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Chen jiale(Caleb)
Dinh Phong Nguyen (Phong)
Pitipong Tungsuttivong (Chern)
Yifeng Wang(Jerry)

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1. Open minded
2. Creative
3. Always ask for the others’s opinion
4. Share knowledge

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1.https://doi.org/10.1177/09749101211067091

2.https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9184197/

3.https://doi.org/10.1186/s43093-022-00155-3

4.https://fbj.springeropen.com/counter/pdf/10.1186/s43093-022-00155-3.pdf

5.https://feaa.ucv.ro/annals/v1_2021/005.pdf

6.https://econpapers.repec.org/article/unctncjou/34.htm

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Analyse the impact of the Coronavirus Pandemic on Foreign Direct Investment (FDI). T.Pitipong (Chern)

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Analyse the impact of the Coronavirus Pandemic on Foreign Direct Investment (FDI). T.Pitipong (Chern)

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1. https://link.springer.com/content/pdf/10.1186/s43093-022-00133-9.pdf?pdf=button

2. https://deliverypdf.ssrn.com/delivery.php?ID=740102120112122024014093001082086098016073055036039026094122100075069095031124026111057021116004010037021071031028008082096026041086005060042088096116009006112076089062011064009087029100068011127117098089086089126122090027031006088026093021084067069009&EXT=pdf&INDEX=TRUE

3. https://nelson.northampton.ac.uk/discovery/fulldisplay?docid=cdi_proquest_journals_2555237813&context=PC&vid=44NORTH_INST:44NORTH_INST&lang=en&search_scope=MyInst_and_CI&adaptor=Primo%20Central&tab=Everything&query=any,contains,the%20impact%20of%20the%20Coronavirus%20Pandemic%20on%20Foreign%20Direct%20Investment%20(FDI).&offset=0

4. https://nelson.northampton.ac.uk/discovery/fulldisplay?docid=cdi_gale_infotracacademiconefile_A668712690&context=PC&vid=44NORTH_INST:44NORTH_INST&lang=en&search_scope=MyInst_and_CI&adaptor=Primo%20Central&tab=Everything&query=any,contains,the%20impact%20of%20the%20Coronavirus%20Pandemic%20on%20Foreign%20Direct%20Investment%20(FDI).&offset=0

5. https://nelson.northampton.ac.uk/discovery/fulldisplay?docid=cdi_doaj_primary_oai_doaj_org_article_a5d4db88de974af1878e3963d6b6cef5&context=PC&vid=44NORTH_INST:44NORTH_INST&lang=en&search_scope=MyInst_and_CI&adaptor=Primo%20Central&tab=Everything&query=any,contains,the%20impact%20of%20the%20Coronavirus%20Pandemic%20on%20Foreign%20Direct%20Investment%20(FDI).&offset=0

6. https://mdpi-res.com/d_attachment/jrfm/jrfm-14-00107/article_deploy/jrfm-14-00107-with-cover.pdf?version=1669210248

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How does FDI really affect developing countries?
1.https://nelson.northampton.ac.uk/discovery/fulldisplay?docid=cdi_nrf_kci_oai_kci_go_kr_ARTI_6028163&context=PC&vid=44NORTH_INST:44NORTH_INST&lang=en&search_scope=MyInst_and_CI&adaptor=Primo%20Central&tab=Everything&query=any,contains,What%20is%20the%20impact%20of%20FDI%20on%20developing%20countries&offset=0

2.https://nelson.northampton.ac.uk/discovery/fulldisplay?docid=cdi_proquest_miscellaneous_1364727439&context=PC&vid=44NORTH_INST:44NORTH_INST&lang=en&search_scope=MyInst_and_CI&adaptor=Primo%20Central&tab=Everything&query=any,contains,What%20is%20the%20impact%20of%20FDI%20on%20developing%20countries&offset=0

