giant has secured at least four key contacts with Mexican wireless carriers. The company claimed in 2019 that it powers more than half of the 4G network hardware in the country. In 2017, Huawei was awarded the contract to supply equipment for most of Mexico’s new nationwide wholesale wireless communications network, which could serve as the primary vehicle for future 5G rollout in Mexico, despite problems with the project. The company has also partnered with the Mexican government to build more than 30,000 public WiFi hotspots across the country.
Huawei’s expansive presence in Mexico creates significant long-term security risks for US cooperation and commercial activities. The US government has warned for years about the security risks Huawei networks pose to cooperation with allied governments and US companies’ operations abroad, due to Huawei’s documented ties to the PLA and China’s security services. Huawei is also subject to China’s cybersecurity law, which obliges tech companies to support state security organs. When a company with such close ties to Beijing controls large parts of Mexico’s digital infrastructure, it could become increasingly difficult to maintain security and economic cooperation between the US and Mexico unless guard rails are put in place to protect data flows and intellectual property.
The United States faces several major challenges in Mexico. As US leaders work to address the border crisis, trade disputes and other issues in the bilateral relationship, they must not lose sight of Mexico’s strategic importance. US policies and priorities regarding Mexico must take China’s growing presence into account, providing the Mexican government with red lines in sensitive sectors and offering viable alternatives to Beijing-backed projects and technologies. Mexico remains a key economic and security partner for the United States, and it cannot become a vector for adversaries who undermine America’s security so close to home.
Connor Pfeiffer is Executive Director of the Forum for American Leadership and former National Security Advisor to a member of the US House of Representatives Committee on Appropriations and the Permanent Select Committee on Intelligence. His Twitter handle is @ConnorPfeiffer.
The views expressed in this article are the author’s own.