Introduction to Nuevo León’s Investment Performance
Nuevo León, a Mexican state known for its robust industrial sector, has attracted $2.7 billion in Foreign Direct Investment (FDI) during the first quarter of 2023. This amount represents 13% of the total national FDI and marks a 65.5% increase compared to the same period in the previous year, as reported by Emmanuel Loo, the interim head of the state’s Secretariat of Economics.
Nuevo León’s Ranking Among Mexican States
At the national level, Nuevo León secured the second position for attracting FDI, just behind the Mexico City with $11.8 billion (55%). Following Nuevo León are the State of Mexico with $1.9 billion (9%), Baja California with $0.9 billion (4%), and Guanajuato with $0.7 billion, according to the federal Secretariat of Economics.
Year-to-Date Investment Announcements
As of now, the investment announcements in Nuevo León have surpassed $9 billion, as per Emmanuel Loo. However, it’s essential to understand that the National Registry of Foreign Investments may not always reflect the true magnitude of these figures.
Understanding Investment Figures
Loo explained that certain activities, such as renting industrial premises or purchasing equipment from abroad and paying for it through foreign subsidiaries, are not captured as capital expenditure (Capex) in Mexico. This discrepancy arises due to varying methodologies employed by the Secretariat of Economics and differing accounting standards across countries.
Leading Investors in Nuevo León
By the fourth quarter of 2024, the United States remained the primary investor in Nuevo León, accounting for 40% of total flows. South Korea followed with 30%, the Netherlands with 19%, and other nations contributing 11%. These statistics are based on Data Nuevo León.
FDI Distribution by Industry
By the end of the previous year, Nuevo León’s FDI totaled $2.098 billion, with 64% allocated to the commerce sector, 28% to manufacturing, and 4% to financial services, according to Data México.
Maintaining FDI Inflow
Emmanuel Loo confirmed that the state’s Secretariat of Economics continues to receive numerous inquiries from interested companies. He emphasized that they are cautious about disclosing future plans until companies provide the green light.
Plan México and Economic Development Poles
Marcelo Ebrard Casaubón, the Secretary of Economics, highlighted that during Q1, a new historical maximum was reached in FDI capture, totaling $21.4 billion with a 5.4% variation compared to the same period last year, despite uncertainties surrounding tariffs.
Strategic Sector Development in Nuevo León
Clelia Hernández, Director General of the Nuevo León 4.0 initiative, mentioned that the state is proactively preparing for this strategy by focusing on strategic sectors such as automotive, aerospace, energy, and home appliances. Additionally, they are working on developing semiconductor production in Mexico by training teachers across various stages of development.
Key Questions and Answers
- What is FDI? Foreign Direct Investment (FDI) refers to the investment made by a firm or individual in one country into another. It involves establishing economic operations or acquiring significant management influence over a foreign company.
- Why is Nuevo León attracting substantial FDI? Nuevo León’s robust industrial sector, strategic location, and business-friendly environment have made it an attractive destination for both domestic and foreign investors.
- What are the leading industries in Nuevo León? The primary sectors attracting FDI in Nuevo León are commerce, manufacturing, and financial services.
- What is Plan México? Plan México is a strategy implemented by the Mexican government to foster economic development and competitiveness, identifying specific regions as Economic Development Poles (Polos de Desarrollo Económico).
- What sectors is Nuevo León focusing on for future growth? Nuevo León is concentrating on automotive, aerospace, energy, home appliances, and semiconductor production to ensure sustainable growth.
