Business Environment in Mexico
Mexico became the 12th world economic power. Although the GDP fell sharply in 2009 (-6.5%), the GDP is predicted to rise by about 4% in 2010. Resumption of exports, especially car sales and US tourism are encouraging signs. The general economic outlook is relatively good. According to the different rating agencies, Mexico enjoys the “investment grade” status. The Doing Business 2010 report considers it the best country to do business in in Latin America; nevertheless, the growing security issues discourage investments and tourism. The corruption and inefficiency of Mexican bureaucracy are also among the country’s weaknesses
|GDP (billions USD)||882.22||1,039.12e||1,167.12e||1,231.64e||1,293.30e|
|GDP (Constant Prices, Annual % Change)||-6.1||5.5e||4.6||4.0||3.4e|
|GDP per Capita (USD)||8,203||9,566e||10,638e||11,115||11,556e|
|Inflation Rate (%)||5.3||4.2||3.6e||3.1e||3.0e|
|Unemployment Rate (% of the Labor Force)||5.5||5.4e||4.5||3.9e||3.5e|
|Current Account (billions USD)||-5.24e||-11.18e||-14.66||-18.86||-|
|Current Account (in % of GDP)||-0.6||-1.1e||-1.4e||-1.6e||-|
Source: IMF - World Economic Outlook Database
Note: (e) Estimated Data
Main Sectors of Industry
Agriculture accounts for approximately 4% of the GDP and employs 13.5% of the active population, however, the scarcity of credit continues to penalize this sector. Mexico ranks amongst the world's largest producers of coffee, sugar, corn, oranges, avocadoes and limes. Mexico is the world's 5th biggest producer of beer and its number two exporter. It is amongst the world's leading producers of many minerals, including silver, fluorite, zinc and mercury, and its oil and gas reserves are one of its most precious possessions: Mexico is the world’s fifth largest producer of oil. The oil company PEMEX is the second most powerful company in Latin America, according to the industry journal América Economía. Cattle farming and fishing are also important economic activities.
The aerospace sector has grown sharply in the last five years, due to the presences of almost 190 companies, such as Bombardier, Goodrich, the Safran group and Honeywell, which together employ 30 000 people. Mexico is also one of the 10th major car producers. The hi-tech, information and software development sectors are also experiencing a real momentum, driven by the quality of the workforce, clusters and low operating costs, which allow for the establishment of call centers.
The tertiary sector contributes to around 60% of the GDP and the construction sector is coming up again due to real estate investments.
|Breakdown of Economic Activity By Sector||Agriculture||Industry||Services|
|Employment By Sector (in % of Total Employment)||13.5||25.9||59.9|
|Value Added (in % of GDP)||4.3||34.8||60.9|
|Value Added (Annual % Change)||1.8||-7.3||-6.7|
Source: World Bank - Last Available Data.
|Mexican Peso (MXN) - Average Annual Exchange Rate For 1 USD||10.90||10.90||10.93||11.13||13.51|
Source: World Bank
Indicator of Economic Freedom
- Moderately free
- World Rank:
- Regional Rank:
Foreign Trade in Figures
Mexico is one of the countries that most depends on foreign trade. Foreign trade represents around 60% of its GDP. Mexico has 11 free-trade agreements with 43 countries of the world. It is a member of NAFTA - the free-trade agreement that unifies the United States, Mexico and Canada, since 1994. The country signed a free trade agreement with the European Union in 2000 and a commercial agreement with Japan came into force in April 2005.
The United States buys 80% of Mexico's exports. Its main export partners are the NAFTA and the European Union. The main export goods are electrical and electronic equipment, vehicles, mineral fuels, oil and machinery. Its three main import partners are the NAFTA, China and Japan. It mainly imports electrical and electronics equipment, machinery, vehicles and plastic products.
