Mexico's export boom benefits five states only

Although Mexico is one of the 20 most attractive countries for foreign investment, commercial activity focuses on a few industries, whose products have a local content of 35% on average.
Archive / EL UNIVERSAL
19/05/2015
12:03
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Despite being the world's fifteenth largest economy and exporter, the commercial boom in Mexico is concentrated in five states only: Chihuahua, Coahuila, Baja California, Campeche and Nuevo León, according to the National Institute of Statistics and Geography (INEGI). 

Moreover, although Mexico is one of the 20 most attractive countries for foreign investment, commercial activity focuses on a few industries, whose products have a local content of 35% on average, according to government estimates. 

Therefore, the Economic Commission for Latin America and the Caribbean (ECLAC) considers that investments by Mexican manufacturing companies do not have a high value added. 

Official data show that Mexican exports are concentrated in the automotive, electronic, electrical and aerospace industries and are mostly produced at "maquiladoras" (manufacturing operations in free trade zones). 

"With the maquila system Mexican brands are not developed as it happened in Korea, that went from an assembler country to an innovative economy that positioned its companies" such as LG and Samsung, said Luis Enrique Zavala, director of the National Association of Importers and Exporters (ANIERM). 

"There is much work to be done so that Mexicans develop their patents and build large microcomponents in order to avoid China's experience, that keeps six dollars of the cell phones they manufacture while the German firm that designed them receives US$30," said the chairman of the Confederation of Industrial Chambers (Concamin), Manuel Herrera Vega. 

The national value added of exports is low. According to the study "Valor agregado en las exportaciones manufactureras" by Gerardo Fujii and Rosario Cervantes from ECLAC, in the case of transport equipment it is of 32.4%; electronics, 14.3%, and electrical equipment, 7.4%. 

For the federal government, Mexico's average value added is 35% of what is exported on average, "a quantum leap from what happened 30 years ago, when we only assembled parts and did not participate in the design and value adding process," Economy Minister Ildefonso Guajardo explained.

 

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