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Photo credit: Pirate Ship, Puerto Vallarta, Mexico by SMcGarnigle

Mexico is a country that’s got its problems, and there is no way to sugar-coat them.  Yes, there are drug cartels, crime syndicates, corruption in the government and a weak rule of law in some places.  However, Mexico is poised to become one of the more dominant economic powers this century, and more and more investors, both domestic and foreign, are realising that Mexico’s solid economic growth of the past few years will only continue to expand.

When it comes to total economic clout, Mexico won’t be able to challenge India or China simply due to numbers; Mexico’s 112 million population is a tiny fraction of the billion-plus populations of the two Asian countries.   However, what Mexico offers investors is considered by many economics experts to be vastly superior.   What has happened is that metaphorically speaking, Mexico is open for business.

Mexico, in an effort not to be defined and overshadowed by it negatives, has signed 44 free trade agreements, more than any other country on the globe.  It has twice as many free trade agreements as China, and four times more agreements than South American rival Brazil.  Making things even more interesting for investors is the fact that Mexican universities and technological institutes are producing vast numbers of highly skilled workers and engineers who are not only capable of working, they’re capable of innovation and finding ways to make things run in an incredibly efficient manner.

There is also the matter of the recent natural gas finds in Mexico, which can significantly reduce transportation costs.  This, along with the fact that wages and product transit costs are on the rise in China, make Mexico one of the hottest countries for investment.  Manufacturing industries that went to Asia when it was cheaper are finding their way back to the Spanish-speaking North American country, and due to the amount of solidly educated, innovative skilled workers, high-tech industries are also hoping to establish plants and headquarters there.   Automotive and aerospace industries are flourishing at present and are expecting solid, continuous growth.

However, there is one recent development that may encourage massive amounts of investment in the country; the current government of President Enrique Peña Nieto, is working with all three of Mexico’s big political parties to fight the massive energy, telecom and teacher monopolies that some say have held back the country’s economic growth.  If these monopolies get broken, the possibilities for investors in the field of telecommunications and energy may become too numerous to count.

To summarise, in the 1990’s and 2000’s, when many of the foreign companies operating in Mexico up and let for the then-cheaper Asia, Mexico’s citizens did not waste their time; producing a skilled workforce for industries other than textiles that was innovative and efficient became key.

From aerospace industries and web-based start-ups to cloud computing and electrical engineering and a commitment to free trade, Mexico has got it all for investors and the only way to go for the foreseeable future is up.


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