In 2010, Mexican exports increased by 32% on the previous year. During the same period, internation car sales increased sharply by 76.8%, which may also represent a threat of dependency for the Mexican economy.
|Foreign Trade Indicators||2006||2007||2008||2009||2010|
|Imports of Goods (million USD)||263,476||290,246||318,304||241,515||310,618|
|Exports of Goods (million USD)||249,961||271,821||291,265||229,712||298,361|
|Imports of Services (million USD)||22,329||23,228||25,001||21,402||23,056|
|Exports of Services (million USD)||16,372||17,598||18,474||15,420||16,178|
|Imports of Goods and Services (Annual % Change)||12.6||7.1||2.8||-18.2||-|
|Exports of Goods and Services (Annual % Change)||10.9||5.7||0.5||-14.8||-|
|Imports of Goods and Services (in % of GDP)||29.2||29.8||30.4||29.3||-|
|Exports of Goods and Services (in % of GDP)||28.0||28.2||28.2||27.8||-|
|Trade Balance (million USD)||-6,133||-10,074||-17,261||-4,602||-|
|Trade Balance (Including Service) (million USD)||-12,574||-16,529||-24,016||-||-|
|Foreign Trade (in % of GDP)||57.2||58.0||58.6||57.1||-|
Source: WTO - World Trade Organization ; World Bank
Main Partner Countries
(% of Exports)
|Other partnersClose extended list||12.1%|
(% of Imports)
|Other partnersClose extended list||24.3%|
Sources of General Economic Information
Ministry of the Economy
Ministry of Social Development
Ministry of Finance
Ministry of Energy
- Statistical Office
National Institute of Statistics and Geography
- Central Bank
Bank of Mexico
- Stock Exchange
Mexican Stock Exchange
- Search Engines
- Economic Portals
Trade in Mexico
- Executive Power
- As established by the Constitution, the Executive power is headed by the President of the United Mexican States.
The President is both head of state and head of government. He is Supreme Commander of the Army Force.
The President is elected by popular vote and cannot be reelected. The presidential term lasts six years.
- Legislative Power
- The Mexican legislative power is in the hands of the General Congress which is divided in two chambers: the Deputies and the Senators.
The Chamber of Deputies has 500 members, from which 300 are elected according to the principle of plurality. The remaining 200 are elected through the rule of proportional representation.
The Chamber of Senators applies in the same manner the principle of proportional representation by integration, electing 32 of its 96 members every two years.
- Main Political Parties
- Mexico has a multi-party system. There are three major political parties in the country:
- PAN (National Action Party) – a conservative liberal party, to which the actual President of the Republic belongs.
- PRI (Institutional Revolutionary Party) - the oldest political party in the country, it governed for 70 years, it is the center or middle party.
- PRD (Party of the Democratic Revolution)- a left wing socialist party.
- Current Political Leaders
- President : Felipe Calderón Hinojosa elected on July 2, 2006, member of PAN
- Next Election Dates
- Presidential: July 2012
Senate: July 2012
Chamber of Deputies: 2012
Indicator of Freedom of the Press
- World Rank:
- 2 places up compared to 2008
Indicator of Political Freedom
- Political Freedom:
- Civil Liberties:
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Exports of agricultural, fish, and forestry products to Mexico reached almost $19 billion in 2011, consolidating Mexico as one of the largest and fastest growing markets for U.S. agricultural products
Foreign Agricultural Service on 11 Jan 2013 related to Business Environment in Mexico
The reviving demand from the US led the Mexican economy out of the economic slump in 2010 and allowed the country to further grow by 4.0% last year.
Hong Kong Trade Development Council (HKTDC) on 30 Jul 2012 related to Business Environment in Mexico
An internet version of the U.S. Country Commercial Guide for U.S. companies looking to do business in or through Mexico.
U.S. Commercial Service Mexico on 19 Jul 2012 related to Business Environment in Mexico
2012 Country Commercial Guide for U.S. Companies doing business in Mexico.
U.S. Commercial Service Mexico on 27 Apr 2012 related to Business Environment in Mexico
Looking forward, the Mexican economy is forecast to grow at a more moderate pace in 2012, as the impacts of government efforts to boost job creation and restocking by local and US companies wane.
Hong Kong Trade Development Council (HKTDC) on 29 Jan 2012 related to Business Environment in Mexico
Annual report investigating regulations that enhance business activity and those that constrain it. for 183 countries. Courtesy of The World Bank and The International Finance Corporation.
Southern Border Logistics on 31 Aug 2011 related to Business Environment in Mexico
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