Foreign Direct Investment in Mexico

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FDI in Figures

Mexico is one of the emerging countries most open to foreign direct investment. However, over the last few years, its competitiveness has been slowed down due to the increase of organized crime and a lack of reforms in the energy, professional and financial fields.

The areas where foreign investments are concentrated the most are the border towns with the United States (where assembly factories are located), as well as the capital. The Yucatan peninsula continues to receive foreign investments thanks to its tourism appeal. These investments come especially from the United States and Spain (mainly from the banking sector). The sectors receiving significant foreign investments are finance, automobile industry and electronics services.

During 2010, the major investors in Mexico were the Netherlands with 7.461 million dollars, or 52% of total FDI and the United States with up to 30%. This reflects Heineken’s significant acquisition of the beer operations of the Mexican group Femsa. Spain, on the other hand, has significantly reduced its investments in the country. With nearly 14.362 million dollars of FDI in 2010, Mexico’s appeal has again increased, compared to the last two years. According to the 2010 global competitiveness report of the World Economic Forum, Mexico ranked 28th in terms of foreign investor confidence.


Country Comparison For the Protection of Investors

  Mexico Latin America & Caribbean United States Germany
Index of Transaction Transparency* 8.0 4.1 7.0 5.0
Index of Manager’s Responsibility** 5.0 5.3 9.0 5.0
Index of Shareholders’ Power*** 5.0 6.0 9.0 5.0
Index of Investor Protection**** 6.0 5.1 8.3 5.0

Source: Doing Business

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action. **** The Greater the Index, the Higher the Level of Investor Protection.

Foreign Direct Investment 2007 2008 2009
FDI Inward Flow (million USD) 27,440 23,683 12,522
FDI Stock (million USD) 273,831 297,001 309,523
Performance Index*, Ranking on 141 Economies 100 101 97
Potential Index**, Ranking on 141 Economies 58 59 -
Number of Greenfield Investments*** 213 346 317
FDI Inwards (in % of GFCF****) 11.9 9.2 -0.6
FDI Stock (in % of GDP) 25.4 27.3 35.4

Source: UNCTAD

Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.

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Why You Should Choose to Invest in Mexico

Strong Points
- Mexico forms a bridge between North America and Latin America due to its geographical location;
- Mexico has an extensive variety of natural resources allowing for the development of all types of industries at competitive prices;
- Mexico is very open to direct foreign investments;
- Labor costs are not high and in general, there is a skilled labor force;
- Positive structural reforms have been made during the current presidential term;
- Mexico is the world's 8 th tourist destination.
Weak Points
- The country depends excessively on its partnership with the United States;
- There is a high level of corruption;
- During the last few months, violence has increased especially the drug cartels;
- The country is encountering significant structural problems (economic and social).
Government Measures to Motivate or Restrict FDI
The Mexican Government has created an open and safe environment for foreign investors. The recently undertaken economic policies should allow investors to manage the safety of their operations despite the unfavorable global external environment.

Public tresury funds have been made available to private companies that have been heavily affected by the crisis. Thus in November 2008, the Mexican government saved the Vitro company, one of the world's biggest glass producers, which was having liquidity problems because of its debts. The amount disbursed to save it was evaluated at 100 billion dollars. The cement corporation, Cemex, in turn registerd a 15 billion dollar debt, a debt which is higher than the value of the company, due to the collapse of the world construction sector.

Bilateral Investment Conventions Signed By Mexico
Mexico counts with 24 Promotional and Reciprocal Protection Agreements for the Investments with Different States

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Procedures Relative to Foreign Investment

Freedom of Establishment
Acquisition of Holdings
Having a majority of capital holdings in a Mexican corporation is legal, except in certain sectors.
Obligation to Declare
To find out the total to be declared consult General Direction of Foreign Investments
Competent Organization For the Declaration
General Direction of Foreign Investment
Find Investment Service Providers in Mexico on

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Investment Opportunities

Investment Aid Agency
Mexicali Industrial
National Bank of Foreign Trade
Tenders, Projects and Public Procurement
Compranet, Public Procurements
Tenders Info, Tenders in Mexico
Compranet, Tenders
DgMarket, Tenders Worldwide

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  • Ease of Doing Business in Mexico 2011

    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 Foreign Direct Investment in Mexico

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