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China Invests $2.4 Billion in Mexico

07 July, 2015

The new $2.4 billion investment fund will reportedly support a variety of energy,infrastructure,technology,tourism and mining projects,according to Mexican President Enrique Pena Nieto,who met with Chinese President Xi Jinping late last week in Beijing.

“Now Mexico-China relations are broader,more stable,more productive and more beneficial for our people,” shared Pena Nieto at a press conference following the meeting. “Due to our unique geographical location,Mexico could become an important channel for China to enter the North America and Latin American markets.”

New China-Mexico Investment Deals

The two nations are reportedly also eyeing a lucrative oil deal that is worth at least $5 billion,wherein three Chinese firms would invest to finance projects like the Ramones pipeline for Pemex,Mexico’s state-run oil company. At the meetings the leaders signed 14 pacts,including a deal between the China Development Bank,Mexico’s Bancomex and Pemex to fund new petroleum projects,as well as agreements between the Industrial and Commercial Bank of China,Pemex and Chinese oil giant CNOOC.

“Since June 2013 when Chinese President Xi Jinping visited Mexico,the two countries have carried out frequent discussions over a possible trade pact,” writes China’s ECNS online news. “Currently,China is Mexico’s second-largest trading partner,while Mexico is China’s second-largest trading partner in Latin America.”

Xi said China welcomes more products from Mexico to the Chinese market and both leaders recognized the added potential for even more bilateral communication. To achieve continued progress,China will host the year of Mexican tourism and the second forum of Chinese and Mexican university presidents in 2015.

Click here to read about another recent trade deal to export tequila from Mexico to China.

Mexico Is Ripe for Investment

Also of note,Investopedia recently named Mexico one of the “best 4 places to invest,” citing its strategic geographic location,strong economy and the creation of the North American Free Trade Agreement (NAFTA). Now in its 21st year,NAFTA also incorporates Canada and the U.S.,which created the largest trade bloc in the world.

“Mexico-U.S. trade has more than quadrupled since the onset of the agreement,” writes Investopedia.

More than just beautiful resorts,colorful culture,fabulous tequila and excellent cuisine,Mexico is quickly emerging as a leader in economic growth,which also prompted Investopedia to recommend last week that investors worldwide to take a closer look at the iShares MSCI Mexico Capped ETF (EWW),which offers direct exposure to a broad range of Mexican companies. 

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