Your loss is our gain…

… or so argues Jay Bildstein in The (Mexico City) News:

It is said that 70 percent of the U.S. economy is consumer based. Rampant consumerism is a way of life in the United States. A powerful addiction to purchasing has provided nations like China with a seemingly limitless market for its goods. Cheap Chinese products and voracious U.S. consumption patterns have been wedded for some time now.

…

China has a comparative advantage over Mexico in terms of labor costs, yet rising transportation costs will cause the price of Chinese products to rise. This will make them less attractive.

Goods produced far from the world’s largest consumer market are most affected by upwardly arcing transportation costs. The forward progress of the Chinese economy – and the economy of India for that matter – is increasing petroleum demand. Ironically, this causes their goods to become less desirable since their growing economies demand more energy. This demand has the tendency to drive up oil prices and increase worldwide transportation costs.

Mexico, sitting next door to the world’s largest consumer market, has a tremendous window of opportunity due to its logistical advantage over Asia. Proximity means a significant competitive edge because of lower costs of transportation to market.

One we don’t think of, but maybe in the U.S. should be thought about (and Bildstein did notice) is that Mexico also has professional services (at least some in the U.S. now depend on Mexico for medical services) that can be performed by telecommuting or over the internet: architecture, engineering, programming, etc.