Nearshoring, Exports: Growing Opportunities
Home > Finance & Fintech > Weekly Roundups

Nearshoring, Exports: Growing Opportunities

Share it!
Sofía Garduño By Sofía Garduño | Journalist & Industry Analyst - Thu, 12/22/2022 - 10:00

Fitch Ratings is expecting Mexico to grow 3 percent by the end of 2022. Meanwhile, BBVA highlighted that the country is not exploiting nearshoring as it should and is missing the opportunity of improving its manufacturing industry. For SMEs to overcome these turbulent economic times, Drip Capital’s Director suggests leveraging the current export boom.

 

This and more in the Week in Finance!

 

Mexico to Grow 3 Percent in 2022: Fitch Ratings

The Global Economic Outlook, presented by Fitch Ratings, forecasts further increases in interest rates by Mexico’s Central Bank (Banxico), leading to an economic slowdown in 2023. However, Fitch Ratings reformulated its previous growth forecasts for 2022, increasing its projection from 2.5 percent to 3 percent annual growth. “Banxico will continue to tighten its policies to avoid further de-anchoring of inflation expectations against the backdrop of stubbornly high inflation. We project that the policy rate will reach 10.50 percent by end-2022,” according to Fitch Ratings. Read the whole story on MBN.

 

Exports Can Help Mexican SMEs Face Next Year’s Hurdles

The strengthened relationship with our main trade partners has given origin to an export boom which is tipping the scales in our economy’s favor, despite the many remaining obstacles to sort through. For SMEs to leverage this opportunity, they need to compete with a wider range of suppliers and they need capital to build the infrastructure to fulfill bigger orders with industry standards expected by international buyers. “As we approach 2023, SMEs must go beyond a simple ‘aggressive’ plan to sell more. A smart strategy around their cash conversion cycle and investing in their own company will help them to be more resilient and to better prepare for international growth, but also to navigate adversity in the face of another complicated year for the world economy,” writes Edmundo Montaño, Director General, Drip Capital. 

 

Nearshoring Failure Cost Mexico 1.8 Percent Growth Opportunity 

Mexico has compromised significant growth due to not having a policy for attracting manufacturing activities through nearshoring, as reported by the BBVA Mexico “Regional Sectorial Situation” report. “These gains could have represented an additional growth of up to 15 percent per year in manufacturing exports, which would have allowed the manufacturing sector to grow up to 10 times more over the past four years,” reads the report. Read the complete article here

 

Revamping International Transactions With Technology

The traditional financial market is being disrupted thanks to technology and the changes brought about by the COVID-19 pandemic. “People now move money from bank to bank but technology can change that. Using Stablecoins, we can send money from the US and give the user almost the same amount (as they sent). Through this strategy, we are able to move traditional fiat money with tokens. Later, our local partner in Mexico allows the freelancer being paid to exchange their payment for cash, which makes the price of moving money almost zero,” explained Teymour Farman-Farmaian, CEO and Co-Founder, Higlobe. Read the whole interview here

 

Rappi Bets on NFTs

Rappi celebrates an alliance with Barcel and Alacua, looking to take the digital world and the benefits for its users even further. With Alacua, each Rappi user can open a Wallet where one of nine Non-Fungible Token (NFT) designs launched by Barcel will be stored. The objective of this alliance is to bring NFT closer to more people in Mexico and bring this technology to users who have shown interest in new digital assets. “Nowadays, the most recognized use of NFTs is the commercialization of art or digital collectibles, which are turning some people into new millionaires. But companies also use them to add value to their clients and generate other applications,” said Sebastián Romo, Managing Partners, Skala Ventures to MBN. Read the whole story here

You May Like

Most popular

Newsletter