I am reading your mind and you are thinking “Mexico has always been the next big growth market - and it always will be”. And now you are probably going … Mexico yawn,…yawn,…yawn. But important things are changing in Mexico and it may be time to wake up now in order not to be late.

I know, Mexico is currently not mentioned in one sentence together with Brazil, China and India when global economic growth engines are being discussed. You may even associate Mexico more with drug violence and illegal immigration.

But see what is changing now that may finally enable Mexico to materialize on its tremendous growth potential.

Few international investors took notice when Mexico changed its laws so that Mexican pension funds now can invest in PE. Consequently, lots of new PE and VC funds are emerging and a strong professional investment community is growing. In order to facilitate the exit of private investments the Mexican stock exchange has recently created a small and medium-cap alternative market.

The economy is currently growing at 5% with low unemployment, low public debt and high currency reserves. The country has a very robust banking system as a consequence of the economic crisis in 1994. As a result, there was no banking failure in Mexico in the last years.

China has been the major competitor to Mexico for US manufacturing work. Chinas competitiveness, however, has been inflated by lower labor and environmental standards as well as restrictive exchange rate policies. Labor and environmental standards are improving in China and the current exchange rate will not be sustainable over the long run. That will make Mexico relative to China more competitive again. 

Politically, the long overdue structural changes to labor laws, fiscal policy, education, etc. become more and more likely to materialize over the course of the coming years. It is widely expected that some of the pending reforms have the potential to add more than 1% to Mexico’s GDP.

There is no doubt that Mexico has still some major challenges to overcome. I have been living in Mexico for a few years now and it is sometimes difficult to see past crime, corruption and poverty.

But despite all the unwanted distractions it becomes more and more apparent that many enablers for fast economic growth are starting to line up. If you want to be positioned in Mexico while conditions are still very favorable you may want to take a look at investment opportunities now.

Best success, and if you need any help, let me know!

Michael Waschnig

VentureBull Mexico

Skype: michael.waschnig

Phone: (+52) 844 431 6134

Email: michael.waschnig@venturebull.com

http://www.venturebull.com Banca de Inversión en Mexico

http://www.elnegositio.com Venta y Traspaso de Negocios y Franquicias en México