Country’s Profile• Official Name: United Mexican States

• Capital : Mexico City

• Nature of Govt.: Federal Republic

• National Anthem: Mexicans to the cry of war

• Date of Independence: September 16, 1810

• Date of Constitution: February 5, 1917

• Unit of Currency: Mexican Peso

• Population: 120,777,000 ( Approx. 121 Million)

• National Language: Spanish

• Major Ethnic Groups: Mestizo, Amerindian,White

Geography of Mexico• Total Area: 1972550 Sq. km (761,602 Sq. MI) (14th)

• The United Mexican States are a federation of 31 free and sovereign states, which form a union that exercises a degree of jurisdiction over the Federal District and other territories.

• Mexico is bordered by the United States to the north and Belize and Guatemala to the southeast.

• Two third of Mexico is mountainous.

• Mexico is about one-fifth the size of the United States.

• Mexico has a 9,330 kilometre coastline, of which 7,338 kilometres face the Pacific Ocean and the Gulf of California, and the remaining 2,805 kilometres front the Gulf of Mexico and the Caribbean Sea.

Principal Cities

1. Taxtla 2. Xalapa 3. Uruapan 4. Veracruz 5. Villa Nicolas 6. Villahermosa

Economy At a Glance• The economy of Mexico is the 14th

largest in the world in nominal terms and the 10th largest by purchasing power parity, according to the International Monetary Fund.

• Mexico is an export-oriented economy.• Trade organisations : APEC,

NAFTA,OECD,WTO• GDP: $ 1.2876 trillion (nominal; 2014)• $1.9266 trillion (PPP; 2014)• Status of Country :Latin America &

Caribbean (developing only) • Income level : Upper middle income • Life expectancy at birth, total (years) • : 77• GNI per capita, Atlas method (current

US$): $9,940

• Unemployment rate:4.9% (2015)• Population below poverty line:

52.3%• Public debt:377% of GDP (2015)• Inflation rate (consumer prices): 4 %Mexico's $1.3 trillion economy has become increasingly oriented toward manufacturing in the 20 years since the North American Free Trade Agreement (NAFTA) entered into force.

Breakdown of Economic Activity By Sector

Agriculture Industry Services

Employment By Sector (in % of Total Employment)

13.4 24.1 61.9

Value Added (in % of GDP)

3.5 34.8 61.7

Value Added (Annual % Change)

0.3 -0.7 2.1

Main Industries of MEXICO

1.Electronics, 2.food and beverages3.Tobacco4.Chemicals5.Iron and steel6.Petroleum7.Mining8.Textiles9.Clothing10.Motor Vehicles11.Consumer durables12.Tourism

Industries cont….• The electronics industry of Mexico has grown enormously within the

last decade. Mexico has the sixth largest electronics industry in the world after China, United States, Malaysia, Japan, South Korea, and Taiwan. Mexico is the second largest exporter of electronics to the United States where it exported $71.4 billion worth of electronics in 2014.

• The Mexican electronics industry is dominated by the manufacture and OEM design of televisions, displays, computers, mobile phones, circuit boards, semiconductors, electronic appliances, communications equipment and LCD modules.

• There are almost half a million (451,000) students enrolled in electronics engineering programs with an additional 114,000 electronics engineers entering the Mexican workforce each year.

• While many foreign companies like Phillips, Vizio and LG simply install wholly owned factories in Mexico a number of foreign companies have set up semi-independent joint venture companies with Mexican businesses to manufacture and design components in Mexico.

Industries cont….

• Although much of Mexico's electronics industry is driven by foreign companies, Mexico also has a sizeable domestic electronics industry and a number of electronics companies.

• Another area being currently developed in Mexico is Robotics, Mexico's new Mexone robot has been designed with the idea that in future years develop a commercial application for such advanced robots.

• Mineral resources are the "nation's property" (i.e. public property) by constitution. As such, the energy sector is administered by the government with varying degrees of private investment. Mexico is the sixth-largest oil producer in the world, with 3,700,000 barrels per day (590,000 m3/d).

• The automotive sector accounts for 17.6% of Mexico’s manufacturing sector. General Motors, Chrysler, Ford Motor Company, Nissan, Fiat, Renault, Honda, Toyota, and Volkswagen produce 2.8 million vehicles annually at 20 plants across the country, mostly in Puebla.

• The tertiary sector was estimated to account for 70.5% of the country's GDP, and employs 58% of the active population.

• Tourism is one of the most important industries in Mexico. It is the fourth largest source of foreign exchange for the country.

Import of Mexico

• Imports in Mexico decreased to 114.37 USD Million in February of 2015 from 29816 USD Million in January of 2015.

• Imports in Mexico averaged 11998.17 USD Million from 1980 until 2015, reaching an all time high of 36943.16 USD Million in October of 2014 and a record low of 114.37 USD Million in February of 2015.

Import of Mexico• Mexico main imports are: metallic products, machinery and

equipment,

• Primary imports - commodities: Metalworking machines, steel

mill products, agricultural machinery, electrical equipment, car

parts for assembly, repair parts for motor vehicles, aircraft and

aircraft parts (50 percent of total imports)

• Mining products (13 percent),

• Chemical products (6.3 percent)

• Plastic and rubber products (6 percent).