3.https://nelson.northampton.ac.uk/discovery/fulldisplay?docid=cdi_nrf_kci_oai_kci_go_kr_ARTI_7109129&context=PC&vid=44NORTH_INST:44NORTH_INST&lang=en&search_scope=MyInst_and_CI&adaptor=Primo%20Central&tab=Everything&query=any,contains,What%20is%20the%20impact%20of%20FDI%20on%20developing%20countries&offset=0

4.https://nelson.northampton.ac.uk/discovery/fulldisplay?docid=cdi_proquest_journals_237250753&context=PC&vid=44NORTH_INST:44NORTH_INST&lang=en&search_scope=MyInst_and_CI&adaptor=Primo%20Central&tab=Everything&query=any,contains,What%20is%20the%20impact%20of%20FDI%20on%20developing%20countries&offset=0

5.https://nelson.northampton.ac.uk/discovery/fulldisplay?docid=cdi_proquest_miscellaneous_1364726687&context=PC&vid=44NORTH_INST:44NORTH_INST&lang=en&search_scope=MyInst_and_CI&adaptor=Primo%20Central&tab=Everything&query=any,contains,What%20is%20the%20impact%20of%20FDI%20on%20developing%20countries&offset=10

6.https://nelson.northampton.ac.uk/discovery/fulldisplay?docid=cdi_proquest_journals_1683934421&context=PC&vid=44NORTH_INST:44NORTH_INST&lang=en&search_scope=MyInst_and_CI&adaptor=Primo%20Central&tab=Everything&query=any,contains,What%20is%20the%20impact%20of%20FDI%20on%20developing%20countries&offset=0

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3) Select a country of your choice and comment on that country’s inward FDI.

-https://www.eastasiaforum.org/2022/09/27/vietnam-fights-for-foreign-investors/

-https://www.economist.com/finance-and-economics/2020/07/18/why-globalists-and-frontier-market-investors-love-vietnam

-https://www.economist.com/asia/2022/09/22/vietnam-is-emerging-as-a-winner-from-the-era-of-deglobalisation

-https://www.forbes.com/sites/peterpham/2016/04/30/a-case-study-of-successful-vietnam-market-entry-metro-cashcarry/?sh=1b34e0c93ebb

-https://www.state.gov/reports/2021-investment-climate-statements/vietnam/

-https://assets.publishing.service.gov.uk/media/57a08cbbed915d622c00152d/drc10_vietnam.pdf

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1. Researching about providing back ground on the effect of the Covid-19 pandemic on the Global Economy.
2. Researching outsources about Mexico economy.

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Emerging Market to focus on: MEXICO.
Prepare the document and do the draft for the effect of the Covid-19 pandemic to Mexico economy

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1.Find companies affected by COVID-19 in Mexico
2.Analyse them by locating secondary data

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1.Find real cases of companies affected by COVID-19 in Mexico.
2.Research for COVID-19 pandemic affected FDI in Emerging markets and research what are the prospects for long-term recovery post-pandemic.

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https://inversian.com/bimbo-historia-resumida/#:~:text=Bimbo%20es%20una%20empresa%20de%20origen%20mexicano%20y,de%20forma%20que%20representaba%20claramente%20a%20la%20empresa.

https://www.bakingbusiness.com/articles/50592-grupo-bimbo-describes-covid-19-impact-on-global-operations

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Impact of COVID-19  to the global economy

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Impact of COVID-19  to the global economy

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1. https://www.worldbank.org/en/publication/wdr2022/brief/chapter-1-introduction-the-economic-impacts-of-the-covid-19-crisis

2. https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/the-coronavirus-effect-on-global-economic-sentiment

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1. https://www.castusglobal.com/insights/emerging-market-mexico

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1. https://www.worldbank.org/en/country/mexico/overview

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The effect of COVID19 pandemic to Mexico economy

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The effect of COVID19 pandemic to Mexico economy

