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Mexico's governors tap investors in China, elsewhere

| MEXICO CITY, March 29

MEXICO CITY, March 29 Mexico's states are turning to Asia and beyond as some U.S. companies put investment plans on hold south of the border following President Donald Trump's calls to bring jobs back home.

A delegation of three Mexican state leaders, headed by the National Confederation of Governors (Conago), traveled to China this week to meet with business leaders and discuss investment opportunities.

"Conago is developing an agenda with China's provinces to build investment projects in our country," Conago tweeted on Wednesday. "China and Conago agree on building bridges for business, not walls."

Fears of a hit to foreign investment ran high when Ford Motor Co canceled a $1.6 billion plant in Mexico's central state of San Luis Potosi in January.

Trump, who had railed against U.S. manufacturers investing in Mexico, hailed the decision as a major victory, but Ford put it down to declining demand for small cars.

"We're not going to sit here with our arms crossed. We're going to turn to Asia, like we've been doing. We want the Chinese to come invest in Hidalgo," state Governor Omar Fayad said in an interview. "We want the Japanese to invest here."

Fayad was speaking on the sidelines of an event organized by China's Anhui Jianghuai Automobile Group Co Ltd (JAC Motors) and Mexico's Giant Motors, which presented a new line of passenger vehicles that will be assembled in Mexico.

The Hidalgo government is also reaching out to European, Canadian, South American and Middle Eastern companies, and expects to announce several more investments this year, he said.

Fayad said the Hidalgo investment plans of some U.S. companies, which he declined to name, had recently been suspended indefinitely. "Obviously other countries are seeing this as an opportunity in Mexico," he said.

In February, JAC Motors and Giant Motors, along with distributor Chori Co Ltd, said they would invest some $210 million in an existing plant to build SUVs in Hidalgo.

"Mexico is a strategic market for JAC," David Zhang, head of international markets for JAC, said on the sidelines of the company's event. "If the products and service are accepted by customers and there is a lot of market demand of course we will increase production capacity."

JAC, which aims to produce 10,000 commercial and passenger vehicles in Mexico over the next three years, will initially concentrate on selling in the local market, Zhang said. (Reporting by Anthony Esposito; Editing by Richard Chang)

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