CANACINTRA Creates Network to Boost Mexican ExportsBy Alessa Flores | Tue, 06/30/2020 - 12:26
The National Chamber of the Transformation Industry (CANACINTRA) created the Network of Promoters of Foreign Trade (PROCEX) to promote the participation of Mexican companies in global value chains and increase their exports, according to Forbes Mexico. This network is supported by the National Association of Importers and Exporters of the Mexican Republic (ANIERM) and the Latin American Confederation of Customs Agents.
A report from the now shutdown ProMéxico revealed that during the export process, companies often make serious mistakes, which can lead to problems before, during and after exporting the product. Despite the fact that companies of all sizes can make mistakes, MSMES face the greatest difficulties in reaching international markets. ProMéxico suggested that companies should consider the opportunities and threats that the market represents, as well as the most appropriate resources available within the company to take advantage of such conditions. The network created by CANACINTRA could become key to support Mexican companies looking to be successful abroad.
CANACINTRA highlights that the organization will focus on two main areas to diversify exports. The first one will be to promote Mexican regions with high export potential and the second will be MSMEs. "The organization will seek to promote the decentralization of manufacturing exports from border entities or the Bajio, as well as to encourage the participation of MSMEs," explained Enoch Castellanos, President of CANACINTRA, to Forbes Mexico.
Total exports from Mexico, according to INEGI figures, reached in 2019 a figure of US$460.7 billion, while imports totaled US$445.3 billion, resulting in a total trade balance of US$5.4 billion in favor of Mexico. It should be noted that non-oil exports are the strongest contributors to the trade balance, since the sum of agricultural, extractive and manufacturing exports represented 95 percent of the total exports, while oil exports only represented 5 percent, according to INEGI.
According to Expansión, companies that contribute the most to exports in Mexico are large national and multinational players like General Motors, Nissan Mexicana, Volkswagen Mexico, Ford Motor Company, Coca-Cola FEMSA, Grupo México, Industrias Peñoles and Mabe. Meanwhile, SMES do not exceed 20 percent of exports, according to CANACINTRA.
Castellanos highlighted that there is a considerable difference between large companies and MSMES regarding their ability to participate in the international market. "It is the big companies that export and obtain the greatest benefits. That is why there is a subsistence economy among smaller companies and a globalized economy among big ones," said Castellanos. PROCEX aims to minimize inequality in exporting capacity and to increase the possibilities of MSMEs participating in the international market.
In addition to this strategy, binational chambers of commerce will join PROCEX to give greater momentum to the initiative. Binational chambers of Mexico and Brazil, Peru, Argentina, Chile, Dominican Republic, Pakistan and China will participate, as well as the Euro-Asian Economic Commission.
Pola Grijalva, President of China Chamber of Commerce and Technology Mexico, in an article for MBN explained that the relationship between Mexico and China will be mutually supportive to share the lessons learned from the pandemic and drive reactivation in both countries. “At the Mexico China Chamber of Commerce and Technology, we were well aware of what happened in China and learned valuable lessons. Therefore, we will hold four specialized seminars on the effects of COVID-19 on international trade, provide a diploma course for exporting companies interested in the Chinese market and hold a keynote session with our partner, Banco Santander, on financial instruments that support foreign trade.” In addition, Grijalva explained that “once normal prices have been restored, we expect all supply chains and distribution channels to open once more.”
It is expected that PROCEX will boost foreign trade for Mexico and also help companies of different sizes to participate in foreign trade. Through the network, companies will receive consulting, advice, training and preventive audits.