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-https://mdpi-res.com/d_attachment/sustainability/sustainability-13-07470/article_deploy/sustainability-13-07470.pdf?version=1625450676
-https://cepr.org/system/files/publication-files/101400-covid_economics_issue_48.pdf#page=215
-https://www.tandfonline.com/doi/full/10.1080/19407963.2021.2017726
-https://www.scielo.org.mx/pdf/rmef/v16n3/2448-6795-rmef-16-03-e633.pdf

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https://www.volkswagen-newsroom.com/en/volkswagen-de-mexico-4070

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The headquarters and the vehicle and component plants of Volkswagen de México are located in Puebla, the capital of the federal state of the same name, 74 miles south east of Mexico City. A Volkswagen engine plant was opened in Silao in the central Mexican state of Guanajuato in January 2013. The Volkswagen plant in Puebla is the largest automobile factory in Mexico and also one of the largest vehicle plants in the Volkswagen Group. All the production processes needed, including the stamping of body parts and the production of engines, axles and catalytic converters, take place here. The Puebla plant produces the models: Jetta, Beetle, Beetle Cabriolet, Golf, Golf SportWagen and Tiguan Long Version.

The engines plant in Silao started its operations in January 2013. This factory supplies the third generation of EA888 engines family to the Volkswagen vehicle plants in Puebla, Mexico, and Chattanooga, USA; Audi plant, in San Jose Chiapa, Puebla, and VW do Brasil. It is designed for an annual capacity of 420,000 engines and the plant site has a total area of 60 hectares.

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The headquarters and the vehicle and component plants of Volkswagen de México are located in Puebla, the capital of the federal state of the same name, 74 miles south east of Mexico City. A Volkswagen engine plant was opened in Silao in the central Mexican state of Guanajuato in January 2013.

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https://historicalmx.org/items/show/75

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Proposition

___________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Background

-          ________________________________________________ (citation)

-          _______________________________________________ (citation)

-          _______________________________________________ (citation)

Point 1 : _______________________________________

-          ________________________________________________ (citation)

-          _________________________________________________ (citation)

-          ______________________________________________ (citation)

Point 2: ______________________________________________

-          ______________________________________________ (citation)

-          _______________________________________________ (citation)

-          ________________________________________________ (citation)

Conclusion

____________________________________________________________________

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Effect of covid-19 on Grupo Bimbo

Grupo Bimbo: Historia resumida. 【1】
-Established on December 2, 1945
-In 1946, the production of brown bread began
-Acquired the Panrico Bakery in Beijing in 2007
-Distributing more than 10,000 kinds of products
-More than 1 million points of sale worldwide

Grupo Bimbo describes COVID-19 impact on global operations [2]
-Sudden surge in production orders under the influence of COVID-19
-Difficulties in keeping employees and food safe in operations
-The impact of quarantine policies
-Impact of COVID-19 on the global bakery industry.

Grupo Bimbo reafirma su compromiso con la sociedad frente al COVID-19 [3]
-Since COVID-19 was classified as a global pandemic by the World Health Organization, the bimbo Group has taken many new measures in the face of this situation.

-Ensure supply chain security and provide safe working space for partners through policies such as remote work, special shift system, suspension of company activities and travel involving people.

-In addition, they also publicized the hazards of COVID-19 and preventive measures to employees in the workplace or by mail to improve their awareness of independent health maintenance.

[1] Angle, P (2016) Bimbo: Historia resumida. [online]

Available at: https://inversian.com/bimbo-historia-resumida/#:~:text=Bimbo%20es%20una%20empresa%20de%20origen%20mexicano%20y,de%20forma%20que%20representaba%20claramente%20a%20la%20empresa. (Accessed: February 28, 2023)

[2] Spencer, J (2020) Grupo Bimbo describes COVID-19 impact on global operations.[online] Available at:https://padlet.com/jialechen211/group-2-padlet-ktu5vjdghqf7hiyo/wish/2497999036 (Accessed: February 28, 2023)

[3] MEXICO CITY (2020) Grupo Bimbo reafirma su compromiso con la sociedad frente al COVID-19. [online] Available at: https://grupobimbo.com/en/press/releases/community/grupo-bimbo-reafirma-su-compromiso-con-la-sociedad-frente-al-covid-19 (Accessed: March 10, 2023)

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Grupo Bimbo reafirma su compromiso con la sociedad frente al COVID-19 | Grupo Bimbo

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Para lograrlo, estamos tomando todas las medidas necesarias que nos permitan asegurar la cadena de suministro en nuestras operaciones, así como brindar a nuestros colaboradores espacios de trabajo seguros.

