Is the climate welcoming for international companies?
Seeking to improve its economy and the standard of living for its 122 million citizens, Mexico is undergoing a massive transformation as it courts foreign investors and an array of trade partners. It has embarked on an ambitious agenda of domestic reforms—opening the oil sector to private investors for the first time in 76 years, breaking up telecommunications monopolies and modernizing education, as well as overhauling outdated infrastructure and cultivating a portfolio of free-trade agreements. The result has been a boom in trade and investment in the world's 11th largest economy. But the country faces notable challenges, chiefly high rates of violent crime, endemic corruption, a wide gap in wealth distribution and an underskilled workforce. Experts say Mexico's potential as an economic powerhouse will continue to go unfulfilled unless those pressing social issues can be reined in. Among the questions of concern for international business: Is labor cost-effective in Mexico? Is it safe to operate there? Does Mexico offer investors sufficient and reliable infrastructure?
Holmes, Cameron H., “Organized Crime in Mexico: Assessing the Threat to North American Economies,” Potomac Books, 2014. A prosecutor examines how drug cartels are threatening democracy and the economy in Mexico and the United States.
Morton, Adam David, “Revolution and State in Modern Mexico: The Political Economy of Uneven Development,” Rowman & Littlefield Publishers, 2013. A professor of political economy at the University of Sydney details the development of modern Mexico from Marxist revolutionary beginnings to capitalism.
O'Neil, Shannon K., “Two Nations Indivisible: Mexico, the United States and the Road Ahead,” Oxford University Press, 2013. A Latin America scholar at the Council on Foreign Relations looks at the history of U.S.-Mexico relations, and projects the future.
Pearce, Kenneth, “A Traveller's History of Mexico,” Interlink Books, 2002. An author surveys Mexican history from pre-Columbian times to the present.
Althaus, Dudley, and William Boston, “Why Automakers Are Building Factories in Mexico, not the U.S.,” The Wall Street Journal, March 17, 2015, http://tinyurl.com/
Anderson, Chris, “Mexico: The New China,” The New York Times, Jan. 26, 2013, http://tinyurl.com/
Nehro, Diana J., “Mexico Labor Reforms Increase Protections for Employees and Clarity for Employers,” Society for Human Resource Management, Feb. 12, 2013, http://tinyurl.com/
Priddle, Alisa, and Brent Snavely, “Why Mexico is winning the auto jobs war,” Detroit Free Press, June 14, 2015, http://tinyurl.com/
Reports and Studies
“Doing Business in Mexico: Automotive Industry,” PricewaterhouseCoopers Mexico, September 2014, http://tinyurl.com/
“Foreign Direct Investment in Mexico: Is Your Investment Safe?” American Chamber of Commerce of Mexico, June 2010, http://tinyurl.com/
Baron, Jay, Brian Esterberg and Bernard Swiecki, “Accelerating the Growth of the U.S. Automotive Manufacturing Industry at Home, Rather than Abroad,” Center for Automotive Research, 2014, http://tinyurl.com/
Díaz-Cayceros, Alberto, Beatriz Magaloni and Vidal Romero, “Caught in the Crossfire: The Geography of Extortion and Police Corruption in Mexico,” Stanford University, February 2014, http://tinyurl.com/
Díaz-Cayceros, Alberto, et al., “Living in Fear: The Dynamics of Extortion in Mexico's Criminal Insurgency,” Stanford University, February 2014, http://tinyurl.com/
O'Neil, Shannon K., “What does the TPP Mean for Latin America?” Council on Foreign Relations, May 19, 2015, http://tinyurl.com/
O'Neil, Shannon K., and Gilberto García, “Economic Clusters, Productivity, and Growth in Latin America,” Council on Foreign Relations, June 9, 2015, http://tinyurl.com/
Robles, Gustavo, Gabriela Calderón and Beatriz Magaloni, “The Economic Costs of Drug Trafficking Violence in Mexico,” Stanford University, December 2013, http://tinyurl.com/
The Next Step
Bogler, Dan, “Crime and punishment: Mexico suffers the costs of lawlessness,” Financial Times, June 15, 2015, http://tinyurl.com/
