Mexico has large potential to boost its productivity and attract investment from companies looking to relocate their operations to North America. It also has an historic opportunity to spread the benefits of trade throughout the country, integrate SMEs more forcefully into value chains and to create more and better value chain linkages. Nearshoring is also an opportunity to step up efforts to address and mitigate climate change. Fully realising these opportunities will require addressing long standing challenges related to transport and digital connectivity, regulations, the rule of law, renewable energy and water scarcity.