Mexico has a promising prospect of attracting foreign investment
The Mexican Ministry of Economy recently released preliminary statistical data showing that in 2023, Mexico attracted a foreign direct investment of 36.058 billion US dollars, a year-on-year increase of 2.2%, setting a new historical high.
According to data from the Mexican Ministry of Economy, the capital city of Mexico City is the main destination for foreign direct investment, attracting 31% of the total foreign direct investment. The northern states of Sonora and Nuevo Leon account for 8% and 7% respectively, while the rest of the investment mainly flows to regions such as Jalisco, Chihuahua, and Mexico.
From the perspective of investment areas, 50% of the foreign direct investment attracted by Mexico last year was concentrated in the manufacturing industry, including transportation equipment manufacturing, metal industry, electronic product manufacturing, chemical industry, etc. The remaining investments mainly flow into areas such as mining, finance, and services.
The Mexican Ministry of Economy has released a report stating that stable macroeconomic conditions, competitive advantages, and a favorable business environment are important reasons for Mexico to attract foreign investment. Especially in 2023, 74% of foreign direct investment was reinvested from profits earned by investors within Mexico, indicating the confidence of foreign investors in Mexico.
In recent years, Mexico has attracted a large number of foreign investors due to its advantages in location, labor resources, and huge potential in the market. Last year, the Mexican government issued a decree providing tax breaks ranging from 56% to 89% for key enterprises investing in major export industries such as automobiles, semiconductors, electrical and electronic, medical devices, and pharmaceuticals in the fiscal years 2023 and 2024. In addition, relevant enterprises can also enjoy an additional deduction of talent training expenses for 3 years, with a deduction ratio of 25%.
The Mexican Ministry of Finance and Public Credit stated that fiscal stimulus measures targeting major export industries can enhance the competitiveness of related industries, promote technological innovation and investment, help create employment opportunities, and further attract foreign direct investment. In addition, expanding exports helps to increase foreign exchange income and improve trade balance, further enhancing investor confidence in Mexico.
Francisco Cervantes, Chairman of the Mexican Entrepreneurs Coordinating Council, stated that although Mexico has attracted foreign direct investment and overall promising economic development prospects, there are still some challenges. In the future, the country needs to further strengthen infrastructure construction such as transportation, attach importance to technological development and talent cultivation.