Mexico Business Opportunities
Mexico has a free market economy, the 11th largest in the world. It contains a mixture of modern and outmoded industry and agriculture, increasingly dominated by the private sector. Recent administrations have expanded competition in seaports, railroads, telecommunications, electricity generation, natural gas distribution, and airports.
- Key Industries:
- Textiles, Clothing, Motor Vehicles, Parts, Chemicals, Mining, Iron and Steel, Petroleum, Tobacco, Food and Beverages, Consumer Durables, Tourism
- Key Imports:
- Agricultural Machinery, Car Parts for Assembly, Electrical Equipment, Steel Mill Products, Metalworking Machines, Aircraft and Aircraft Parts, Repair Parts for Motor Vehicles, Energy Products
- Key Exports:
- Vegetables, Coffee, Cotton, Fruits, Silver, Oil and Oil Products, Manufactured Goods, Food and Beverages, Chemicals, Iron & Steel, Textiles, Motor Vehicles, Consumer Durables
In 2016 exports to U.S. were 79.9%; imports from the U.S. were 46.4%; China 17.7%; and Japan 4.3%.
Mexico has 49 free trade agreements with over 46 countries including, Guatemala, Honduras, El Salvador, the European Free Trade Area, and Japan, putting more than 90% of its trade under free trade agreements. Asian cash is coming into Mexico. Companies from across the Pacific use Mexican manufacturing as a forward base. Mexico is a key member of the North American Free Trade Agreement, NAFTA, which includes the U.S. and Canada. Mexico has joined the TPP (Trans Pacific Partnership) negotiations that still are pending.
Business and Market Sector Opportunities
Construction • Manufacturing • Transportation • Telecommunications • Retail Automotive • Aviation • Mining • Oil and Gas • Information Technology • Tourism • Energy
Economic Background and Situation
Per capita income is approximately one-third that of the US; income distribution remains unequal. Trade with the US and Canada has tripled since the implementation of NAFTA in 1994; the NAFTA agreement is currently being renegotiated by Mexico, the U.S. and Canada.
The Pena Nieto administration was able to garner support from the opposition and pass pension and fiscal reform programs. Many economic challenges include the need to upgrade infrastructure, modernize labor laws, and allow private investment in the energy sector. Presidential elections will ne held in July 2018.
New president of Mexico assumed office in December 2018; won the election with 60% of the Mexican vote. New anti-corruption measures and related legislation have been enacted. In 2019, Mexico is planning to enact new US/Mexico/Canada trade agreement to replace the current NAFTA agreement.
In the current environment and situation, growth is predicted to be below potential given reduced oil production, weak oil prices, and some structural issues (e.g. low productivity, high inequality, weak rule of law and corruption).
American Chamber of Commerce Mexico