You know what else affects the American middle class? Higher prices on things we buy from other countries, including China. I don’t care if you care about Chinese citizens. But this won’t help them, and it’s not helping us either.
Economics Thread
- Thread starter sturg33
- Start date
You know what else affects the American middle class? Higher prices on things we buy from other countries, including China. I don’t care if you care about Chinese citizens. But this won’t help them, and it’s not helping us either.
Is a fraction of a sky high estimated increase still an increase brought on directly by the Trump Administration?
acesfull86
Well-known member
The man who touts a reason article bot realizing China dumps their aluminum in Canada.
Uninformed idealogues
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sturg33
I
To be fair it's nearly impossible to shock you. But I'm gonna try one day with a really shocking take
Well stupid uninformed positions on economic matters certainly don’t shock me anymore.
sturg33
I
It's a tremendous advantage in an argument to be allowed to dismiss all data and evidence that don't support your views and simply declare a magical future that do support your views as the reality today
Certainly great to tout the bad tariff people act like the contracts signed are between American business men and native Canadians industry while being completely unaware of china’s dumping.
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Grok is a tremendous tool
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Yes, it’s reasonable to conclude that China is growing its influence in the manufacturing operations of both Canada and Mexico, based on the data and trends we’ve discussed. Let’s break it down for each country and then tie it together.
Canada
For Canada, China’s role in aluminum manufacturing inputs is significant and appears to be expanding. In 2023, China supplied 14.5% of Canada’s bauxite and alumina imports (US$334 million out of US$2.3 billion), ranking it third behind the U.S. and Brazil. While this is a snapshot, China’s broader influence in global aluminum markets is growing—its production capacity for alumina and primary aluminum far exceeds any other country’s, and its exports of aluminum products (including semi-finished goods) to Canada rose to US$1 billion in 2023, or 19.6% of Canada’s total aluminum imports. This suggests China is not just a raw material supplier but also a key player in downstream products that feed into Canadian manufacturing.
Beyond direct imports, China’s influence is amplified by its dominance in global supply chains. For instance, even bauxite or alumina routed through the U.S. (43.5% of Canada’s imports) may originate from Chinese-controlled mines or refineries elsewhere. Additionally, Canada’s reliance on imported inputs for its aluminum smelters—coupled with China’s low-cost production and increasing export focus—points to a growing dependency. While Canada’s domestic aluminum production remains strong (3.3 million tonnes in 2023), the lack of local bauxite and limited refining capacity mean China’s role as a supplier is likely to increase, especially if global prices or trade policies shift further in China’s favor.
Mexico
Mexico offers a clearer picture of expanding Chinese influence. China supplied 25-30% of Mexico’s manufacturing inputs in 2023 (US$48.9 billion to US$57 billion out of an estimated US$180-216 billion), a substantial share driven by intermediate goods like electronics and automotive components. This is up from earlier years—China’s exports to Mexico grew from US$52 billion in 2018 to US$81.46 billion in 2023, a 57% increase over five years, with a notable 60% spike in shipping volume in January 2024 alone. This growth reflects both increased demand for Chinese inputs and a strategic shift: Chinese firms are investing in Mexico to leverage its proximity to the U.S. under the USMCA, avoiding tariffs imposed during the U.S.-China trade war.
Chinese FDI in Mexico, though still small relative to the U.S. (0.5-1% of total manufacturing ownership), is concentrated in manufacturing and rising—US$282 million in 2023, with cumulative investment likely exceeding US$2 billion by 2025. Projects like the Hofusan Industrial Park and BYD’s planned electric vehicle plant signal a long-term play to embed Chinese operations in Mexico’s manufacturing ecosystem. This dual approach—supplying inputs and establishing production—enhances China’s influence beyond mere trade.
Comparative Trends and Influence
For both countries, China’s influence is growing through distinct but complementary channels:
Trade Dependency: Canada’s 14.5% share of aluminum inputs from China and Mexico’s 25-30% share of total manufacturing inputs show China as a critical supplier. These percentages are trending upward, with Mexico’s faster growth tied to nearshoring and Canada’s tied to global commodity dynamics.
Investment: Mexico sees more direct Chinese ownership (albeit still a small fraction), while Canada’s exposure is more indirect, via supply chains. However, both reflect China capitalizing on North American manufacturing needs.
