Mexico’s Economy Ministry announced that foreign direct investment (FDI) rose 180 percent in 2013 to hit more than $35.2 billion. This number was bolstered in part by the buyout of Mexican beer giant Grupo Modelo by Belgian brewer Anheuser-Busch, which accounted for $13.2 billion of last year’s total.
“Foreign companies invested more in Mexico last year than in 2012,” writes the Wall Street Journal. “Three quarters of the foreign direct investment was in manufacturing, with mining, commerce, hotels and construction receiving smaller amounts.”
The Modelo buyout made Belgium Mexico’s largest foreign investor last year, followed closely by the U.S. and Japan, with nearly half of the 2014 total coming from new investments. In addition, the ministry announced that FDI during the fourth quarter of 2013 hit $5.42 billion, which represents an increase of 138 percent from the fourth quarter average over the last decade.
Since 2000,FDI has averaged around $23 billion annually in Mexico, but the landslide of progressive economic and structural reforms pushed through Congress last year by President Enrique Peña Nieto has attracted a wealth of new investors. In addition,Mexico’s FDI numbers are expected to remain at record highs in the coming years as the reforms are fully implemented and their impacts are felt, especially in the energy and telecom sectors, as Mexico’s economic growth continues.
“Private economists surveyed in January by the Bank of Mexico forecast on average that FDI would exceed $26 billion this year and $30 billion in 2015,” writes the Wall Street Journal.
BBVA Bancomer predicts that Mexico’s economy will grow by at least 3.4 percent in 2014, citing rising consumer demand, stronger exports and an increase in government spending. For example, infrastructure spending will increase dramatically in 2014, with a large portion of the federal budget dedicated to building or improving roads, ports and railways, along with a variety of other projects. As a result, the gross domestic product (GDP) will also expand, with a balanced budget returning by 2017 to ensure fiscal stability in Latin America’s second largest economy.