Guilbert, Kieran, “Mexico sees fall in violence, despite drug war: index,” Thomson Reuters Foundation, March 19, 2015, http://tinyurl.com/
MacDonald, Alistair, and Dudley Althaus, “Mining Companies Face Dangers From Criminal Gangs in Mexico,” The Wall Street Journal, April 10, 2015, http://tinyurl.com/
Dibble, Sandra, “It's Mexico's turn to boost border enforcement—with a new pedestrian crossing into Tijuana,” Los Angeles Times, Aug. 26, 2015, http://tinyurl.com/
Martin, Eric, Andrea Navarro and Adam Williams, “Mexico's CFE Sees Infrastructure Spending Near $16.6 Billion,” Bloomberg Business, May 8, 2015, http://tinyurl.com/
Toonkel, Jessica, and Christine Murray, “Private investors look but do not leap at Mexican energy projects,” Reuters, June 9, 2015, http://tinyurl.com/
Choi, Candice, “Trump vows never to eat Oreos again, citing move to Mexico,” The Associated Press, Aug. 25, 2015, http://tinyurl.com/
Krisher, Tom, “Preserving jobs, pay raises on table as US auto talks open,” The Associated Press, July 8, 2015, http://tinyurl.com/
Woody, Christopher, “Mexico's wage crisis is so bad ‘that it violates what's stipulated in the Constitution,’” Business Insider, Aug. 2, 2015, http://tinyurl.com/
Case, Brendan, and Eric Smith, “Mexico Cuts Growth Forecast on Oil, U.S. Industrial Output,” Bloomberg Business, Aug. 20, 2015, http://tinyurl.com/
Krauss, Clifford, “U.S. Allows Limited Oil Exports to Mexico,” The New York Times, Aug. 14, 2015, http://tinyurl.com/
Osborne, James, “As Mexico makes history, oil industry largely stays away,” The Dallas Morning News, July 15, 2015, http://tinyurl.com/
ORGANIZATIONS TO CONTACT
American Chamber of Commerce of Mexico
Blas Pascal 205, 3.er piso, Col. Los Morales, 11510 Mexico City
Business advocacy organization representing international companies operating in Mexico; counterpart groups are in Costa Rica, El Salvador, Guatemala and Honduras.
Caribbean-Central American Action
1625 K St., N.W., Suite 200, Washington, DC 20006
Promotes private-sector-generated economic development, trade, investment and business policies in the Caribbean and Central America.
Center for International Private Enterprise
1211 Connecticut Ave., N.W., Suite 700, Washington, DC 20036
Advocacy group that works to build democracy and market economies throughout the world; also monitors issues and policies of business interest.
Council of the Americas
1615 L St., N.W., Suite 250, Washington, D.C. 20036
Analyzes economic and political issues affecting businesses in Latin America.
Export-Import Bank of the United States
811 Vermont Ave., N.W., Washington, DC 20571
U.S. government agency that helps finance the overseas sales of U.S. goods and services.
International Trade Administration, U.S. Department of Commerce
1401 Constitution Ave., N.W., Washington, D.C. 20230
U.S. government agency that offers information on all aspects of overseas business, including exporting, international sales, logistics, finance, intellectual property protection, trade dispute resolutions.
International Trade and Investment Division, U.S. Chamber of Commerce
1615 H St., N.W., Washington, DC 20062-2000
Chamber's trade and investment division that offers information on doing business abroad; also represents U.S. business interests in trade policy issues and negotiations.
North American Development Bank
203 South St. Mary's, Suite 300, San Antonio, TX 78205
International financial institution formed by the governments of United States and Mexico for financing infrastructure projects along the shared border.
The Trust for the Americas
2600 16th St., N.W., 4th Floor, Washington, D.C. 20006
An agency of the Organization of American States that promotes private-sector participation in economic-opportunity projects for the region's most disenfranchised.
United States-Mexico Chamber of Commerce
6800 Versar Center Drive, Suite 450, Springfield, VA 22151
Business group that helps bridge legal, economic and regulatory differences for investors.