Mexico City: Trade between Thailand and Mexico could increase by 20-30% following the signing of 29 agreements between Thai and Mexican businesses to expand trade and investment in the short term.

The memoranda of understanding cover sectors including automobiles and parts textiles, jewellery, food, spas, construction and trading businesses.

The two countries have also agreed in principle to work on shortening customs procedures, said Vachara Phanchet, the Thai Trade Representative, who led a business mission to Monterrey and Mexico City this week.

He met executives of the Chamber of Manufacturing Industry of Nuevo Leon, representing leading industries in the northern state, encouraging them to invest in Thailand.  The Thai delegation also held talks with the investment promotion agency ProMexico and the Mexican Business Council for Foreign Trade Investment and Technology.

Mr. Vachara said each country hoped to use thhe other as a gateway to other markets in their respective regions.

Mexico is Thailand's second largest trade partner in Latin America after Brazil.  Thai exports to Mexico in the first seven months of this year were worth $729.6 million.  Bilateral trade in 2009 was $940.97 million, down 21.7% from 2008 because of the global recession. Thailand held a large surplus with exports of $728.53 million of the total.

Siriporn Nurugsa, director of the New York Office of the Board of Investment (BOI), said Mexico held great appeal because of its location,tax privileges and supply of low-cost materials under the North America Free Trade Area.

She said Thai investors could supply auto parts to Mexican companies for assembly and re-export to the US market, for example.  Textiles for the US and Latin America markets are another promising sector, she added.

The BOI plans to hold a business matchmaking event for Thai and Mexican auto parts producers in May.

Mexico is the 10th largest vehicle producer in the world and Thailand is 14th.