Introduction
As a global consultant, it’s crucial to maintain a global and strategic perspective to identify new synergies and sources of competitive advantage, as well as anticipate potential issues that could derail agreements or even national projects. Born in Romania and a global traveler by vocation, I observe similar challenges in both the Americas and Eastern Europe: an excessive dependence on a particularly strong regional economy, lack of diversification, need for additional sources of value addition, and unrealized diplomatic potential in a world still structured by its key players.
Post-War Ukraine Impact and the Middle-Income Trap
My primary concern, following the impact of the war in Ukraine, is that Romania and other countries may fall into what’s known as the “middle-income trap,” meaning they fail to move beyond economic models that have brought them this far but have exhausted their potential. Countries trapped in this cycle face significant difficulties in escaping: stagnation intensifies political disputes over a fixed pie and hinders the implementation of necessary reforms as well as support for businesses and entrepreneurs to steer the economy towards the tertiary sector and higher value-added activities.
The “Romanian Global” Vision
My response to Romanian businesses and policymakers is the vision of a “Romanian Global,” a set of initiatives through which national champions internationalize and ultimately globalize. This effort would make labor costs no longer the determining factor of competitiveness, and Romania would mobilize all its resources and value-added sources, including innovation capacity, brand potential, and economic diplomacy worldwide.
The “Red Latina” Global Network
One of these initiatives is based on the “Red Latina” global network, a broad space of countries sharing Latin-rooted languages, compatible cultures (or at least shared cultural expectations), and the derived fluidity from a common history. This enables triangular commercial and project collaborations through a third country, made possible by extensive diasporas, a comparative advantage in cultural mapping, and the flexibility and agility characteristic of our rapidly developing economies. This Latin space includes Spanish-speaking, French-speaking, and Portuguese-speaking countries, as well as those preserving significant competencies and historical memory, like Marrakech with Spanish and French or Somalia and Eritrea with Italian.
Common Characteristics of “Red Latina” Members
Members of this network share common traits: hierarchical organizations, the importance of interpersonal relationships in business, the role of family- and diaspora-based business networks, and the combination of family businesses and professional management. Often viewed negatively, these traits also represent strengths and a valid foundation for building, aligning interests of shareholders and management in the long term. Through the “Red Latina,” we can accelerate the internationalization of our leading companies, create mechanisms to reduce information asymmetry between countries and national business communities, and utilize triangular cooperation formulas to access new markets.
Romania and Mexico: Cultural Mapping Similarities
Romania and Mexico share similar capabilities in cultural mapping. Often perceived as hospitality accompanied by personal warmth and friendship, this is merely the surface interpretation of a true capacity to generate socially positive interactions based on flexibility, pluralism, non-aggressive cultural or identity conflict, and mutual respect. These interactions can lead to trade and investment opportunities but also learning by observing successful models from other countries and adapting them to local conditions.
Trade and Investment Between Romania and Mexico
Although trade between Romania and Mexico has grown from a low base, the economic similarities limiting complementary trade have already spawned various transboundary investment initiatives. Mexico holds solid positions in Romania, such as Sigma Alimentos’ acquisition of Caroli or Bimbo’s purchase of Vel Pitar. The anticipated entry of Nemak, a global automotive giant and world leader in aluminum components, into Romania through the acquisition of Georg Fischer (GF) operations is another illustrative case.
On the Romanian side, notable examples include Alexandrion’s joint venture with Casa Aceves of Jalisco to incorporate tequila into their portfolio, Amber’s opening of a mobile video game development studio in Guadalajara, UiPath’s base in Mexico City for its Latin American operations, and Bitdefender’s expansion in the Mexican market. All these examples confirm Mexico’s appeal in Romania, not just for its growing domestic market but also as a platform for expansion in Latin America and, eventually, serving other North American markets with their burgeoning Latino segments.
Mexico’s Economic and Political Dynamism
Currently, Mexico experiences significant economic and political dynamism, marked by nearshoring policies to attract advanced manufacturing, the launch of Plan Mexico to diversify the economy, and the introduction of strategic tariffs to protect key sectors from Asian competition. Additionally, large-scale infrastructure projects like the Manzanillo port expansion or the Tehuantepec Interoceanic Corridor, connecting the Pacific and Atlantic through ports, railway, and industrial parks, strengthen Mexico’s competitiveness and global logistical capacity while opening concrete cooperation opportunities within the “Red Latina” framework. These developments allow Romanian and Eastern European companies to integrate into new value chains and actively participate in transforming Mexico into a regional reference hub.
Strategic Cooperation Dimension
Romania and Mexico can achieve a strategic dimension in their cooperation. Mexico already serves as a base for regional expansion; Romania can play the same role in Eastern Europe. Their traditional links with Africa and the Middle East can also facilitate business contacts and new expansion opportunities for Mexican interests. Moreover, both Romania and Mexico are benign geopolitical actors, with cooperation not carrying any hidden geopolitical subtext or systemic implications. Many countries seek to diversify their investments and economic relations with “non-problematic” partners, which also opens the door to cooperate on common regulatory agendas. A notable area is cybersecurity, where responses to challenges like integrating emerging technologies (e.g., artificial intelligence) must consider the interests and perspectives of the international community, not just those of leading tech powers like the US or China.
Triangular Approach with Knowledge Producers
Within the “Red Latina,” I envision an additional triangular approach: goods and service producers supported by knowledge producers (embassies, universities, consultancies) fostering innovation of new products and services while generating business intelligence to ensure successful expansion. This must be supported by local communities, business forums, industrial and sectorial associations, and state initiatives reducing the aversion to risk.
Growth: Quantitative and Qualitative
Growth is not merely quantitative but also qualitative. By internationalizing key companies, our countries can secure a solid base for growth beyond the critical point of the middle-income trap. This enables continued funding of state programs, lifting more people out of poverty, and converging with developed economies that have traversed this very path.
Radu Magdin served as an honorary advisor to the Romanian Prime Minister (2014-2015) and the Moldovan Prime Minister (2016-2017). He currently works as a global analyst and consultant.
