Mexico Economic Outlook and Competitive Advantages

Mexico Economic Outlook

• Mexico's economy is expected to grow in global terms and be a key player in the global economy.
• GDP in 2020 was $1.27 trillion.
• Mexico has a strong manufacturing sector and is a major exporter.
• Mexico is a member of the North American Free Trade Agreement (NAFTA).
• Mexico is a member of the World Trade Organization (WTO).
• Mexico has a strong workforce and is attracting Foreign Direct Investment (FDI).

Mexico’s Competitive Advantages

• Strong institutions and legislation.
• Strong labor and talent market.
• Attractive location (Mexico is strategically placed between the US and South America).
• Abundant natural resources.
• Strong culture and values.
• Strong partnerships with key players.
• Large domestic market.
• Extensive supply chains.

Mexico’s Automotive Industry

• The automotive industry is a major contributor to the economy.
• Mexico is a key player in the global automotive supply chains for internal combustion engines.
• Investment in EV auto parts is predicted to reach $15 billion.
• 8 OEM plants are currently assembling or planning the production of EVs in Mexico.
• Some OEM plants include, General Motors, Ford Motor Co, Stellantis, BMW, KIA, Tesla, Volkswagen and Nissan.

### Mexico’s Challenges

• Regional diversification of exports.
• Development coordination between north and south regions.
• High value-added economic sectors.
• Energy Infrastructure.
• Water shortages.
• Housing shortage.
• Insecurity and operational costs (estimated 2% to 3% increase).
• Low-skilled workforce and remuneration.
• Corruption.
• Rule of law.