At this point, we’ve all heard the stories about how the hydraulic fracturing revolution has jumpstarted an American manufacturing boom.

But it’s nothing compared what’s going down south of the border.

As it turns out, Mexico could actually be the biggest winner in our shale boom. Imports of natural gas into the South American nation have surged during the last few years. Add in lower labor costs and favorable trade rule status with the U.S., and you have a recipe for superior manufacturing gains.

For investors, a bet on Mexico could be one of the more interesting side plays on rising shale production.

$20 Billion to $60 Billion

The availability of cheap natural gas in the United States has prompted a lot of speculation about a domestic manufacturing renaissance, but the real industrial story could be in Mexico.

Falling natural gas prices caused state-owned oil giant Petroleos Mexicanos to cut drilling to roughly zero during the depths of the 2008-09 recession. Since then, Mexico has found it in its best interest to begin importing excess gas from the U.S., especially since the lack of investment and prospecting has all but wiped out the nation’s reserves. Mexican imports of U.S. gas have skyrocketed 92% since 2008, reaching a total of 767 billion cubic feet last year, and they’re poised to grow even more.

Much of that growth is coming from the switch from oil-based power plants to those that burn gas. With crude prices continuing to skyrocket, burning fuel oil is currently about three times more expensive than a comparable amount of natural gas.

Replace the word “oil” with “coal,” and you have a situation that sounds awfully familiar to what is happening in the U.S.

Overall, Mexico has drafted plans to add roughly 28 gigawatts of new generating capacity that will be fueled by natural gas. Most of those new power plants will be located strategically in the north, near bustling Maquiladora hubs. With these new plants going online, Mexico’s energy minister estimates that Mexican gas demand will grow 3.3% annually through 2016.

These new, cheaper power plants will drive the Mexican cost advantage to even wider margins and make the nation a much bigger manufacturing powerhouse than it currently is.

Last year, wages in the South American nation reached a “tipping point,” according to researchers at Boston Consulting Group, and finally fell below chief producer and rival China. Much of this has to do with the rising value of the Chinese Yuan as well as the surging cost of overseas shipping.

Then there are other “bonuses” with regards to the nation.

Aside from Mexico’s relatively low labor costs and shorter supply chains — due to the country’s proximity to markets in the U.S. — Mexico has smartly secured 44 free-trade agreements including NAFTA. Numbering more than any other nation, these key agreements allow the bulk of its exports to enter major economies with few or no duties. Mexico also has a strong reputation for protecting intellectual property — something China doesn’t seem to value at all.

Boston Consulting predicts that Mexico will add between $20 billion to $60 billion in additional output to the nation’s economy annually.

Moving South

That’s some pretty serious potential economic muscle for an emerging-market nation — the kind that just begs for investment.

The obvious play is the iShares MSCI Mexico ETF (EWW). The fund tracks 49 of the nation’s largest players and holds roughly 64% of its portfolio in industrial, materials and consumer products manufacturers. All of those sectors will benefit from a manufacturing boom due to rising natural gas imports. In fact, these firms have already seen some boosts as imports from Mexico into the U.S. hit all-time highs.

The fund has pulled back about 14% from its 52-week high as investors have generally sold off emerging markets due to the Fed’s taper talk. While there might be more short-term pain ahead for EWW, this is a long-term idea, and that decline could be a great starting point for investment. Expenses for EWW are pretty cheap at 0.53% — costing just $50 per $10,000 invested.

The other Mexican power play is to bet on the providers of all that cheap and juicy natural gas. In this case we’re talking about major pipeline operator El Paso Pipeline Partners, LP (EPB). The master limited partnership recently commissioned an expansion of export capacity at its Wilcox Lateral transmission site.

That midstream system sits at the eastern Arizona/Mexico border and the upgrade added 0.185 bcf per day to its capacity. It’s not the only pipeline play into the nation, but with a 5.6% dividend and Kinder Morgan’s (KMI) backing, it’s one of the best.

As of this writing, Aaron Levitt did not hold a position in any of the aforementioned securities.