Mexico, German-Mexican Relations in

German states entered into political relations with Mexico shortly after Mexico gained independence from Spain. After Great Britain officially recognized Mexican independence in 1825, Prussia agreed to establish commercial ties with the new state.

Louis Sulzer was appointed the first Prussian trade agent in Mexico. In summer 1826 both countries concluded a trade treaty based on the principle of mutual preferential treatment; and in summer 1830 Prussia sent its first consul general, Carl Wilhelm Koppe, to Mexico City. In February 1831 both sides signed a treaty guaranteeing mutual friendship as well as regulating the naval and trade relations between Prussia and Mexico.

Prussia only reluctantly extended political recognition to Mexico, because the new government violated basic principles of traditional political legitimacy. In contrast, German Hanseatic cities, which were concerned with pragmatic economic interests, were much more interested in establishing trade relations with the new country quickly. However, the political climate in the post-Napoleonic era prevented these smaller German city-states from engaging in an active and independent trade policy. In 1825 the merchant Hermann Nolte was appointed trade agent of the Hanseatic League for their trade with Mexico. Two years later the three Hanseatic cities— Lubeck, Bremen, and Hamburg—entered into a friendship, naval, and trade agreement with Mexico. According to this treaty, both sides enjoyed the freedom of trade, movement, and settlement in each other’s countries. The main goal for the Hanseatic League in these trade negotiations was the recognition of the principle of reciprocity. Because of extreme economic nationalism and distrust of foreign interests, the Mexican government did not ratify this treaty. After long negotiations, a second treaty that significantly limited the rights of Hanseatic merchants in Mexico was concluded in 1831, but ratified only in 1841.

These trade treaties included the political recognition of the new Mexican state.

Mexico’s major export products were minted silver, cochineal, and dyewood. Indigo and vanilla played initially only a minor role in Mexican export trade. Only at the end of the nineteenth century did agricultural products become the second most important category among exported goods. Silver exports lost a significant share within the export industry, but remained the single most important export product (50 percent of all export goods) (Canales 1977, 30).

Consumer products were Mexico’s main imported goods during the first half of the nineteenth century. More than 90 percent of all imported goods were finished and half-finished products (textiles, foodstuffs, ceramics, paper, and tools) (Canales 1977, 51). The German-Mexican trade seemed to take off quite promisingly after 1821. The naval trade experienced a boom, especially during the 1830s. In 1830 thirty-nine German merchant companies existed in Mexico, among which were the Rheinisch-Westindische Compagnie (Rhenish-West Indies Trade Company) and the Preuβische Seehandlungsge- sellschaft (Prussian Naval Trade Company). During the 1820s, about 20 percent of all Mexican imports came from the German states—the most important German import product being linen, especially Silesian platillas (Becher 1834, 220). Economic historians estimate the volume of German imports for the time of the Bustamante administration (1830—1832) at 10 million mark banco (this equaled 5 million Prussian talers and 4 million pesos) (Becher 1834, 160). By the mid-1830s, about one- third of all Mexican trade was handled by German trading companies in Mexico (Dispatch from Gerolt to Prussian Ministry of Foreign Affairs, Mexico 18.3.1834: ZSAM [Zentrales Staatsarchiv Merseburg] 2.4.1. II 5218 f. 218). According to some estimates, more than one-third of all Mexican imports came from German states in 1836 (Letter from Ancillon to King Friedrich Wilhelm III, Berlin 11.12.1836: ZSAM 2.4.1.

II 652, f. 99—103). Mexican customers purchased more Prussian linen than North America and Brazil together. Other estimates, however, reject this statistic and suggest that, for instance, in 1835 only about 7 percent of all Mexican imports came from Germany (Zoraida Vazquez 1976). Besides trade, mining occupied a very important position in German-Mexican relations. The German- American Mining Corporation was active in Mexico throughout the first third of the nineteenth century.

