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News Article

FDI Grows 4.2 Percent in President López Obrador's First Year

By Ricardo Guzman | Wed, 02/19/2020 - 17:22

Last year Mexico attracted US$32.9 billion (approx. MX$610.7 billion) in foreign direct investment (FDI) representing a 4.2 percent increase compared to 2018 results, the Ministry of Economy (SE) has reported. Figures recorded during President Andrés Manuel López Obrador's first year will be slightly adjusted when detailed information on the period’s results are available.

The SE, headed by Graciela Márquez, pointed out that last year’s FDI came from 4,353 foreign equity companies, 3,776 trust and 27 foreign companies.

On investment type (or origin of financing), SE reported that profits reinvestment accounted for 53.1 percent of the total investment amount, while new investments and accounts between companies accounted for 39 percent and 7.9 percent, respectively.

Among sectors, manufacturing received 47.2 percent of the total foreign investment while financial and insurance services received 15.3 percent, commerce 9.7 percent, mass media information 5.5 percent and mining 5.5 percent. The rest of the productive sectors shared the remaining 16.8 percent.

US companies accounted for 36.8 percent of Mexican FDI. Spain followed with 12.1 percent, Canada represented 9.7 percent, and Germany and Italy offered 9.2 percent and 4.5 percent, respectively. The remaining 27.7 percent was accounted for by various countries.

Juan Carlos Baker, former Foreign Trade Deputy Minister, told El Financiero that FDI expectations for 2020 are positive for two main reasons: First, the USMCA’s approval and imminent start “will be a great incentive for FDI”. The second reason is the many infrastructure projects announced by President López Obrador that will drive greater investments.

 

Ricardo Guzman Ricardo Guzman Editor