Analysis

Mexico's government looks to diversify trade partners
OBG
plus

Given that Mexico shares a long land border with the largest economy in the world, and that, particularly since the North American Free Trade Agreement (NAFTA) came into force in 1994, barriers to trade and investment between the two countries are minimal, it is natural that the US would be Mexico’s most important economic partner. These linkages are particularly striking in the sphere of exports,…

Analysis

Mexico focuses on increasing investment inflows to more regions in the country
OBG
plus

Given Mexico’s location on the doorstep of the world’s largest economy, its low unit labour costs, and its openness to trade and investment, the country has become a manufacturing hub serving the US and other markets. Since the North American Free Trade Agreement (NAFTA) was implemented in 1994, the country has become deeply integrated into North American supply chains, becoming a leading exporter…

Analysis

Incentivising Mexico's formal banking activity remains major priority
OBG
plus

Since the economic, financial and banking crisis of 1994-95, many Mexicans have lacked full confidence in the integrity of the banking system. It shrunk greatly during and immediately after the crisis. In the intervening years, banking regulations have been greatly tightened, foreign entrants to the sector have come to dominate, and credit as a share of the national economy finally appears to have…

Analysis

Mexico's central bank works to keep inflation in check
OBG
plus

Having been plagued by chronic high inflation and periodic crisis until the mid-1990s, Mexico turned to economic liberalisation in the wake of the 1994-95 “Tequila crisis”. Among the important reforms was the granting of independence to the central bank, Banco de México (Banxico), in the operation of monetary policy, along with a clear mandate to control inflation above all other policy considerations.…

Analysis

Infrastructure bonds
OBG
plus

Private equity in Mexico has achieved over $42.5bn in capital commitments over the past 16 years, expanding at a compound annual growth rate of 20.27%. In 2016 nine development capital certificates ( certificados de capital de desarrollo, CKDs) were issued, three of which were for infrastructure and energy, two for real estate, one for venture capital and three for private equity. Additionally, the…

Analysis

Stock market
OBG
plus

From primary public and debt offerings to more sophisticated instruments, the various financing options on the Mexican Stock Exchange (Bolsa Mexicana de Valores, BMV) are diverse. Many of the BMV’s offerings are a sound option for obtaining financing. As the stock market allows individuals and organisations to multiply their savings through the contribution of capital to finance a wide array of…

Analysis

Retirement & pension funds
OBG
plus

Pensions and their equitable distribution have been relevant for many years in countries around the world. In Mexico the pension system consists of four components: federal and state social pensions, the Retirement Savings System (Sistema de Ahorro para el Retiro, SAR); special pensions for some public employees and universities; and voluntary individual pension plans. Recent Reform Until the mid-1990s,…

Analysis

New bourse in Mexico to offer more options and deeper market
OBG
plus

With listings, market capitalisation and liquidity in Mexico far below what would be expected in an economy of its size and development, financial market services firm Central de Corretajes (CENCOR) spotted a market opportunity and has been working to set up a second bourse to operate alongside the long-established Mexican Stock Exchange (Bolsa Mexicana de Valores, BMV). Since 2013, CENCOR has been…

Analysis

Mexico's auto insurance companies look to increase uptake
OBG
plus

Mexico is one of the few countries where there is no mandatory legal requirement for all drivers to be insured at all times. It is perhaps unsurprising therefore that, according to the Mexican Association of Insurance Companies (Asociación Mexicana de Instituciones de Seguros, AMIS), only 27% of cars in the country were insured in 2016, down marginally from 28% a year previously. This is strikingly…

Analysis

Investment in Mexico's renewables projects to lead to increase in solar, wind capacity
OBG
plus

While the shift in the political relations with the US has raised new concerns on a number of economical fronts, Mexico’s plans to make the most of its renewable energy resources will benefit both the country itself and its northern neighbour. A significant increase in the contribution of solar and wind into the energy mix is expected in the 2017-18 period. Towards A Greener Mix Pedro Joaquín…