Next to linen, the second most important textile for German-Mexican trade was silk from the Rhine Provinces. In 1825 Charles O’Gorman, the British consul general in Mexico, concluded that: “German linens, of immense consumption, bear a decided preference to the imitation British manufactures in these markets; the quality of the Germans is generally better, and is cheaper to the consumer” (Trade Report from O’Gorman to Planta, Mexico 1.3.1825: Public Record Office Foreign Office [PRO FO] 203/4, f. 253). Soon, however, Irish linen replaced German linen. Already at the beginning of the 1830s, British exporters succeeded in displacing German higher-quality textile products from Westphalia. Although Mexican consumers bought about 150,000 pieces of Silesian and Saxon Platillas Royales on an annual basis (Koppe 1831), the decline of German linen export to Mexico became very clear. The reasons for this decline are manifold: British cotton was in very high demand. English linen was, compared with the German, much cheaper because of the higher degree of mechanization in its manufacture. Silesian linen, furthermore, was of a poorer quality. Lastly, German import companies in Mexico diversified their businesses more than British trading companies. The decrease of German linen imports into Mexico did not result in a decrease of the total share of German trade in Mexico’s overall imports. The opposite was the case. The volume of German trade with Mexico increased during the 1840s. Linen, however, was replaced by now with iron and steel products from the Bergisches Land, toys from southern Germany, and silk from Elberfeld and Krefeld.

At the end of the nineteenth century, Mexico bought German armaments from Krupp and Mauser. The original linen trading companies transformed into almacenes (warehouses) with a large variety of products. It has been said that about 20 percent of all Mexican imports during the 1840s came from Germany. German merchants, especially the merchants of the Hanseatic League, played an important role in the Mexican import and export trade. They not only managed the import trade from Germany, but also a large segment of the English and French trade. It has been estimated that in 1844 one-third of Mexico’s export/import trade was in German hands, and in 1860 three-fourths of Mexico’s export trade was said to be dominated by Germans (Potash 1953, 474-479).

While German manufacturers were very interested in selling their products in Mexico, German customers’ interest in Mexican imports was very low. In 1910 about 13 percent of all Mexican imports came from Germany, but only 3 percent of all Mexican exports went to Germany (Darius 1927). In terms of direct investments, Mexico did not attract large amounts of capital. Only in the 1880s did some German banks invest in Mexican mining and petroleum production. Bleichroder was the first banker to extend loans to the Mexican government at the end of the eighties. After the turn of the twentieth century, the Deutsche Bank and the Frankfurter Metallgesellschaft (Frankfurt Metal Society) appeared on the Mexican market. The Frankfurter Metallge- sellschaft, together with American investors, founded the Companιa Minera de Penoles; Bleichroder invested in the Mexican Petroleum Company; and the Hapag (Hamburg-Amerika Linie; see entry on Hapag) closely collaborated with American shipping companies involved in the Mexican trade.

After 1907 collaboration between Germany and the United States in Mexico was replaced by economic rivalry for market shares in Mexico. The Berliner Handelsge- sellschaft (Berlin Trade Society), headed by Carl Furstenberg, attempted to achieve control over Mexico’s train system.

Fursten- berg, however, was able to acquire only 20 percent of the shares of the Ferrocarriles Nacionales de Mexico. At the same time, the Dresdner Bank, together with the Schaffhausener Bankverein, established the Deutsch-Sudamerikanische Bank (German-South American Bank), which was closely connected to the family of the later revolutionary president Francisco Madero. At the outbreak of the revolution, Germans had invested about 75 million pesos in Mexico: 42 million in trade, 13 million in agriculture, 10 million in industry, and 10 million in banking (Katz 1987). In addition, Germans had bought about 30 million pesos in government-issued bonds (bonos) (Katz 1987). Since the 1880s, Germans had bought coffee plantations in the Soconusco region and the state of Chiapas.

In 1892 there were 26 German large-scale coffee plantations in the Soconusco region, which were supported financially by German banks and trade companies.

Since the beginning of the twentieth century, Mexico’s geopolitical position made it more and more attractive for Germany’s political and military leaders. The German Empire wanted to use Mexico to counterbalance the influence of the United States. Germany’s military even considered buying or leasing military bases in Mexico. The outbreak of the Mexican Revolution in 1910 surprised the German government. Opposed to the new Madero government, Germany and the United States found common ground and contributed to the downfall of Madero. During the Huerta dictatorship (1913—1914), German foreign policy focused on opposing the extension of the Monroe Doctrine to Mexico. Had the Germans been successful, they could have transformed Mexico into a kind of German protectorate.