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Yifeng Wang （what impact does COVID-19 have on Volkswagen in Mexico）

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Yifeng Wang （what impact does COVID-19 have on Volkswagen in Mexico）

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What impact does COVID-19 have on Volkswagen in Mexico

Production disruption: Due to the impact of COVID-19, VW will not be able to resume production at the plant of German car manufacturer Volkswagen and its subsidiary Audi in the Mexican state of Puebla as planned due to concerns about the spread of the coronavirus. Meanwhile the governor of the state of Puebla signed a decree saying that conditions were not yet conducive to reopening the automotive and construction industries and said that while he was keen to restart the local economy as soon as possible, he would not do so at the expense of public safety. Due to the pandemic, VW closed the plant in late March 2020 and has been waiting for the authorities to reopen it. The Mexican government initially decided to resume production on 18 May 2020 but then postponed it, bringing production in the region to a halt.[1]

Sales have been affected: According to the data, the Volkswagen Group's business was severely affected by the Covid-19 pandemic in the first quarter, which had a significant impact on its business due to the global Covid-19 pandemic. Compared to the same period last year, deliveries to customers fell by 23.0 per cent to 2.0 (20,000 units). Sales revenue fell by 3.55% from June to August to €100 million (€6 billion). Operating profit excluding special items fell sharply by 0.81% to €400 million (€0.0 billion). Exceptional items resulting from the diesel crisis reduced profit by €0.9 billion. no exceptional items in the first quarter of FY4. operating return on sales for the first quarter of FY8 was 1.0% (2020.2020% or 1.6% excluding exceptional items). In addition to lower unit sales due to lower customer demand, the volatility in commodity and capital markets led to a negative currency effect due to the negative impact of fair value measurement of commodity hedges. Profit before tax declined to EUR 0.6 billion (EUR 0.4 billion).[2]

[1]: Coronavirus keeps VW Mexico plants shut Available from: https://www.dw.com/en/volkswagen-audi-ordered-to-keep-mexican-factories-shut/a-53794742

[2]: Volkswagen Group’s business substantially impacted by Covid-19 pandemic in first quarter available from: https://www.volkswagen-newsroom.com/en/press-releases/volkswagen-groups-business-substantially-impacted-by-covid-19-pandemic-in-first-quarter-5998

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Proposition - Why choose Mexico? (CHERN do it, but hope anyone will present)
Slide 1 - Mexico is a country where the main factors attracting foreign investment include the NAFTA market, proximity to the border with the United States (strategic location), relatively stable economic and political conditions, tax and pension restructures, improving the quality of labor (competitive labor costs) and education.

Slide 2 - Foreign investment in Mexico is targeted in the automotive sector, with foreign automakers expanding in Mexico including Volkswagen AG, Nissan Motor, Mazda Motor and General Motors.

Slide 3- Mexican companies investing abroad include Grupo Televisa Mexico, Sigma Alimentos, Metalsa, Inmobiliaria Carso, Grupo Bimbo, Mexichem, Femsa, Gruma and Cemex. These companies make direct investments in the US. South America and Europe In many areas of business such as communications, food production, automobile manufacturing and in the service sector, etc. (2)

Slide 1-3 References
(1) Wait from Ruan Ting Feng (The reasons why should Mexico)
(2) https://santandertrade.com/en/portal/establish-overseas/mexico/foreign-investment

Background - The effect of Covid-19 to global economy (CHERN)
Slide 4 - The COVID-19 epidemic caused the worst global economic crisis in more than a century and sent shockwaves through the world economy.
The crisis caused a sharp rise in inequality both within and across nations.

