Mexico (Taiwan) fact of the day

In recent months, Mexico has emerged as a crucial player in the global AI boom, contributing 40 percent of US imports of computer servers utilized in data centers that power artificial intelligence. Taiwanese manufacturers have been swiftly expanding their factories in Mexico to assemble these servers, which have now become the country's top export to the US, surpassing automobiles that dominated trade for decades.

Mexico currently ranks as the second-largest provider of enterprise servers to the US, with sales reaching $46.9 billion this year, closely following Taiwan's $53.5 billion, although Mexico holds the title for monthly sales in May. This trend has been instrumental in reviving Mexico's struggling economy, as its exports soared to record highs.

Servers and related hardware accounted for nearly one-fifth of Mexico's $317 billion in goods exports from January to May, a nearly double increase compared to the same period a year earlier. Taiwan has become Mexico's third-largest trading partner, moving up from eighth place in 2022. Taiwanese firms have invested over $1.6 billion since 2020 in Mexican factories, which provide geographical proximity and tariff-free access to US tech giants spending billions on data centers.

Jesse Rogers, head of Latin America economics at Moody's Analytics, emphasized the significance of Mexico in the emerging AI-powered economy, describing it as a "new frontier of collaboration and even dependency on the Mexican economy when it comes to AI servers."