As the cost of manufacturing in China continues to rise, companies in the U.S. and abroad are having to rethink their global strategies. As The Wall Street Journal article that ran earlier this year - titled “China’s Export Pain May be Mexico’s Gain” -would indicate, companies that once flocked to China because of its massive pool of cheap labor and attractive government incentives are now finding themselves at risk of losing the advantages that brought them to China in the first place. As a result, manufacturing companies are moving towards near-sourcing  to Mexico.
Now, thanks to a joint venture between two major petrochemical producers in the Americas, Mexico will improve its manufacturing capabilities, boost job creation and become even more attractive for foreign businesses . This partnership between Brazil’s Braskem  S.A. and Mexico’s Grupo Idesa will build a plant in Veracruz, Mexico which will bring high-volume, high-efficiency plastics production to the region. At present, Mexico imports about 70 percent of the total amount of polyethylene use in the country. Once the new polyethylene complex featuring GE hyper compressor technology goes online, Mexico will significantly reduce the amount of polyethylene it imports for manufacturing, packaging and other industrial applications.
"This project is very strategically important for business development in the area, and our expectation is for it to spur long-term growth, so it was imperative for us to be extremely selective with the solutions we chose," said Silvia Pires Migueles, purchasing director for Braskem Idesa. "GE's efficient, reliable compressor technology makes us more competitive from day one, and GE's strong local presence gives us installation, maintenance, service and expansion advantages that will pay dividends for the life of the installation."
"Officials expect the plant's technology to attract new businesses to the region, creating jobs and healthy growth," said Marco Caviola, leader of GE Petrochemicals Solutions for Latin America. "We are committed to supporting that growth long-term by expanding our local maintenance facility and providing operator and maintenance training to Braskem Idesa employees."
Construction of the complex will begin later this year.