Between 1914 and 1917, the German government considered Mexico a tool to influence the foreign policy of the United States. Germany’s goal was to provoke a military conflict between the United States and Mexico to prevent the United States from interfering on behalf of France and Great Britain in World War I.

The Zimmermann Telegram, in which Germany promised Mexico the return of Texas, New Mexico, and Arizona if Mexico would join Germany in the war against the United States, represented the peak of this failed foreign policy.

After 1917 Germany changed its policy. After Venustiano Carranza rejected the German offer of a German-Mexican alliance, Germany attempted to make Mexico a German protectorate. The German ambassador, Henrich von Eckhardt, mentioned German plans “to take control in Mexico” in his dispatches (Katz 1964). While all these attempts were condemned to fail, Germany succeeded in producing a pro-German mood in Mexican society. During the war years, German-Mexican trade, especially of oil and coffee, soared.

After Adolf Hitler became Reich chancellor in 1933, German interest in Mexico increased again. On the one hand, Hitler needed to neutralize the propaganda of the Allies, and on the other hand, the Nazi leaders hoped that Germans living in Mexico would support the Nazi movement. Although Mexico refused to sign a bilateral economic treaty with Nazi Germany, German businesses successfully penetrated Mexico’s economy. However, German businesses replaced British but not American influence in Mexico. After the nationalization of foreign oil companies enacted by the government of Lazaro Cardenas in 1938, Germany became an important trading partner for Mexico. Mexico delivered oil in exchange for German manufactured goods. In 1939 nearly two-thirds of Mexico’s entire oil production went to Germany (Schuler 1987, 173—186).

When World War II broke out, Mexico declared its neutrality. German-Mexican economic relations lost their importance throughout the war years due to Germany’s chaotic economic organization. Mexico avoided as long as possible joining one or the other side in the war. However, as early as 1941, such a position could no longer be sustained. After Mexican newspapers had criticized harshly the racial policies and ideologies of the Third Reich, the Mexican government seized all German ships in Mexican ports in April 1941, closed all German consulates in the fall of the same year, and declared war in May 1942, as a reaction to the German attack and destruction of two oil tankers. Mexican authorities, furthermore, targeted German property. Several hundred Germans were interned in Fort Perote, their property was taken temporarily and later returned. German coffee plantations in Soconusco, too, were temporarily brought under government control.

In 1952 West Germany and Mexico reopened diplomatic relations, after both countries had already concluded a trade agreement two years earlier. The German economic upswing during the 1950s led German entrepreneurs and bankers to invest large amounts of capital in Mexico again. Both countries entered bilateral agreements on economics, technology, culture, education, air transport, and taxes. In 1964 the Volkswagen Company established a production facility in Puebla. And in 1977 the first VW Beetle was exported from Mexico to Germany.

In 1973 Mexico entered into diplomatic relations with East Germany. Both countries developed an extensive network of cultural and trade relations. Since the unification of both German states in 1990, German Mexican relations have constantly grown. Today, there are more than 840 German firms engaged in Mexico. More than 300,000 German tourists annually spend their vacations in Mexico. In July 2000 Mexico entered a treaty on economic association and political collaboration with the European Union. This treaty led to a tremendous growth of trade between Mexico and the European Union. Germany still remains the most important European trading partner of Mexico. In general, Germany is second only to the United States in Mexico’s foreign trade volume. While Germany exports cars and car parts, optical and electronic instruments, machines, and chemical and pharmaceutical products to Mexico, Mexico exports cars and car parts, shoes, coffee, honey, copper, chemical products, and oil to Germany. In 2001 German exports to Mexico reached a total value of more than $6 billion, while German imports from Mexico were valued at $1.6 billion. Between 1995 and 2001, German businesses and the German government invested about $2.7 billion in Mexico.

Walther L. Bernecker

Mexico, German-Mexican Relations in

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