Financial Services Opportunities in Mexico

An Expert's View about Financial Industry Support Services in Mexico

Posted on: 18 Aug 2010

After 2009, Mexico is fairing relatively well due to sound management of public finances, and taxation reforms which have allowed it to implement counter-cyclical actions. This report outlines new opportunities.

Sector briefing Financial Services Opportunities in Mexico Why Mexico? "Mexico has the second largest economy in Latin America and according to a study conducted by Goldman Sachs, it may th become the 5 largest economy in the world by 2040". After 2009, Mexico is fairing relatively well due to sound management of public finances, and taxation reforms which have allowed it to implement counter-cyclical actions. This, combined with its strategic geographical position, and a network of trade agreements afford Mexico direct access not only to the world's largest market but to different regions and to more than one billion consumers on several continents. It also has a young population, which is increasingly well trained, and with a strong focus on the skills that Mexico needs to continue developing in the future. Find general information on the Mexican For Financial Services are concentrating on 4 market conditions on UKTI?s website. The main business niche areas: Doing Business Guide for Mexico gives an overview of Mexico?s economy, business ? Public Private Partnerships culture, potential opportunities and an ? Listings (stock markets) introduction to other relevant issue. ? Arbitration ? International Finance Reporting Standards (IFRS) UK Trade & Investment Sector briefing: Financial Services opportunities in Mexico Government support is key to the successful Opportunities introduction of PPP's and Mexico is aware of the expertise the UK has in this field. The Public Private Partnerships scheme in Mexico has surpassed the consultancy phase on the Federal side. The Mexican President Felipe Calderon presented marketplace is opened to advisors at State the National Infrastructure Programme to the level, and for investors, operators and contract country on 18 July 2007. This Programme management administrators at all levels. derives from the National Development Plan. It states the objectives, strategies, goals and Mexican firms and Government Institutions actions designed to increase the coverage, have recognised their lack of knowledge of PPP quality and competitiveness of the country's schemes and have been keen to associate with infrastructure. (principally) UK firms with the relevant experience. UKTI Mexico has continued to They aim to do this using PPP's as a method of encourage the Mexican Government to increasing access to public services, continue increasing their capacity. particularly in areas of greatest needs such as healthcare, education and roads. The emphasis In addition, UKTI Mexico works closely with a on the creation of new infrastructure projects number of UK Financial Services Associations under this particular scheme also aims at such as The City UK (formerly International increasing development opportunities, Financial Services London - IFSL), British increasing the competitiveness of the Mexican Expertise (BE), Partnerships UK (PUK), Think economy and transforming Mexico into a highly London and The City of London, in order to competitive logistical platform. promote and update UK firms on the development of the projects in Mexico. Mexico has already successfully introduced a PPP programme, under the auspices of the The National Infrastructure Plan contemplates Mexican Treasury (Secretaria de Hacienda y a number of infrastructure projects. Some of Crédito Público (SHCP)), the Presidential Office, them consist of the modernisation and/or and Partnerships UK. refurbishment of the transversal and longitudinal road work that connect the For the first generation of projects, the Mexican country's main cities, with small towns, ports, Government launched 4 pilot projects; 1 for a borders and tourists centres. Other main areas polytechnic university, 1 for a hospital and 2 where the scheme is being used to develop projects for roads refurbishment, for which public services are hospitals and cultural some UK companies were winners of technical, centres. There is already one specialised financial and legal advisor contracts. hospital funded using a PPP fully operating in the State of Guanajuato and there is another Second and Third Generation projects in the one already under construction in the State of same sectors are currently being developed. A Tampico aside from the one above mentioned second hospital project has been launched in in the State of Mexico. The Federal the Northern Gulf part of the country. At the Government is also considering developing same time, up to 6 more hospitals, 8 prisons and water projects. universities and 14 road schemes are pencilled in as future PPP projects. At a State level, the At a State level, UKTI Mexico is planning for a State of Mexico has already launched 4 PPPs PPPs operators mission from London to Mexico projects consisting of one hospital, one cultural centre, one main road and an extended for October 2010. connecting bridge. As previously mentioned, one of the most UKTI Mexico has been heavily involved in the advanced States is the State of Mexico with 4 organisation of important visits to the UK from agreed projects. (International tender Mexican State governments to push further the information available only in Spanish on: introduction of PPP's. These State Governments have already made important legal reforms in (www.edomexico.gob.mx/finanzas/pps/img/jpg favour of PPP's or are in the process of doing /convocatoriaccmo.jpg ). so. They are interested in seeing how real-life projects are developed and made to work. As another example, the State of Durango has already launched 10 roads projects. UK Trade & Investment Sector briefing: Financial Services opportunities in Mexico which are keen to further promote London as Currently, The Mexican Congress is working to the top arbitration centre in the world. pass a new PPP?s law which would regulate and support the implementation of projects In partnership with UKTI Chile, UKTI Mexico countrywise. It will also offer relevant guidance invited a Mexican speaker from Von Wobeser & to State and Local Governments on Sierra, a Mexican legal firm to participate in an implementation. international seminar held in Madrid during September 2009. The Mexico City Govenrment has already planned for 8 new PPP?s projects with an Also on 30 September 2009, the President of investment of £2822 million. These 8 projects the Mexican Bar Association participated in a include a couple of new intercity highways, a seminar organised by the British Law Society street car project for the Mexico City?s historic presenting a brief on business opportunities in down town area, a third line for the Mexico City the Mexican legal sector. After this, the underground and two high security