Foreign Direct Investment (FDI) in Mexico

Course summary Foreign Direct Investment (FDI) in Mexico:

Investment has grown in Mexico, due to its competitive costs compared to other countries, the advantage of its geographical location and its qualified labor.

In 2010, the FDI reached a value of $6,058 million USD, showing a growth of 688% compared with 2009. This was mostly due Heineken’s acquisition of FEMSA Beer. This is considered a growing sector in Mexico by the increase in consumption, the trends in health and the chances of producing a wide range of products.

In Mexico, the automotive sector represented 6% of the total direct foreign investment (FDI) in 2010. This shows that the country is an attractive destination for investment in the sector. Important companies like VW, Fiat, Jatco, Daimler, Pirelli and GM announced investments of more than 4,000 million USD for the manufacture of complete vehicles, engines and transmissions, among others. During 2010, investment in the auto parts sector reached a total of 400 million USD and generated 530,000 job opportunities.

The Foreign Direct Investment (FDI) of the medical devices industry rose to 927.5 million USD in the 1999-2010 period. According to SE, Mexico’s medical device industry captured 927.5 million dollars in foreign direct investment from 1999 to 2010. The main investing countries in the industry were the United States, Switzerland, Germany and The Netherlands.

In 2010 Mexico ranked 2nd place in Latin America as an investment destination with 23% of the total in software projects in the region. The projects were located mainly in Monterrey, Guadalajara and Mexico City.

In 2010, the largest food group in the world invested $390 million dollars to increase the productive capacity of its plant in Toluca, in the State of Mexico. According to Nestlé, this investment created the largest plant to process soluble coffee in the world.

Example of the course Foreign Direct Investment (FDI) in Mexico:

In the 1994-2007 1st quarter period, the Foreign direct investment (FDI) accumulated was US$210.4 billions. The annual average FDI is US$16.2 billion, where almost 56% of Mexico´s FDI originates in the United States. There are over 16,000 foreign companies established in Mexico, where they enjoy a big local market and a solid platform for boosting their exports.

Foreign direct investment had a very favorable performance for Mexico prompted by the negotiation of Free trade agreements, the tax discord with the in bond assembling industry, new changes in the PITEX and Maquila programs. Free trade agreements with 43 countries in the world have favored FDI. During the time of Free trade agreement negotiations the United States ranks first (56.3%), followed by the Netherlands (10.8%), Spain (10.0%), the United Kingdom (4.2%), Canada (3.4%), Germany (2.7%), Japan (2.1%) and Switzerland (1.6%).