Mexico Economic Climate

The expression goes, “If America sneezes, Mexico catches a cold”. With the potential American debt crisis looming, my judgment is that Mexico will not only whether the storm but may lead Latin America economically. First, doing business in Mexico is much easier than a decade ago when trade barriers and governmental policies were in place. Second, many Mexican multinationals are flush with cash and investing in operations domestically and abroad. Cemex, the third largest cement company in the world stock has grown by 8.53%. Others showing growth include Empresas, Grupo Mexico, and Gruma. Pemex is building its first refinery in over 30 years and should open by 2016. Last, Government agencies are flush with cash and are willing to spend through the end of the year.

If Mexico does catch pneumonia, its because the US is still a major importer of goods. Brazil and Chile benefitted from Chinese demand but that growth may slow. Mexico is still reeling from a recession but the government plans on keeping interest rates low. Next year is an election year that brings uncertainty into the markets and will be a factor.


About Cameron Ackbury, CPA

Founding Director at DaggerFoil Group
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