prisons. President of the Mexican Bar Association attended the opening of the British Legal Year LISTINGS on 1 October 2009. Mexico has a significant number of companies doing business internationally which are IFRS reaching the point where they need capital to By 2011-2012 all companies in Mexico will grow and realise their expansion plans. As have to prepare and produce all their financial they introduce professional management, they statements under IFRS. The UK Accountancy are now starting to meet international sub-sector is a pioneer on IFRS as these rules requirements for accountability and developed with the IASB based in London. At transparency and have begun to list in New the moment, financial executives in Mexico York. London offers an attractive alternative from companies have to undertake an with the London Stock Exchange and examination in order to obtain a certification on Alternative Investment Market (AIM). IFRS which translates into their companies being compliant on IFRS. In May 2008, a well-known mining company, Currently there is little information available on Peñoles announced its plans for raising around this in Mexico and furthermore there are a $2 billion USD through listing its gold and silver large number of companies (corporate side and operations on the London Stock Exchange. accounting) which are not fully aware of the Fresnillo plc, the world's largest primary business, systems and procedural impacts it producer of silver has now achieved a will have. Within this context, we identified successful flotation. (www.fresnilloplc.com). key sector players in the UK and Mexico in order to organise a seminar on IFRS, in order In November 2009, the London Stock to position the UK as pioneer and leader on Exchange gave a presentation to a number of IFRS practice and certifications. Mexican and International companies in Mexico City. AIM was the main highlight of the event. We organised this seminar on 23 February Furthermore there were a number of 2010. The ICAEW was the key speaker for this international nominated advisors (NOMADS) seminar. In addition, we invited partners such presenting on AIM listing processes and as the Mexican Institute of Public Accountants, successes. the Association of Public Accountants of Mexico City, the Mexican Council for Research and th UKTI Mexico will hold a follow up event on 25 Development of Financial Standards, Baker May 2010 in Mexico City Tilly Mexico (only UK accountancy firm established in Mexico) and ITAM University , (at present, the only university offering a one ARBITRATION year post-graduate degree on IFRS. Legal services, in particular arbitration are particularly relevant in business in Mexico due This event has triggered a lot of interest in to the significant number of companies IFRS and UK expertise. developing international business. Currently there are a number of local law firms that are in partnership with international law firms, UK Trade & Investment Sector briefing: Financial Services opportunities in Mexico OTHER FINANCIAL SERVICES Other Financial Services such as consultancy services, pre-paid purchasing cards, funds, investments, etc also have significant demand by companies and individuals. If you have any questions on the opportunities above, contact the UKTI contacts named in this report. Business opportunities aimed specifically at UK companies are added daily to UKTI?s website. These leads are sourced by our staff overseas in British Embassies, High Commissions and Consulates, across all sectors and in over 100 markets. You can be alerted to business opportunities on a regular basis by registering on the UKTI website. More on UKTI?s business opportunities service UK Trade & Investment Sector briefing: Financial Services opportunities in Mexico Major events and activities UKTI contacts Listings Breakfast (featuring AIM and UK Fernando Estandia Nomads) UK Trade and Investment Officer Contact: Fernando Estandia T:+52 55 52 42 85 07 Email: Fernando.Estandia@fco.gov.uk E: Fernando.Estandia@fco.gov.uk Time: 25 May 2010 (Mexico City) Website: www.ukinmexico.fco.gov.uk/ PPPs Roundtable Gisela Gonzalez Flores-Clarke Contact: Sagra Clorio UK Trade and Investment Officer Email: Sagra.Clorio@fco.gov.uk T:+52 55 52 42 85 06 Time: 25 May 2010 (Mexico City) E: Gisela.Gonzalez@fco.gov.uk Website: www.ukinmexico.fco.gov.uk Financial Services Mexico Matters Event Contact: Fernando Estandia Email: Fernando.Estandia@fco.gov.uk Sagra Clorio Jessel Time: 8 July 2010 (London) UK Trade and Investment Research Officer T:+52 55 52 42 85 35 Lord Mayor Visit to Mexico E: Sagra.Clorio@fco.gov.uk Contact: Gisela Gonzalez Flores-Clarke Website: www.ukinmexico.fco.gov.uk Email: Gisela.Gonzalez@fco.gov.uk Time: October 2010 UK Trade and Investment Mexico Desk Simon Denning Find full details of all events in this Mexico Unit country and sector on the UKTI website. Bay 954-955 New export events are added daily to the site Kingsgate House and you can register to be alerted to them on a 66-74 Victoria Street daily, weekly or monthly basis London SW1E 6SW Tel: +44 (0) 20 7215 4735 UKTI?s Tradeshow Access Programme (TAP) Email: Simon.Denning@ukti.gsi.gov.uk provides grant support for eligible Small & Medium Sized Enterprises (SME's) to attend trade shows overseas. Find out more about UKTI support for attendance at overseas events UK Trade & Investment Sector briefing: Financial Services opportunities in Mexico Next steps - How UKTI can help ? Arranging appointments British companies wishing to develop their ? Organise seminars or other events for business in the Mexican market are advised to you to meet contacts and promote your undertake as much market research and company in the Chinese market planning as possible in the UK. UKTI?s team in Mexico, with its wide local knowledge and This work is available via our Overseas Market experience, can provide a range of services to Introduction Service (OMIS) a chargeable British-based companies wishing to grow their service which assists British-based companies business in global markets. wishing to enter or expand their business in overseas markets. This can include: ? Provision of market information To find out more about commissioning this ? Validated lists of agents/distributors work, or accessing other UKTI services and ? Key market players or potential specialist advice, please visit the UKTI website customers in the Chinese market to find contact details for your local UKTI office ? Establishment of interest of such contacts in working with you Whereas every effort has been made to ensure that the information given in this document is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation & Skills, and the Foreign & Commonwealth Office), accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Published 2010 by UK Trade & Investment. Crown Copyright © UK Trade & Investment Sector briefing: Financial Services opportunities in Mexico
Posted: 18 August 2010

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