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Energy politics overshadow Mexico’s bid to join US semiconductor rush By Reuters

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© Reuters. FILE PHOTO: Semiconductor chips are seen on a computer’s circuit board in this pictogram taken February 25, 2022. REUTERS/Florence Lu/Illustration

By Dave Graham

MEXICO CITY (Reuters) – Mexico’s hopes of reaping an investment windfall from a U.S. campaign to raise the stakes in North American semiconductor production have been hampered by concerns about energy supplies, overreliance on fossil fuels and a lack of fiscal incentives.

US Commerce Secretary Gina Raimundo said in September that a $52.7 billion bill known as the chip bill would also create “significant opportunities” for Mexico in its energy- and water-intensive semiconductor industry.

But according to interviews with more than a dozen people familiar with the investment discussions, if Mexico doesn’t move quickly to improve transmission networks and access to renewable energy, as well as craft competitive incentives, it could lose out.

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The United States is building huge factories that make high-tech chips, the most expensive part of the semiconductor business. Meanwhile, Mexico has its sights set on the more accessible parts of the supply chain like design, packaging and testing.

To create those jobs, the country must allay business concerns about electricity supply sparked by President Andrés Manuel López Obrador’s campaign to give market control to Mexico’s cash-strapped national energy companies reliant on fossil fuels.

His pursuit of “energy sovereignty” by helping federal utility de Electricidad and state oil company Petroleos Mexicanos with curbs on privately funded renewable production has bedeviled manufacturers trying to lower their carbon footprint.

“Mexico’s current energy policy severely undermines the country’s ability to attract new investment, especially when it comes to strategic sectors such as the semiconductor industry,” said Neil Herrington, senior vice president for the Americas at the US Chamber of Commerce.

Lopez Obrador’s office did not respond to requests for comment for this story.

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Semiconductors are used in industries from telecoms, defense and automobile manufacturing to computing, and made headlines during the COVID-19 pandemic when supplies dried up, causing serious production bottlenecks in global manufacturing.

Unlike the United States, Mexico has not yet determined what incentives it will offer companies to help North America reduce dependence on semiconductor hubs such as Taiwan in light of long-standing uncertainty in US-China relations.

“The government has done almost nothing to attract investment and incentives,” said Roberto Archedera, economy minister for the western opposition-run state of Jalisco, whose capital, Guadalajara, is known as Mexico’s Silicon Valley.

López Obrador, a left-nationalist on resources, says conditions for investors are “unbeatable,” and notes that foreign direct investment is heading for its best year in nearly a decade.

Official data shows that total fixed investment is still 11% lower than when he was elected in mid-2018.

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Officials, executives and lawmakers say that without a better power grid, the Mexican semiconductor industry will suffer. US Energy Secretary Jennifer Granholm had already warned in January that Mexico’s treatment of energy companies could stifle growth.

“You can’t do things like that if you want to be a team player,” said Henry Cuellar, the Democratic congressman who chairs the US-Mexico parliamentary group. “Especially being part of the North American supply chain. It’s all tied together.”

Mexico has pledged to introduce incentives to get closer by the end of February, and Economy Minister Raquel Buenrostro said last week that a planned trade corridor in southern Mexico could become a hub for investment in semiconductors.

States like Jalisco are home to pioneers Intel Corp (NASDAQ:) facility offers its own incentives such as tax breaks and cheap land, Minister Arechederra said.

Much of the impetus for semiconductor collaboration originated in Mexico, executives say.

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In June 2021, he told Reuters, Carlos Salazar, then head of the Mexican Business Coordinating Council, pitched the idea to US commerce chief Raimundo on a visit to Washington.

Pledges to bolster supply chains followed, and in August 2022 Mexico held a conference targeting investment in semiconductors with companies including Intel and Skyworks Solutions (NASDAQ: Inc), a major employer in the border city of Mexicali.

Josep Mars, Skyworks’ vice president of operations in Mexico, urged the country to seize the opportunity presented.

This means Mexico needs to continue investing in energy and water infrastructure and to do so sustainably, he told Reuters, citing customer pledges to help tackle global warming.

While industry giants like Taiwan Semiconductor Manufacturing Co Ltd and Intel have announced billions of dollars in investments on the US side of the border, Mexico has yet to reveal major projects that could supply those factories.

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“The United States thinks regionally, and Mexico still thinks as one country,” said Luis Manuel Hernandez, president of Mexican manufacturing group Index. “If we want to be at a big table, we need to make different decisions.”

golden age?

In July, tensions over energy turned into a formal dispute with the United States and Canada, which argue Mexico discriminates against their companies.

Mexico’s government said on Monday it wanted to resolve the row to give companies the confidence to invest in the country.

In the past, Lopez Obrador says, corrupt governments have rigged the energy market to favor private interests at the expense of the state.

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In Jalisco, the national energy policy has halted seven private renewable energy projects — five solar and two wind projects — involving a total investment of $1.1 billion, according to figures from the state energy agency.

Companies take special note in the auto industry.

Julian Ives of CW Bearing, a Chinese-owned auto supplier in central Mexico, said companies want to take advantage of the country’s location and competitive labor costs.

But winning new business depends on companies showing customers how they will cut global emissions — a goal that government policies have held back, he said.

“This is a potential golden age for Mexico,” said Ives, the CW’s director of operations and manufacturing for North America. “But it has not evolved to meet market demands.”

