Asian Textile Plants Coming to Mexico

Sidestepping the punishing tariffs soon to be levied by the North American Free Trade Agreement on textiles produced outside the region, two Asian firms are investing $250 million in factories in Ciudad Obregon in Sonora state, Mexico. Both companies are targeting the U.S. market and chose the city because of its proximity to the Guaymas port and ample supplies of cotton, Sonora Economic Development Subsecretary Enrique Franco Celaya said. China World Best, owned by the Chinese government, will invest $150 million in a textile complex to open next summer that will include yarn and fabric mills employing 3,000 workers. The Chinese, who last month bought a 70-acre site after considering several alternative cities including Tijuana and Oaxaca, will buy 15% of the annual Sonoran cotton harvest for its fabrics. Ghimtex, a Singapore-Indonesia joint venture, is launching a $100-million factory to produce fabrics and finished sports apparel, also employing thousands. Among three major textile producers already in southern Sonora is Taiwan-based California Textile, which makes clothes for Banana Republic, Nike and Reebok.