Strategic Positioning: China’s push into Mexico aligns with bypassing U.S. trade barriers, while its role in Canada leverages its dominance in raw materials like bauxite and alumina, where alternatives are limited.
Quantitatively, Mexico’s reliance on Chinese inputs (25-30%) is higher than Canada’s (14.5% for aluminum inputs, less if averaged across all manufacturing), but both show increases over time. Qualitatively, China’s influence is amplified by its control of upstream resources (e.g., rare earths, metals) and its ability to offer low-cost goods, making it harder for either country to diversify away quickly.
Conclusion
Yes, it’s safe to say China is growing its influence in Canada’s and Mexico’s manufacturing operations. In Canada, this manifests as a deepening reliance on Chinese aluminum inputs, likely to rise as global supply chains evolve. In Mexico, it’s more pronounced, with both input supply and direct investment expanding rapidly, driven by nearshoring and trade realignment. While the U.S. remains the dominant partner for both, China’s strategic inroads—through trade, investment, and supply chain leverage—point to a sustained increase in its manufacturing footprint in North America as of early 2025. If these trends persist, China’s influence could shift from supplementary to indispensable in key sectors over the next decade.
_____________
Yes, it’s reasonable to conclude that China is growing its influence in the manufacturing operations of both Canada and Mexico, based on the data and trends we’ve discussed. Let’s break it down for each country and then tie it together.
Canada
For Canada, China’s role in aluminum manufacturing inputs is significant and appears to be expanding. In 2023, China supplied 14.5% of Canada’s bauxite and alumina imports (US$334 million out of US$2.3 billion), ranking it third behind the U.S. and Brazil. While this is a snapshot, China’s broader influence in global aluminum markets is growing—its production capacity for alumina and primary aluminum far exceeds any other country’s, and its exports of aluminum products (including semi-finished goods) to Canada rose to US$1 billion in 2023, or 19.6% of Canada’s total aluminum imports. This suggests China is not just a raw material supplier but also a key player in downstream products that feed into Canadian manufacturing.
Beyond direct imports, China’s influence is amplified by its dominance in global supply chains. For instance, even bauxite or alumina routed through the U.S. (43.5% of Canada’s imports) may originate from Chinese-controlled mines or refineries elsewhere. Additionally, Canada’s reliance on imported inputs for its aluminum smelters—coupled with China’s low-cost production and increasing export focus—points to a growing dependency. While Canada’s domestic aluminum production remains strong (3.3 million tonnes in 2023), the lack of local bauxite and limited refining capacity mean China’s role as a supplier is likely to increase, especially if global prices or trade policies shift further in China’s favor.
Mexico
Mexico offers a clearer picture of expanding Chinese influence. China supplied 25-30% of Mexico’s manufacturing inputs in 2023 (US$48.9 billion to US$57 billion out of an estimated US$180-216 billion), a substantial share driven by intermediate goods like electronics and automotive components. This is up from earlier years—China’s exports to Mexico grew from US$52 billion in 2018 to US$81.46 billion in 2023, a 57% increase over five years, with a notable 60% spike in shipping volume in January 2024 alone. This growth reflects both increased demand for Chinese inputs and a strategic shift: Chinese firms are investing in Mexico to leverage its proximity to the U.S. under the USMCA, avoiding tariffs imposed during the U.S.-China trade war.
Chinese FDI in Mexico, though still small relative to the U.S. (0.5-1% of total manufacturing ownership), is concentrated in manufacturing and rising—US$282 million in 2023, with cumulative investment likely exceeding US$2 billion by 2025. Projects like the Hofusan Industrial Park and BYD’s planned electric vehicle plant signal a long-term play to embed Chinese operations in Mexico’s manufacturing ecosystem. This dual approach—supplying inputs and establishing production—enhances China’s influence beyond mere trade.
Comparative Trends and Influence
For both countries, China’s influence is growing through distinct but complementary channels:
Trade Dependency: Canada’s 14.5% share of aluminum inputs from China and Mexico’s 25-30% share of total manufacturing inputs show China as a critical supplier. These percentages are trending upward, with Mexico’s faster growth tied to nearshoring and Canada’s tied to global commodity dynamics.