Slide 5 - The economic impact of the pandemic is especially severe in emerging economies, with income losses of more than 50 percent of households in emerging economies and they are unable to maintain basic consumption levels for more than three months.

Slide 6 - However, small enterprises Small and medium-sized industries are the industries hardest hit by crises such as accommodation and food services, retail, and personal services. Governments have adopted a number of policy tools that are either new or unfamiliar to this extent in emerging economies. An example is a large number of direct income support measures, debt suspension, and a project to purchase assets by central banks.

Slide 7 -  The size and scope of these projects vary widely. This is partly because many low-income countries found it difficult to raise funds due to limited access to credit markets and high levels of government debt prior to the financial crisis.
- Fiscal response to the COVID-19 crisis, selected countries, by income group.
(I'll add the graph image to this slide) (3)

Slide 4-7 References
(3) https://www.worldbank.org/en/publication/wdr2022/brief/chapter-1-introduction-the-economic-impacts-of-the-covid-19-crisis

Point 1 - The effect of Covid-19 to Mexico Economy

>The COVID-19 pandemic hit Mexico [2] at a time when the country’s economy was already showing signs of weakness, having recorded

>a negative variation of 2.2% in the first quarter of 2020 with respect to the same quarter the previous year.

>In 2020, Mexico's GDP shrank by 8.3% in real terms and using original series [4]

>stock markets suffered historic losses[6]

>Stagflation[7]

>Supply chain disruption [8]

Point 2 - The effect of Covid-19 to FDI in Mexico.
>Supply Chain Disruption:

The Covid-19 pandemic has caused disruptions in global supply chains, affecting the ability of FDI enterprises to produce and transport goods in Mexico. This disruption causes the following consequences:

-Shortage of input materials: leading to a decrease in production and revenue of FDI enterprises in Mexico.

-Lack of human resources: affecting production capacity and product quality of enterprises.

-Disruption in transportation: due to distance and time limitations, as well as government control regulations for disease control.

-Uncertainty: cause anxiety for FDI enterprises in Mexico. Forecasting and planning for the future becomes more difficult due to this uncertainty.

>Decline in demand:

The Covid-19 pandemic has caused a decline in demand in global markets, affecting sales of FDI enterprises in Mexico. Social distancing measures and movement restrictions have made it difficult for FDI enterprises in Mexico to do business and reduce people's consumption demand, affecting production and sales activities of Mexico. businesses around the world, including FDI enterprises in Mexico.

>Production disruption:

The Covid-19 pandemic has caused disruption in production and business activities of FDI enterprises in Mexico. This phenomenon has been caused by supply Chain Disruption and shortage of human resources.

>Investment decline:

The Covid-19 pandemic has caused a decrease in investment from FDI enterprises in Mexico, due to the effects of the pandemic on the global economic situation.

>The change in economic policy:

The Covid-19 pandemic has caused a change in the economic policies of the Mexican government and other countries, affecting the business environment of FDI enterprises in Mexico. Some measures such as social distancing, business activity restrictions and movement restrictions have been put in place to control the spread of the virus, but have also caused disruptions in production and transportation. chemical. In addition, measures such as import restrictions or increased taxes can also negatively impact the business activities of FDI enterprises here.

Point 3 - Specific company
1. Volkswagen de Mexico
2.Grupo Bimbo
Conclusion

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In this page: FDI in Figures | What to consider if you invest in Mexico | Protection of Foreign Investment | Procedures Relative to Foreign Investment | Office Real Estate and Land Ownership | Investment Aid | Investment Opportunities | Sectors Where Investment Opportunities Are Fewer | Finding Assistance For Further Information

