Finance Minister Luis Videgaray said Mexico will build upon its progress over the last 12 months and will focus on locking down long-term economic growth and stability in 2014. This will include increasing loans to small and medium sized companies, as well as promoting greater competition across a variety of sectors. In addition, Mexico is reforming its existing mortgage and bankruptcy laws to boost real estate sales, while banks from around the world – including the U.K. and China – are opening up new offices in Mexico.
“Energy and finance reforms, among other measures, will help lay the foundations for the country’s future prosperity,” Videgaray told the Wall Street Journal.
In late 2013 Mexico announced that it expected the nation’s economy to grow by nearly 4 percent in 2014, along with an increase of around $9 trillion in its nominal GDP. In addition, Mexico is expected to export around 1.17 million barrels per day (bpd) of crude oil this year, while inflation will likely hover around 3 percent, down from 3.5 percent at the end of 2013.
Much of the growth is due to a series of progressive reforms that made history throughout 2013. As part of Mexico’s new National Development Plan (NDP), the reforms are helping the nation reach its full potential and are designed to boost key sectors of the economy. This includes overhauls in a variety of areas with the highest growth potential, such as energy, infrastructure, telecom and tourism, as well as manufacturing, real estate and banking.
“When the benefits of Mexico’s structural reforms kick in, it is likely to stand out as one of Latin America’s fastest growing economies,” writes MoneyWeek. “In the longer-term, as we enter this new phase of emerging market investment,Mexico will stand out and reward investors.”
By opening up its formerly state-run energy sector to outside investment and implementing a variety of additional structural reforms,Mexico’s institutions have become much more attractive to international businesses and investors. In fact, oil giants like ExxonMobile, Chevron, PetroChina and Statoil are already working to secure contracts that will allow them to begin exploring Mexico’s untapped oil and gas reserves.
“According to government estimates,Mexico contains proven, probable and possible reserves of more than 45 million barrels of oil and in excess of 500 trillion cubic feet of natural gas,” writes Forbes. “The reforms could trigger Mexico’s biggest economic boom in a century.”