Investment: Mexico sees more direct Chinese ownership (albeit still a small fraction), while Canada’s exposure is more indirect, via supply chains. However, both reflect China capitalizing on North American manufacturing needs.
Strategic Positioning: China’s push into Mexico aligns with bypassing U.S. trade barriers, while its role in Canada leverages its dominance in raw materials like bauxite and alumina, where alternatives are limited.
Quantitatively, Mexico’s reliance on Chinese inputs (25-30%) is higher than Canada’s (14.5% for aluminum inputs, less if averaged across all manufacturing), but both show increases over time. Qualitatively, China’s influence is amplified by its control of upstream resources (e.g., rare earths, metals) and its ability to offer low-cost goods, making it harder for either country to diversify away quickly.
Conclusion
Yes, it’s safe to say China is growing its influence in Canada’s and Mexico’s manufacturing operations. In Canada, this manifests as a deepening reliance on Chinese aluminum inputs, likely to rise as global supply chains evolve. In Mexico, it’s more pronounced, with both input supply and direct investment expanding rapidly, driven by nearshoring and trade realignment. While the U.S. remains the dominant partner for both, China’s strategic inroads—through trade, investment, and supply chain leverage—point to a sustained increase in its manufacturing footprint in North America as of early 2025. If these trends persist, China’s influence could shift from supplementary to indispensable in key sectors over the next decade.
sturg33
I
As a very frequent user of Groq... it's opening paragraph tells me you led the witness to find the answer you are looking for
I did have concerns that this is a trend with these tools but figures do seem to back that up which is what I've been conveying to you guys from the beginning.
sturg33
I
Groq is amazing. But I'd bet I can prompt it to tell me the opposite finding.
Regardless, last week you were telling me Canadian tarrifs were about border security of fetenyl. Today's its about hurting China economically
I've actually said both - We want secure borders free of drugs from china and less reliance on China for manufacturing.
I can always go show you those pieces specifically with Mexico.
I’ll proceed with the argument that Canada and Mexico are becoming less reliant on China, focusing on manufacturing inputs and operations, and I’ll base it on plausible trends and data up to March 15, 2025. This will be a counterfactual argument—pushing against the earlier evidence of growing Chinese influence—to explore how such a case could be made.
Argument: Canada and Mexico Are Becoming Less Reliant on China
Canada: Diversifying Aluminum Inputs and Strengthening Regional Ties
Canada could be reducing its reliance on China for manufacturing inputs, particularly in its aluminum sector, through strategic diversification and bolstered North American integration. In 2023, China supplied 14.5% of Canada’s bauxite and alumina imports (US$334 million out of US$2.3 billion), but this share might be shrinking as Canada leans harder into alternative suppliers. The U.S., providing 43.5% of these inputs, and Brazil, at 18.7%, are closer partners under the USMCA framework, which incentivizes regional trade. Canada’s aluminum industry, centered in Quebec and British Columbia, relies on imported bauxite and alumina due to no domestic deposits, but recent investments—like Rio Tinto’s upgrades to its Jonquière refinery—could signal a push to process more regionally sourced bauxite, reducing dependence on Chinese alumina.
Moreover, the Trump administration’s 25% tariffs on Canadian goods (effective early 2025) might paradoxically accelerate this shift. While initially disruptive, these tariffs could pressure Canada to prioritize self-sufficiency or USMCA-aligned supply chains over cheaper Chinese imports. If Canada increases domestic alumina output or secures more from Brazil or Australia (6.6% of imports), China’s 14.5% share could dip below 10% by 2026. Web reports from 2024 also hint at Canada exploring Greenland and Guinea for bauxite, diversifying away from China’s commodity dominance. This aligns with a broader “friend-shoring” trend, where Canada might favor politically stable partners over China amid global tensions, suggesting a gradual decoupling from Chinese inputs.
Mexico: Nearshoring and USMCA-Driven Reorientation
Mexico could similarly be lessening its reliance on China, particularly in manufacturing inputs, as nearshoring and USMCA dynamics take hold. In 2023, China supplied 25-30% of Mexico’s manufacturing inputs (US$48.9-57 billion out of US$180-216 billion), but this could be declining as U.S. and regional suppliers reclaim ground. The USMCA’s rules of origin—requiring 75% North American content for tariff-free automotive exports—push Mexican manufacturers to source more from the U.S. (40-50% of inputs) or domestically, rather than China. Trade data shows U.S. exports to Mexico grew to US$243 billion in 2023, dwarfing China’s US$81.46 billion, and this gap might widen as tariffs disrupt cross-border flows less with the U.S. than with distant China.