FDI in Figures

Mexico is one of the emerging countries most open to foreign direct investment, the world's ninth largest FDI recipient. In 2021, Mexico was the second largest recipient of in Central America. According to UNCTAD's 2022 World Investment Report, FDI inflows increase by 13% to USD 31.6 billion, with new equity investments in the mining and extractive industries. Furthermore, Greenfield investments increased from 304 in 2020 to 376 in 2021, with the biggest jump being in information and communication. For example, Huawei announced the opening a cloud data centre in Mexico for USD 4.5 billion. The total stock of FDI is estimated to have reached USD 578 billion in 2021. Overall, FDI inflows were affected by rising uncertainty over the government's economic agenda, its focus on fiscal austerity, and the slump in fixed investment. These factors were compounded by persistent concerns about the current administration's critical stance on public-private partnerships (PPPs) and the role of the private sector in key industries, together with the financial situation of the state-owned oil company Pemex and the massive assistance it receives from the government (valued at USD 3.5 billion). Besides, shifts in the five-year plan and in the policy of CFE, the state electricity supplier, discouraged private investment in public utilities and contributed to a 67% drop in FDI in electricity generation, transmission and distribution.
Investments mostly come from the United States, Canada, Spain, Japan, and Germany. The sectors receiving significant foreign investment are manufacturing (especially the automobile industry), financial and insurance services, transport, retail and wholesale trade, mining and quarrying, and communication. Foreign investments are mostly concentrated in towns neighbouring the U.S border (where many assembly factories are located), as well as in the capital. Thanks to its robust tourism industry, the Yucatan Peninsula also receives substantial foreign investment. FDI flows to the country fluctuate strongly depending on the arrival and departure of large international groups.

As a member of USMCA, OECD, G20, and the Pacific Alliance, Mexico is very well integrated into the world economic order, making it an attractive country for FDI. Additionally, Mexico enjoys a strategic location, a big domestic market, a wide variety of natural resources, a relatively well-qualified workforce and diversified economy. However, in recent years, Mexico's competitiveness has suffered from the rise of organised crime and lack of reforms in the energy sector and in tax regulations. Corruption and administrative inefficiency have also been major issues and the business climate continues to suffer from safety risks in the country. According to the Economist Business Environment, Mexico ranks 42 out of the 82 countries reviewed for their investment climate. Among the biggest investments that occurred in recent years is the purchase of Mexican bank ABC Capital by Argentine fintech Ualá, in 2021. However, the value of the transaction was not disclosed.

Source: UNCTAD, Latest available data.

Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.

FDI INFLOWS BY COUNTRY AND INDUSTRY

Source: Ministry of Economy (in Spanish) - Latest available data.

Form of Company Preferred By Foreign Investors

The most common forms of creating a business company are the Limited Liability Stock Corporation (Sociedad Anonima, S. A.) and the Limited Liability Company (Sociedad de Responsabilidad Limitada S.R.L.).

Form of Establishment Preferred By Foreign Investors

Subsidiaries and assembling plants for the 'maquiladora' (assembly plant) industry.

Main Foreign Companies

IBM, Coca-Cola, Motorola, Walmart, Inditex Group, BBVA Bancomer, Santander Group, Procter & Gambleetc. Also, 500 of the largest Latin American enterprises have a presence in Mexico.

Sources of Statistics

General Direction of Foreign Investments

What to consider if you invest in Mexico

Strong Points

Mexico attracts the most FDI in Central and South America:

In addition to being very open to foreign direct investment, the country is very well integrated into the world economic order: it is a member of NAFTA, OECD, G20 and the Pacific Alliance.

It enjoys a strategic geographic location and acts as a transit platform to North America and Latin America.

The country has a wide variety of natural resources, which allows the development of all types of industries at very competitive prices.

The cost of labour (a young and abundant labour force) is not very high and is relatively well qualified.

The country is the seventh biggest tourist destination in the world and has in parallel a large and important industrial base.

