Mexico Warns US of Alternatives on Trade, Points to China

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Mexico sent a stark message to U.S. President Donald Trump on Thursday, saying an upcoming visit to China in September made it clear Latin America's No. 2 economy "has lots of other alternatives" amid tense trade negotiations.

Mexico is grappling with Trump's desire to renegotiate the North American Free Trade Agreement (NAFTA) that underpins its economy, prompting the government to try and diversify away from the United States, which takes 80 percent of its exports.

"We will use [the China visit] geopolitically as strategic leverage," said Guajardo, answering questions from reporters. "It sends the signal that we have many alternatives."

Mexico has tried to deepen commercial links with China for years, and President Enrique Pena Nieto had hoped a Chinese high-speed train contract would presage more investment.

However, the train deal was scrapped in 2014 after Pena Nieto and his then-finance minister became embroiled in a conflict-of-interest scandal.

The incident soured relations, but the election of Trump, who has voiced opposition to free global trade, has brought them closer again.

Mexico runs a sizeable trade deficit with China, and the government could face resistance from Mexican manufacturers to opening up to China, as the two often compete directly.