Trump administration policies will create new challenges for nearshoring manufacturing closer to the United States, but a reversal that substantially damages major manufacturing countries' attractiveness for nearshoring is unlikely. In 2023, Mexico surpassed China as the top exporter to the United States for the first time in decades, a position Mexico held for the second year in a row in 2024. Canada, for its part, is the largest recipient of U.S. exports (though China exports a larger amount to the United States), illustrating the deep interconnectivity of North American supply chains and, amid broader shifts in global trade, pointing to an ongoing uptick in manufacturing in parts of the Western Hemisphere to supply the U.S. market. Nonetheless, U.S. President Donald Trump's tariffs on Canada and Mexico, even if narrowed compared to their original imposition, are generating growing uncertainty about the attractiveness of these and other regional countries for nearshoring, especially...