Weak Points

There are still many obstacles to investment in Mexico:

The country relies heavily on its partnership with the United States and is therefore vulnerable to any changes to the free trade agreement

The level of corruption is high and the crime rate is rising

The country faces important structural problems (economic and social)

Some sectors are reserved for the Mexican state or Mexican citizens

Very strong competition in certain sectors

An economy vulnerable to fluctuations in the oil prices

Infrastructure (transport and oil sector in particular) and a system of education that are generally deficient and ineffective

Drug gang violence is a major danger, both socially and economically in many areas, especially in border areas with the US.

Government Measures to Motivate or Restrict FDI

The Mexican government has created an open and secure environment for foreign investors. The 'Invest in Mexico' Business Center was established in 2022 to facilitate investments. Land grants or discounts, tax deductions, and technology, innovation, and workforce development funding are commonly used incentives.
Other incentives to encourage foreign investment include:

Special Economic Zones (SEZs) were created to attract investment to the economically underdeveloped areas in the southern states of the country. Companies setting up in these SEZs will receive various incentives, trade facilities, duty-free customs benefits, infrastructure development prerogatives and easier regulatory processes.

Free trade zones (FTZ), where goods directed to foreign markets can leave Mexico duty free.

Refund of import duty paid on definitive imports. This incentive establishes a benefit for importers, who can obtain a refund of the import duty paid on the definitive import of raw materials or finished goods when exported within 12 months of being imported.

The IMMEX program, formally known as the IMMEX maquiladora program, allows foreign manufacturers to import raw materials and components into Mexico, tax and duty free, under the condition that 100% of all finished goods will be exported out of Mexico within a government mandated timeframe

New certified companies programme (NEEC). NEEC certification allows companies to move goods in and out of Mexico quickly and with less paperwork.

Real estate investment funds (REITs)

Protection of Foreign Investment

Bilateral Investment Conventions Signed By Mexico

Mexico has signed onto bilateral investment treaties with over 35 countries. The UNCTAD website allows you to visualise the list of conventions signed by Mexico.

International Controversies Registered By UNCTAD

The ISDS Navigator contains information about known international arbitration cases initiated by investors against States pursuant to international investment agreements. Mexico is involved in 4 cases as Home State of claimant and in 35 cases as Respondent State.

Organizations Offering Their Assistance in Case of Disagreement

ICCWBO , International court of arbitration, International chamber of commerce ICSID , International Center for settlement of Investment Disputes

Member of the Multilateral Investment Guarantee Agency

Mexico is a member of the MIGA convention.

Procedures Relative to Foreign Investment

Freedom of Establishment

Guaranteed

Acquisition of Holdings

Having a majority of capital holdings in a Mexican corporation is legal, though there are some limitations. There are certain strategic sectors in which the percentage of foreign investment is legally regulated and limited in the following manner (Article 7, Foreign Investments Law - Ley de Inversión Extranjera):

Up to 10% in co-operative production associations.

Up to 25% in local air transportation.

Up to 49% in insurance and bonding companies; currency exchange houses; leasing companies; factoring companies; investment funds (not private equity companies); companies involved in the manufacture and sale of explosives and firearms; newspapers, cable TV and basic telephone services; and port administration.

For more information, see the text of the the Mexican foreign investment law governing such limitations.

Obligation to Declare

The laws restricting or regulating certain takeovers and mergers are the following:

Foreign Investment Law (Ley de Inversión Extranjera)

Federal Antitrust Law (Ley Federal de Competencia Económica)

Securities Law (Ley del Mercado de Valores)

Competent Organisation For the Declaration

Mexican Federal Tax Administration (in Spanish)

Requests For Specific Authorisations

A special authorisation is needed for foreign ownership from the National Foreign Investments Commission (Comisión Nacional de Inversiones Extranjeras) when foreign investment will exceed 49% in: Shipping companies, Air terminals, Cellular-telephone services.

To find out the total that must be declared visit the Mexican Federal Tax Administration.

