Introduction
The Asian Dragon, China, has a profound and dangerous presence in Mexico, ranging from trade imbalances to the trafficking of precursors needed for producing fentanyl sold in the United States. This article explores China’s involvement in Mexico, focusing on money laundering, fentanyl production, technology, and espionage.
China and Money Laundering in Mexico
According to a U.S. Treasury Department report, Chinese money laundering networks were involved in handling $312 billion between 2020 and 2024. Andrea Gacki, Director of the U.S. Financial Crimes Enforcement Network (FinCEN), stated that these networks launder funds for Mexican drug cartels and participate in significant illicit money trafficking networks within the U.S. and globally.
China’s Connection to Fentanyl
In July, Zhi Dong Zhang, a Chinese national allegedly linked to the Sinaloa and Jalisco New Generation Cartels, mysteriously fled just one day before his extradition request to the U.S. Zhi, known as Brother Wang, was a key intermediary in distributing chemicals for fentanyl and methamphetamine production, operating in the U.S., Latin America, China, and Japan.
China, Technology, and Espionage
Huawei, a telecommunications company banned in the U.S. and several European countries for alleged military espionage connections, continues to operate in Mexico. This and other companies have a strong presence in critical infrastructure such as ports, airports, and other systems.
The U.S. has waged a campaign against Huawei due to espionage and disruption risks. As a result, Panama has replaced many of its telecommunications equipment with U.S. technology, and Spain recently canceled a multimillion-dollar contract involving Huawei due to concerns in Washington and Brussels.
Satellite Technology Cooperation
Another issue straining the Mexico-U.S. relationship is cooperation in satellite technology with China. Recently, CAS Space launched a rocket placing Mexican-built ThumbSat satellites into orbit.
For China, the space sector is not merely a matter of symbolism and soft power. It’s a strategic security area and military competition with the U.S. Despite China’s claims of peaceful and technological purposes, its government scheme allows for civil-military fusion, making all technology dual-use with potentially dangerous implications.
Trade Imbalance and Espionage
Between January and June of this year, Mexico exported $4.592 billion to China while China sold $62.127 billion worth of goods to Mexico. This imbalanced and disadvantageous situation for Mexico also harms its commercial relationship with its North American neighbor.
Key Questions and Answers
- Who is China in the context of Mexico? China’s presence in Mexico extends from trade imbalances and money laundering to fentanyl production, technology, and espionage.
- What is China’s role in Mexican money laundering? Chinese money laundering networks are involved in handling billions of dollars for Mexican drug cartels and participate in global illicit money trafficking networks.
- How is China connected to fentanyl production in Mexico? Chinese nationals like Zhi Dong Zhang have been linked to Mexican drug cartels, distributing chemicals for fentanyl and methamphetamine production across multiple countries.
- What are the concerns regarding Chinese technology in Mexico? Huawei and other Chinese companies have a strong presence in critical infrastructure, raising espionage concerns. The U.S. has banned Huawei due to these risks, prompting countries like Panama and Spain to replace Chinese technology with U.S. alternatives.
- Why is satellite cooperation with China a concern? Satellite technology collaboration with China, such as the ThumbSat satellites launched by CAS Space, raises security concerns as it’s viewed as a strategic area of competition with the U.S.
- What are the implications of the trade imbalance between Mexico and China? The significant trade deficit harms Mexico’s economy and its commercial relationship with the U.S.
