Mexico Investment at a Glance

Sergio Sarmiento

Mexico at a Glance

The Offshore Group, Inc. www.offshoregroup.com

Sergio Sarmiento

In a turbulent world, Mexico becomes an unexpected opportunity


Sergio Sarmiento

Mexico’s edge Natural resources

2,000-mile border with the U.S.

Free-trade agreements

8,000-mile coasts

A growing, young population


Sergio Sarmiento

The U.S. and the world have suffered in 2008 the worst financial crisis since 1929


Sergio Sarmiento

Reasons for U.S. crisis

Expansion of credit

Lack of savings

Budget deficit

Current-account deficit


Sergio Sarmiento

U.S. consumers have had a negative or extremely low savings rate for years


Sergio Sarmiento

Factors for low savings rate

Negative interest rates

Tax breaks for home purchases

Stock market boom

Housing boom políticos


Sergio Sarmiento

Not only consumers…. The U.S. government has also spent beyond its means


Sergio Sarmiento

U.S. budget deficit

U.S. budget deficit

2007 1.2

2008 3.2

2009 12

% of GDP

Mexican budget deficit

2007 0

2008 0

2009 1.8


Sergio Sarmiento

U.S.S federal public debt

1980 980 33.3

1990 3,233 55.9

2000 5,674 58

2009 10,024 72.5 (est)

Year $bn % of GDP


Sergio Sarmiento

Mexican federal public debt

1990 45.1

2000 19

2008 15 (est.)

Year % of GDP


Sergio Sarmiento

Budget deficits

Mexico’s budget deficit in 2009 will be a consequence of increased investment in infrastructure

The U.S.’s budget deficit in 2009 will be a consequence of the recue of the banking system


Sergio Sarmiento

Mexico is better prepared than many countries for the present financial crisis


Sergio Sarmiento

Mexico’s strengths

Reduced budget deficit

Low public debt

Healthy banks

Proximity to U.S. market


Sergio Sarmiento

Infrastructure

Mexico has serious infrastructure problems, but they are largely confined to the south

Northern Mexico is well connected with U.S. market


Sergio Sarmiento

Mexico still needs internal reforms

Energy

Fiscal

Labor

Education

Justice

And so on


Sergio Sarmiento

These reforms would make the country far more competitive


Sergio Sarmiento

A recession in the U.S. will affect Mexico….

…. and the rest of the world


Sergio Sarmiento

But Mexico remains a good bet for companies that want to be well positioned when the eventual recovery comes


THANK YOU

Mexico Investment at a Glance

Business

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