Office Real Estate and Land Ownership

Possible Temporary Solutions

Temporary office solutions

The Possibility of Buying Land and Industrial and Commercial Buildings

Only Mexican nationals (by birth or naturalisation) and Mexican companies can acquire the ownership of land, water and their associated items and obtain concessions for mining or water sources and waterways.
The state may grant the same rights to foreign individuals, provided they agree with the Ministry of Foreign Affairs to consider themselves Mexican nationals with respect to such property and undertake not to invoke the protection of their governments in respect of such property. Otherwise, the land acquired in case of default is confiscated and transferred to the Mexican State.
Under no circumstances can foreign individuals acquire direct ownership of lands and waters located within 100 kilometres from Mexico's international borders and within 50 kilometres from its coastlines (for commercial use).

Risk of Expropriation

Foreign investors have a right to a compensation if they are victims of expropriation for public means. Expropriations are governed by international law and require rapid fair market value compensation.

Investment Aid

Forms of Aid

Land grants or discounts, tax deductions, and technology, innovation, and workforce development funding are commonly used incentives.

Privileged Domains

Investment aids aim to promote innovation, research and development and job creation.

Privileged Geographical Zones

Companies setting up in these Special Economic Zones will be offered tax, customs duty and administrative and regulatory benefits.
The main SEZs:

The Pacific port of Lázaro Cárdenas (on the border of the states of Michoacán and Guerrero)

Salina Cruz

Puerto Chiapas (Chiapas)

The Coatzacoalcos Corridor / Ciudad del Carmen (Campeche)

Champotón

Progreso

Dos Bocas

Special Economic Zones (Zonas Económicas Especiales or ZEEs) are now entirely under state jurisdiction. As of April 2020, there are only two federal ZEE-style projects being developed where fiscal incentives would apply. These are the Trans-Isthmic Interoceanic Corridor and the Chetumal State border area.

Free-trade zones

Mexico's first foreign trade zone is located at an industrial park located in the city of San Luis Potosí and consists of:
1. The 'maquiladora' zone (assembly factories) as well as bonded warehouses;
2. Bonded zones (in customs), free trading posts to perform activities such as manufacturing, repairing, distribution and sales of merchandise;
3. Free zone "Recinto Fiscal Estratégico" with a customs office (WTC industrial zone)

In general, the Mexico version of the foreign trade zone reportedly permits raw materials and components to enter Mexico duty-free for manufacturing, assembly and other services (similar to the Maquila industry in Mexico).

Public aid and funding organisations

Nacional Financiera, Banca de Desarrollo and Bancomext.

Investment Opportunities

The Key Sectors of the National Economy

Auto parts, machinery, equipment, chemicals, financial services and insurance services.

High Potential Sectors

After-sales services for the automotive sector (repairs, maintenance, sale of parts and accessories), electronics, distribution chains, renewable energies, food, beverages and tobacco products, specialised and customised professional technical services. The banking sector is also growing fast and represents an opportunity for investors. The government has expressed its desire to modernise the country's infrastructure, including hospitals and transport, and seeks to attract increased FDI.

Privatization Programmes

Mexico's Oil And Gas Industry privatization efforts have begun in 2015, following the privatization reforms introduced that year.

Tenders, Projects and Public Procurement

Sectors Where Investment Opportunities Are Fewer

Monopolistic Sectors

The following activities can only be carried out by the Mexican government:

Exploration and extraction of oil and other hydrocarbons (however, private investors can participate under a scheme that was initiated in 2015).

Planning and control of the national electricity system and provision of the electricity transmission and distribution public service.

Nuclear power generation.

Radioactive minerals.

Telegraphs, telegraphy and mail.

Currency issuance.

The control, supervision and surveillance of ports, airports and heliports

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Latest Update: February 2023

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Foreign investment in Mexico - Santandertrade.com

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In this page: FDI in Figures | What to consider if you invest in Mexico | Protection of Foreign Investment | Procedures Relative to Foreign Investment | Office Real Estate and Land Ownership | Investment Aid | Investment Opportunities | Sectors Where Investment Opportunities Are Fewer | Finding Assistance For Further Information Mexico is one of the emerging countries most open to foreign direct investment, the world's ninth largest FDI recipient.