Mexico manufacturing growth outpaces other sectors
Thus far in 2014, manufacturing growth in Mexico outpaces that in other areas of the national economy.
Although after two quarters in 2014, the nation registered an overall modest 1.6% hike in GDP, Mexico manufacturing growth progressed at a rate of 2.6%. The gains that have been made in the manufacturing sector in Mexico have occurred, principally, as the result of the country’s ability to capture foreign direct investment (FDI) aimed at industry.
According to United Nations Conference on Trade and Development (UNCTAD) global investment data, seventy percent of FDI flowing into the country has been for the purpose of expanding Mexico manufacturing, for both ongoing and newly established projects in the sector.
As would be expected, increased FDI-driven Mexico manufacturing growth has created more postions for factory workers. At the beginning of the third quarter of this year, manufacturing employment in Mexico had risen at a two and one-half percent clip, when compared to numbers from one year prior.
Mexico’s Secretariat of the Economy reports that the breakdown of foreign direct investment that has been captured by Mexico, broken down by economic activity, is as such:
- Manufacturing US $6.9 million
- Financial Services US $1.9 million
- Retail Trade US $1.2 million
- Mining US $853,600
- Construction US $611,800
- Other Activities US $1.8 million
According to officials at the Confederation of Industrial Chambers (Concamin), Mexico manufacturing growth during the first half of the present year has been due to three factors, in particular:
- Significant growth of Mexico’s domestic market for goods
- Strong and proactive industrial policies
- Increased support for small and medium-sized businesses
Francisco Funtanet, the president of Concamin, believes that the recently passed law aimed at promoting “Sustained Growth and Economic Competitiveness” has been a positive factor in producing the growth figures registered by the Mexico manufacturing sector thus far in 2014. According to Funtanet, the legislation has provided Mexico with “pillars upon which new foundations can be built to speed investment activity and economic growth.”
Read the primary source for this post in its original Spanish at El Horizonte.
Growth of 6 percent and 10 other economic goals of the Mexican National Development Plan for 2019-2024