Overview of Mexico’s Investment Landscape
The Mexican government has announced that the current portfolio of long-term investments amounts to $298 billion, comprising 1,937 private projects registered across the country’s 32 states. The aim is to foster job creation, stimulate economic growth, and facilitate the establishment of new industries. This information was provided by Marcelo Ebrard, the Secretary of Economy.
Key Objectives
- Identify high-impact investment projects that generate employment
- Understand the requirements for successful investments
- Coordinate government departments and institutions to remove obstacles and facilitate execution
Ebrard Casaubón highlighted that the total investment amount registered is $298 billion, which represents about 16% of Mexico’s Gross Domestic Product (GDP). He emphasized that no projects have been canceled.
Challenges and Distribution
Out of these 1,937 projects, 446 face specific challenges related to water, environment, energy, and infrastructure. These issues are being addressed to ensure they progress at the same pace as other projects.
The projects are distributed across all states, with Baja California, Nuevo León, and Sonora leading in the number of registered investments. The industries involved include manufacturing, energy, water and gas, among others.
Economic Context
In the previous year, Mexico’s gross fixed capital formation equaled 24.2% of its GDP, the highest coefficient in the last 30 years. However, this did not prevent the economic growth from slowing down to 1.5% from 3.2% in the preceding year.
Mexico’s Attractiveness for Investments
Marcelo Ebrard affirmed that Mexico remains attractive for investments within the framework of the United States’ tariff policy. He pointed out that Mexico has the best comparative advantages so far.
The United States imposed a minimum tariff of 10% on all imports and sectoral tariffs of 25% on steel, aluminum, and automobiles. Although higher tariffs on imports from 57 countries were set to take effect on April 9, they were suspended for 90 days for all countries except China.
Comparative Advantage
Ebrard explained that the question now is, “Where is it cheaper to export to the United States?” Since tariffs must be paid, businesses need to consider the costs of exporting from different countries. He noted that Mexico has a 3% tariff on steel and aluminum, which accounts for only 77% of Mexico’s exports being tariff-free.
He further emphasized that while other countries face tariffs of 10%, 20%, or even 200%, Mexico offers a relatively smaller disadvantage in terms of comparative advantage.
Grupo Modelo’s Investment Announcement
One of the investments registered with the Secretariat of Economy is Grupo Modelo’s announcement of a $3.6 billion investment in Mexico between 2025 and 2027, as communicated by Raúl Escalante, the company’s Vice President of Corporate Affairs.
Commitment to Mexico
Escalante expressed pride in renewing their commitment to the country, stating that Grupo Modelo has been part of Mexico’s history for a century and will continue to be so. He mentioned that this investment aligns with the federal government’s “Plan Mexico” to promote economic development with social justice and sustainability.
Investment Focus
The investments will be allocated nationwide, particularly in states where Grupo Modelo’s plants are located, such as Zacatecas, Mexico City, Coahuila, and the southeastern regions of Tuxtepec, Oaxaca, and Hunucmá, Yucatán.
Escalante Martínez explained that the investments will focus on modernizing cerbreweries and factories to reduce water consumption.
Water Conservation Efforts
Over the past decade, Grupo Modelo has reduced water usage in beer production by 30%. The company has also ceded 20 million cubic meters of water concessions to the National Water Commission (Conagua).
Grupo Modelo aims to promote circular economy by increasing the use of returnable packaging and glass recycling programs. They will also support the 300,000 small retailers selling their products by providing technology, credits, and infrastructure improvements.