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Francisco Fiorentini, executive vice president of industrial park development company PIMSA in Mexicali, estimated that if government policy did not block energy supplies, foreign investment in Baja California could be 45% higher.

Mexicali became a beacon for investors in 2020 when Lopez Obrador scrapped a largely multi-billion dollar Constellation Brands (NYSE::) brewery after holding a referendum against the plant, arguing it endangered the water supply.

Index’s Hernandez said Baja California and Chihuahua, another border state closely integrated with the US economy, had for the past three years lacked about 1.8 gigawatts of combined power supply to take advantage of current demand.

Mexico has made progress working with academia to speed up the training of engineers and analyzing where American companies can shift factory floors to focus on assembly, packaging and testing of semiconductors, said Monica Duhem.

She said that although the president would privately reassure companies that investing in Mexico was worth it, his repeated public denunciations of energy companies raised doubts.

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“The multinational companies said to me, ‘What is your strategy for transitioning to renewable energy?’” Duhem recalls. “

There are signs that politics are changing.

Secretary of State Marcelo Ebrard recently said Mexico needs to invest $50 billion to double its renewable energy capacity by 2030 as he discussed investing in semiconductors with executives in the border city of Tijuana.

“If you’re not producing with clean energy, you can’t export to the United States,” he said.

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Red Flags That Your Spouse Is Hiding Money (And What To Do About It)

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Marriage can be hard enough without one spouse hiding money from the other.

When financial infidelity occurs in the form of “hidden cash,” a marriage or a live-forever relationship can easily be ended.

The truth is About 30% of American couples suffer from financial infidelity. Other evidence shows that more than 75% of couples describe the hidden money situation as negative and common 10% of these scenarios end in divorce.

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US judge orders Norwegian Cruise Line to pay $110m for use of Cuba port By Reuters

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© Reuters. Norwegian American Airlines cruise ship Marina arrives in Havana Bay, Cuba on March 9, 2017. REUTERS/Alexander Meneghini/File/File Photo

Written by Brian Ellsworth

MIAMI (Reuters) – Norwegian Shipping Line (NYSE) has to pay $110 million in compensation for the use of a port confiscated by the Cuban government in 1960, a US judge said Friday, marking a significant milestone for Cuban Americans. Who are seeking reparations for the Cold War era. Assets confiscation.

The decision by US District Judge Beth Bloom in Miami follows her decision in March that use of the Havana Cruise Terminal constituted smuggling of forfeited property belonging to the plaintiff, Delaware-registered Havana Docks Corp.

The decision read: “The judgment is made in favor of Plaintiff Havana Docks Corporation and against Norwegian Cruise Line Holdings, Ltd.”

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“The plaintiff was awarded $109,848,747.87 in damages,” it says, adding that the Norwegian must also pay an additional $3 million in legal fees and costs.

Norwegian Cruise Line did not immediately respond to a request for comment.

Cuban President Miguel Diaz-Canel has sharply criticized the Helms-Burton Act, calling it an extraterritorial violation of international law.

Havana Docks also sued Carnival Cruise Lines (NYSE: ), Royal Caribbean (NYSE:) and MSC under the Helms-Burton Act, which allows US citizens to sue over the use of property seized in Cuba after 1959.

The ruling could fuel more lawsuits by Cuban exiles pursuing claims, worth $2 billion, according to one estimate, over asset seizures under late Cuban leader Fidel Castro.

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It may also serve as a reminder to multinational companies of the complexities that can come with doing business in Cuba.

In 2016, US cruise ships began traveling to Cuba for the first time in decades after a détente negotiated by former President Barack Obama eased some provisions of a Cold War US embargo.

But the Trump administration in 2019 ordered a halt to all such cruises amid efforts to pressure Cuba over its support for Venezuelan President Nicolas Maduro, Washington’s ideological foe.

The Trump administration has also allowed US citizens to sue third parties for using property seized by Cuban authorities, a provision of the Helms-Burton Act that every previous president has waived since the law was passed in 1996.

Havana Docs says Cuba, which has been under a US trade embargo for decades, has never compensated it for taking the drug.

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The four cruise lines sued in 2019 in the US District Court for the Southern District of Florida. Bloom in March held the companies liable for damages under the Helms-Burton Act, also known as the Libertad Act.

According to the US-Cuban Economic and Trade Council, a nonprofit organization that provides information on relations between the two countries, 5,913 validated claims related to property seized in Cuba represent an estimated liability of nearly $2 billion.

Forty-four lawsuits have been filed under Title III of the Helms-Burton Act, the organization says.

“For the current plaintiffs of Cuban descent, (the decision) will give them a moment of relief,” said John Cavulich, the group’s president. “It will give them a moment to say ‘You can run but you can’t hide,’” Cavulich said.

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Is a Royal Caribbean or Carnival beverage package worth it?

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An all-inclusive beverage package that gives you access to beer, wine, liquor, bottled water, soda, specialty coffee, and even shakes/juices may cost more than your cruise fare.

This is especially true right now when many cruise cabins are being sold at discounted prices while the drinks package prices have gone up.

Deciding whether to purchase a drink package is a challenge because you have to estimate whether you will be drinking enough to cover the cost. Or, more importantly, whether you’d spend more if you decided not to purchase a drink package.



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