Nearshoring also supports this argument. While Chinese firms like BYD are investing in Mexico, U.S. and European companies—like Tesla and Volkswagen—are expanding there too, often bringing their own supply chains. A 2024 Dallas Fed report noted Mexico’s manufacturing FDI hit US$36.1 billion in 2023, with over 60% from the U.S., reducing the relative weight of Chinese inputs. If Mexico’s domestic production of components (e.g., steel or electronics) rises—spurred by these investments—its reliance on China’s 25-30% could drop closer to 20% by 2025. The 25% tariff on Mexican goods entering the U.S. might further incentivize local sourcing to avoid costlier imports from China, reinforcing this trend.
Broader Trends Supporting Reduced Reliance
Both countries could be riding a wave of global supply chain shifts away from China, accelerated by post-COVID resilience concerns and U.S.-led decoupling efforts. Canada’s aluminum sector and Mexico’s broader manufacturing benefit from abundant North American energy (e.g., Canadian hydropower, Mexican natural gas), reducing the need for China’s energy-intensive exports. X posts from late 2024 suggest growing skepticism of Chinese supply chains, with calls for “Made in North America” alternatives gaining traction. If Canada and Mexico boost trade with each other—aluminum from Canada to Mexico’s auto plants, for instance—China’s role as a middleman could shrink.
Additionally, technological advancements might lessen dependence. Canada’s adoption of greener smelting tech (e.g., Elysis, a zero-carbon process) could prioritize local inputs over Chinese ones, while Mexico’s investments in automation might favor U.S.-made machinery over Chinese equivalents. These shifts, though nascent, could compound over time, nudging both nations away from China.
Counterpoints and Conclusion
This argument isn’t without holes. China’s cost advantages, massive production capacity, and entrenched supply chain role—14.5% of Canada’s aluminum inputs and 25-30% of Mexico’s manufacturing inputs—suggest resilience, not retreat. Trade data through 2023 shows growth, not decline, in Chinese influence, and Mexico’s nearshoring partly involves Chinese firms relocating, not exiting. Tariffs might even make Chinese goods more competitive if U.S.-Canada-Mexico trade falters.
Still, a case can be made that Canada and Mexico are becoming less reliant on China if we emphasize regional diversification, USMCA incentives, and emerging self-sufficiency efforts. It’s a stretch based on current trajectories—China’s influence has been growing, not shrinking—but plausible if policy, investment, and trade shifts align to favor North American or alternative sources over the next few years. By 2025, we might see early signs of this, even if China remains a major player.
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Seems like this counterpoint is primarily supported by the Trump admins actions. Almost as if the argument 'Trump doesn't know what he is doing' holds no water.....
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acesfull86
Well-known member
Q What’s the economic consensus of trump’s tariffs in his first term?
A The economic consensus leans toward the view that Trump’s first-term tariffs were costly for consumers, failed to significantly reshape trade balances or manufacturing, and triggered inefficiencies through retaliation and subsidies.
Q How much does Covid impact the anaysis
A COVID doesn’t invalidate the pre-2020 consensus that Trump’s tariffs were costly and underdelivered on key goals
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Grok out here sounding like an uninformed ideologue. Maybe can get a job at Reason.
A The economic consensus leans toward the view that Trump’s first-term tariffs were costly for consumers, failed to significantly reshape trade balances or manufacturing, and triggered inefficiencies through retaliation and subsidies.
Q How much does Covid impact the anaysis
A COVID doesn’t invalidate the pre-2020 consensus that Trump’s tariffs were costly and underdelivered on key goals
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Grok out here sounding like an uninformed ideologue. Maybe can get a job at Reason.
Your question is about the consensus - I have no doubt the consensus is that tariffs equals bad. Most 'experts' are on the payrolls of the think tanks that are supported by this system.
Meanwhile, Trumps actions will lead America into a period of prosperity permanently stifling the thoughts of the 'consensus'.