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Mexico’s Foreign Direct Investment Hits Six-Year High in 2013

23 June, 2013

Mexico has released its numbers for foreign direct investment (FDI) during the first quarter of 2013,which hit $4.99 billion,reaching a six-year high thanks in large part to rising investments from the United States and a booming manufacturing sector. By comparison,FDI for the period from January to March of 2012 was around $4.37 billion.

“Foreigners poured $4.99 billion into Latin America’s No. 2 economy in the first quarter,up 14 percent from last year and the highest investment since 2007,” writes Reuters. “The figure tracks investments of 767 foreign companies [and] is dominated by flows into the manufacturing sector,which received 65 percent of the total.”

This year’s figure is also 22 percent higher than the average figures for the first quarter of each of the last five years,according to preliminary estimates from Mexico’s Economy Ministry. Although the United States accounts for 49 percent of the total FDI so far this year,Germany,Japan and Spain have also invested significant sums,at 12 percent,11 percent and 7 percent,respectively.

“The ministry also announced an upwardly revised $13.43 billion in FDI for 2012,up from the previously reported $12.66 billion,” writes Reuters.

It is important to note that FDI numbers are typically revised higher as time goes by and more ongoing investments are logged with the National Registry of Foreign Investment. So far,the 2013 numbers mostly reflect reinvested profits and inter-company accounts.

In other sectors,this year’s figure includes 18 percent in commerce,4 percent in professional services,3 percent in mining and 2 percent in construction,followed by 8 percent that is spread among a variety of different economic sectors,including Mexico real estate. The Netherlands contributed 6 percent of the total FDI so far this year,followed by 15 percent,which came from 47 different countries.

The healthy boost to Mexico’s FDI that has already been recorded this year serves to farther underscore the growing level of confidence among international corporations and individual investors,who are increasingly being drawn to all that Mexico has to offer. In other positive news,rising optimism due to President Enrique Peña Nieto’s promised economic reforms has bolstered the peso in recent months.

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