Analysts Predict Foreign Investment Surge in Mexico

Mexico’s proximity to the US market and the country’s openness to outside investment will create a surge in foreign investment this year, according to analysts quoted in a report by local newspaper
El Universal
. The report tallies with comments made by BNY Mellon’s director and head of treasury services for Latin America,
Dino Sani
in a recent article for
gtnews
.

Mexico’s recently elected president, Enrique Pea Nieto, is regarded as pro-business and keen on further opening the nation to foreign investment. Under his watch the government is expected to approve Mexico’s foreign investment reform law soon, American Chamber of Commerce president David Hurtado was quoted as saying.

Foreign firms investing in Mexico also benefit from the North American Free Trade Agreement (NAFTA) that has existed between the governments of the US, Canada and Mexico since 1994, preferential access to 44 nations through various trade treaties, cheap labour, legal protection for foreign investment and a sizable local market.

Mexico’s foreign investment has nonetheless dropped in the past two years, hitting US$12.7bn in 2012 according to the local report, which cited figures from the UN conference on trade and development (UNCTAD), although the trend is expected to reverse this year.

Shigeo Nagano, president of the Japan Chamber of Commerce and Industry was quoted as saying that Japanese businesses are eagerly looking for investment opportunities in Mexico’s transport and energy sector, focusing specifically on bullet train tenders and petroleum exploration and production. He also forecast that many Japanese companies will incorporate in Mexico during 2013, adding to the growth in motor production by groups such as Nissan, Mazda and Honda in 2012.

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