Nearshoring is becoming an increasingly trending topic in Mexico due to its potential to attract investment and jobs, as the country offers a vast pool of talented individuals, an ideal location and competitive manufacturing costs. However, parties in Mexico and abroad consider that the country’s potential to capitalize on this trend hinges on future policies, making the 2024 election a pivotal concern for the future of the country.
“Nearshoring is a crucial chance [that] the country must seize to achieve sustainable growth, generate a substantial number of new jobs, and cultivate the skills of the workforce employed by the incoming investment ventures,” says Hugo Hernández-Ojeda Alvírez, Partner, Hogan Lovells in Mexico. The expansión of the companies can not only create job opportunities but also facilitate knowledge transfer, fostering the growth of local talent and enhancing Mexico's workforce competitiveness.
Mexico is expected to undergo a transformation between 2024 and 2025 following the presidential election, government transition and the initial year of the president's six-year term. Political actions can either facilitate or impede progress. “We need proactive measures to capitalize on nearshoring's potential for transforming the country. Otherwise, nearshoring could become nothing more than a passing trend, resulting in marginal increases in investment and exports without any substantial changes to the overall national landscape,” Carlos Ramírez, Consultant, Integralia, tells Bloomberg.
While the some candidates are yet to be defines, potential candidates include Claudia Sheinbaum, Enrique de la Madrid, Marcelo Ebrard, Samuel García, Xóchitl Gálvez and Adan Augusto. Each candidate offers a distinct and individual approach to nearshoring that could shape the course of the country during the coming years.
Capitalizing on nearshoring could bring significant opportunities to Mexico in the short and long term, in turn generating numerous jobs and attracting investment. “According to the Inter-American Development Bank (IDB), Latin America and the Caribbean could receive, in the short and medium term, more than US$78 billion per year from this practice and our country would garner the greater benefit. Mexico would obtain up to US$33.5 billion annually for this concept. Very good news for our economy after months of uncertainty,” writes Vladimiro de la Mora, President, GE Mexico.