Spanish Companies Building New Opportunities in MexicoBy Jan Hogewoning | Wed, 11/13/2019 - 11:07
Spanish companies have built a solid presence in foreign direct investment to Mexico, setting a particularly strong footprint in the country’s infrastructure industry, Antonio Basagoiti, President of the Spanish Chamber of Commerce in Mexico, said in his opening presentation at the Mexico Infrastructure & Sustainability Summit 2019 at the Hotel Marquis in Mexico City on Wednesday.
Spain accounts for 12 percent of all FDI to Mexico, making it the second-biggest investor in the country. This includes large international companies, small to medium-sized businesses, including family businesses, and public bodies. Of all foreign investment in Mexican infrastructure, 24 percent is of Spanish origin. “This shows our commitment to this country is for the long term,” Basagoiti said.
Basagoiti recognizes that there have been recent challenges to foreign investors. Large infrastructure projects have been a subject of political battles. But he pointed out that the new government is also setting an ambitious agenda of new projects, which include the Santa Lucia airport, the remodeling of the current international airport of Mexico City, the Maya Train project, the goal to connect the coasts of the Isthmus of Tehuantepec, the new ports of Veracruz and Lazaro Cardenas, and the modernization of various federal highways. “Significantly, this government has also stated its intention to complete highways that remained unfinished under previous administrations, like the road between Oaxaca and Escondido. Together, these projects would mark the biggest infrastructure investment in 24 years,” he said.
Adapting to the new direction is a challenge but one that Spanish companies will take on, he added. “Spanish companies working in Mexico will adapt to current strategies for the development of Mexico.” He also highlighted that the “Spanish private sector continues to look at Mexico as a prime investment destination. The technology behind the Tren Maya is Spanish.”
Spanish companies have built a formidable reputation in infrastructure bec ause the sector experienced rapid growth and consolidation in Spain over the last few decades. Companies which built a lot of capacity and experience are now finding opportunity abroad, Basagoiti said. Among the renowned international projects managed by Spanish companies are the newest tunnels in Istanbul, bridge projects in the UK, the Lima and Ryadh metros and various international airports. Basagoiti also pointed out that Spanish companies can contribute in the engineering stage, the construction work, and the financing of projects. Examples of Mexican projects that have had Spanish participation are the Maya Train and the Western Highway Toll network. Basagoiti was also keen to point out that Spanish companies, and the chamber itself, are always looking to work with local businesses and employ Mexican nationals. “The willingness to share experience and commit to working with a local workforce is not always the case for international companies, but for our members it is a primary objective,” he said.
Another area which is high on the chamber’s agenda is to foment ethical business practices which promote social development and a conscious environmental footprint. “These days, companies are more and more concerned with doing things in a clean manner, using their projects to improve the living conditions of the communities who live in the areas,” he said. This is a goal his chamber always tables in its meetings with private and public bodies. With a presence in Monterrey, the Bajio region, Cancun and Mexico City, the chamber holds frequent discussions with government entities at different levels. Basagoiti recognizes that the Mexican government has the sovereignty to make its own decisions, but he hopes the industry can move toward the adoption of international standards that provide clarity and continuity. “Carrying out infrastructure projects is not enough today. They must be done ethically, transparently and efficiently.”
In his closing words, Basagoiti emphasized Mexico’s bright future. Apart from the projects announced by the government, there are many more areas which will provide opportunities. Mexico has a very favorable geographical location and remains open for international business. He also reiterated the obligation of the sector to contribute to social development and help conserve the country’s rich cultural heritage. “Mexico will inevitably grow if the right measures are taken,” he said. “Spanish companies are key partners to detonate the country’s potential.”