Background on Carlos Salazar Gaytán and ANAPS
Carlos Salazar Gaytán, the president of the National Association of Health Providers (ANAPS), has reported that Mexico’s reliance on medical device exports to the United States has decreased significantly over the past five years. Originally, 94% of these exports were directed to the US; however, this figure has now dropped to 64%.
Reasons for the Shift
Salazar Gaytán clarified that this reduction in dependence is not due to a decline in demand for medical devices but rather because Mexican companies are increasingly exporting their products directly to other countries to avoid tariffs. He emphasized that Mexico’s exports are now primarily directed towards Europe, Canada, and Latin American countries like Brazil.
Export Growth and Market Focus
Mexico’s export value exceeds 22 billion US dollars, with an annual growth rate of 9%. Salazar Gaytán highlighted that Mexico benefits from nearshoring due to its proximity to the US, making it the primary consideration for medical device manufacturers. He also pointed out that setting up a plant in the US is less cost-effective compared to Mexico, where production costs can be up to 35% lower than in China.
Tariff Risks and International Negotiations
Salazar Gaytán mentioned that the US recently informed Mexico that the medical device industry is under review under section 232 of the Trade Expansion Act. This development implies that Mexican exports could face tariffs. He stressed the importance of ensuring that raw materials, plastic components, and electronic components remain tariff-free.
Key Questions and Answers
- What is the main reason for Mexico’s reduced dependence on US medical device exports? The reduction is primarily due to Mexican companies directly exporting their products to other countries to avoid tariffs, not a decline in demand.
- Which markets are now the primary focus for Mexican medical device exports? Mexico is increasingly exporting to Europe, Canada, and Latin American countries like Brazil.
- Why is Mexico a preferred location for medical device manufacturing? Mexico benefits from nearshoring due to its proximity to the US, and production costs are generally lower than in the US or China.
- What tariff-related concerns has ANAPS raised? ANAPS is concerned about potential tariffs on raw materials, plastic components, and electronic components in Mexican exports.
- How is Mexico addressing tariff risks? Mexico is working on ensuring that essential components remain tariff-free and negotiating imposed tariffs with countries like China, Taiwan, and India.
