Foreign Investment Surges, But Not in Every State

Despite initial uncertainty at the beginning of 2025 due to US trade policy, new foreign direct investment (FDI) in Mexico gained momentum during the first quarter of the year. However, this increase in FDI was not evenly distributed across the country’s states.

According to data from the Ministry of Economy, new FDI inflows reached US$1.586 billion from January to March 2025, the highest level for a first quarter since 2023. Still, these investments accounted for only 7.4% of total FDI, a decrease from the 10.4% share recorded in 2024.

There was significant disparity among states in attracting new capital. Mexico City led with US$825.7 million in new FDI, representing 52.1% of the national total. While this concentration reflects the city’s role as the fiscal headquarters for many corporations, it does not necessarily indicate the location of actual operations, which often take place elsewhere.

Quintana Roo came in second with US$290.9 million in new investment, followed by Jalisco with US$91 million. Baja California, Baja California Sur, Nayarit, and Guanajuato attracted between US$44 million and US$90 million each.

States like Nuevo Leon, Guerrero, Queretaro, Yucatan, and Coahuila each brought in between US$15 million and US$36 million. Meanwhile, key industrial states such as Sonora, the State of Mexico, Puebla, and Veracruz saw less than US$8 million in new FDI.

Nine states, Aguascalientes, Chiapas, Chihuahua, Durango, Hidalgo, Michoacán, Morelos, San Luis Potosí, and Zacatecas, reported no new FDI during the period. Oaxaca even registered a capital outflow of US$14 million.

Despite growing FDI, the data does not necessarily reflect a broad nearshoring trend. Most new investments flowed into Mexico City and Quintana Roo, economies focused on commerce and services, rather than manufacturing or logistics. By country, Spain led new FDI with US$654 million, followed by Canada with US$373 million, the United States with US$288 million, and Germany with US$91 million. 

In terms of overall FDI, which totaled US$21.37 billion in 1Q25, 77.9% came from reinvested earnings, followed by intercompany accounts with 14.7% and new investments with 7.4%.  The United States remained the largest investor with US$8.26 billion, followed by Spain, the Netherlands, Australia, Germany, and Canada. Among sectors, commercial banking attracted the most FDI US$4.45 billion, followed by automotive manufacturing, metallic mining, beverage production, and wholesale vehicle parts distribution.