• Main import partners are: United States (51 percent of total imports), China (16 percent) and Japan (5 percent).

2009 2010 2011 2012 2013

Imports (USD billion)

234.4 301.5 350.8 370.8 381.2

Export of Mexico

2009 2010 2011 2012 2013

Exports (USD billion)

229.7 298.5 349.4 370.8 380.0

• In January, the trade balance showed a USD 3.2 billion deficit. The reading matched the deficit observed in the same month last year and was also in line with market expectations. In the 12 months up to January, the trade balance incurred a deficit of USD 2.5 billion. The reading followed the USD 2.4 billion that was observed in the 12 months up to December.

• January’s trade deficit reflected a deterioration in exports, which totalled USD 26.6 billion in January and represented a 1.8% contraction in annual terms .

Top Ten Exports of Mexico• Electronic equipment: (29.3% of

total exports)• Vehicles excluding trains and

streetcars: (20.3%)• Machinery:(14.2%)• Mineral fuels including oil:

(12.8%)• Optical, technical and medical

apparatus: (3.4%)• Pearls, precious stones metals

and coins: (2.6%)• Furniture, lighting, signs, prefab

buildings:(2.2%)• Plastics: (2.1%)• Iron or steel articles: (1.5%)• Vegetables: (1.4%)

Ease of Doing Business in Mexico Topics

DB 2015 Rank

DB 2014 RankChange in Rank

Starting a Business 67 61 -6

Dealing with Construction Permits

108 97 -11

Getting Electricity 116 112 -4

Registering Property

110 109 -1

Getting Credit 12 14 2

Protecting Minority Investors

62 61 -1

Paying Taxes 105 102 -3

Trading Across Borders

44 44 No change

Enforcing Contracts 57 59 2

Resolving Insolvency

27 33 6

Trade Environment • The economy gained traction in the last quarter of 2014 due to

solid growth in construction, manufacturing and services, which compensated for the dismal performance in mining.

• Bilateral relations : North America, Canada, United States, Africa, Asia, Europe, Oecania.

• As an export-oriented economy, more than 90% of Mexican trade is under free trade agreements (FTAs) with more than 40 countries,

• In spite of its unprecedented macroeconomic stability, which has reduced inflation and interest rates to record lows and has increased per capita income, enormous gaps remain between the urban and the rural population, the northern and southern states, and the rich and the poor.

• Some of the government's challenges include the upgrade of infrastructure, the modernization of the tax system and labor laws, and the reduction of income inequality. The tax revenues, all together 19.6 percent of GDP in 2013, are the lowest among the 34 OECD countries.

Business Environment• Recently, the Congress of the Union approved

important tax, pension and judicial reforms, and reform to the oil industry is currently being debated. Mexico had 16 companies in the Forbes Global 2000 list of the world's largest companies in 2014.

• Mexico's labour force is 78 million. The OECD and WTO both rank Mexican workers as the hardest-working in the world in terms of the amount of hours worked yearly, although profitability per man-hour remains low.

• Agriculture, as a percentage of GDP, has been steadily declining, and now resembles that of developed nations, in that it plays a smaller role in the economy.

Business Environment• However, high crime rates prove problematic for

businesses.

• The government is making efforts to encourage investments in key industries but the tax environment is not overly business friendly and labour markets are rigid. Mexico's large consumer market and proximity to the USA provide significant opportunities for marketers of consumer goods.

• Mexico's investment laws are generally geared towards actively encouraging foreign investment. Foreign direct investment (FDI) is however restricted for the airline, telecoms and energy industries.

• Mexico ranked 78th out of 138 countries in the Networked Readiness Index in 2013.

The pros and cons of doing business in Mexico

• The low cost of labour has long been one of the main advantages of Mexico.

• Mexico has the most free-trade agreements (17 agreements with 49 countries) of any country in the world.

• The main one is certainly NAFTA. That means you can work without much difficulty among the three countries, to settle in Mexico, import products from the United States, export to the U.S. and Canada and so on.

• Mexico has an industrial and financial system among the most sophisticated in the world, and represents a market of 110 million people, with a growing middle class. The peso is also a very stable currency.

• One sign that Mexico is attractive to investors: there are already more than 2,400 companies with Canadian interests on Mexican soil.

Cont…..

• This is a general problem. This is not only the case for Canadian SMEs. This is also true for the Americans and any other country, as well as Mexican women who want to settle in the United States or Canada: SMEs in general have difficulty moving abroad, especially where there is a difference of language and culture. They do not have the same resources as multinationals. It is a combination of lack of skills, fear of the unknown, sometimes a lack of financing or [a case where] credit is less available for SMEs.

Latest Business Trends• 1) Old Trend: Expensive solar, surviving

only on subsidies.New Trend: Cheap solar, disrupting old industries.

• 2. Old Trend: The Latinization of America.New Trend: The Asiafication of America.

• 3. Old Trend: The Chinese population bomb.New Trend: The Chinese population bust.

• 4. Old Trend: Soaring U.S. CO2 emissions.New Trend: Plummeting U.S. CO2 emissions.

• 5. Old Trend: Traditional College is becoming more and more important.New Trend: College is no more important than before but focus on V training.