Mexico – The Gateway to Latin American Markets
Mexico is a very diverse and huge market, more importantly it is strategically the gateway to tap the entire Latin American markets with much needed safety and security, says Sumeet Sharma.
To tap the entire Latin American markets with much needed safety and security
Trade & Invest
Consider these very relevant facts and statistics which will help understand the potential of Mexico for business promotion opportunities – key reasons why relevant Indian companies should consider exporting to Mexico:
- Mexico is the 15th largest economy in the world
- Given Mexico’s large, diversified market, most Indian products can be sold successfully, since it is a member of NAFTA and MERCOSUR thus becoming the most strategic location in the American continent
- Mexico continues to experience stable economic growth
- Recent economic reforms have liberalised key sectors including: Consumer goods, energy and telecommunications, creating market opportunities
- Mexico’s USD 1.1 trillion economy makes it the second largest economy in Latin America and the 15th largest economy in the world. The International Monetary Fund (IMF) recently revised the country’s estimated real GDP growth from 1.9 per cent to 2.1 per cent in 2018, and
- Today, many Indian manufactured products are exported to Mexico with 2017-18 counting 12 billion USD worth of exports from India to Mexico.
Traditionally the leading sectors for Indian exports to Mexico have been: Automobiles, Auto-components, Engineered components, Pharma & Chemicals, Plastics and Resins, Textiles and apparels.
Mexico is a member of the World Trade Organisation (WTO), Asia-Pacific Economic Cooperation (APEC), the G-20, and the Organisation for Economic Cooperation and Development (OECD). Mexico has more free trade agreements (FTAs) than any other country in the world – 12 FTAs covering 46 countries – which include the European Union, European Free Trade Area, Japan, the Pacific Alliance, Israel, and ten countries in Latin America. On March 8, 2018, 11 Asia Pacific countries including Mexico signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP, formerly known as the Trans-Pacific Partnership). The Mexican Senate ratified this agreement April 24, 2018.
For Indian exporters, Mexico’s participation in these international agreements means that in general the Mexican market is one of the most open and competitive in the world. Other statistical highlights include:
- Mexico is the most populous Spanish speaking country in the world
- Seventy-nine per cent of its 125 million inhabitants live in urban areas
- Ten per cent of the population is considered wealthy, and about 44 per cent lives in poverty
- The remaining 46 per cent of the population is considered middle class
- Mexico has a very young population with a median age of 28, and
- It offers a large market with a GDP estimated by the International Monetary Fund (IMF) of approximately USD 1.1 trillion, and a 2017 estimated per-capita income of USD 9,304 (or USD 19,900 on purchasing power parity basis). There is a large manufacturing base in a wide range of sectors.
Mexico is ranked in the top 10 markets in the world for consumer goods, cosmetics, personal care and home improvement products, and it continues to be the second-largest market for beauty products in Latin America. Due to a strengthening economy and a variety of both domestic and imported brands, consumption of cosmetics in Mexico has grown steadily over the past 15 years, according to Euromonitor.
Leading Indian Consumer goods manufacturers have long known the potential of Mexican markets but have shied off from venturing there for lack of knowledge and correct contacts to have strong local representation and this is the vacuum we fill perfectly. Parle Foods have recently ventured into Mexico by setting up a manufacturing plant to cater to Mexico and Latin America.
ALITPO – America Latina India Trade Promotion Organisation – facilitates multilateral trade growth between India and Latin America. ALITPO is based at Monterrey, which is the most industrialised city in Mexico, just two hours drive from the US border. Monterrey has been mentioned by Fortune magazine as the best city to do business in Latin America.
Now through its India Mexico Export Trade Promotion Initiative (IMETPI), ALITPO has organised a Trade Delegation to Mexico in March 2019.
Indian manufactured products serve the need of local end product manufacturers always looking at and welcoming connects for product sourcing which helps them increase their profit margins. Leading Supermarket Chains in Mexico with excellent reach all across Mexico and Industrial Sector specific buyers are participating at the events organised for the IMETPI Trade Delegation event to explore the business opportunities.
Planning and executing the Market Entry strategy for Mexico is the most important and exhaustive task for the adventurous Exporter Entrepreneur desiring to grow his business to Mexico and Latin America and reap the rich benefits offered by these prime mark-up markets of the world. ALITPO, with its extensive reach and contacts in Mexico and Latin America, provides complete support with Turnkey Solutions in Greenfield investments, JVs – Collaborations, Operations and Management for the evolved SMEs.
ALITPO is not just a ‘Buyer Seller Meet’ organiser, but is an entity based in Mexico with the intent to facilitate and serve the complete needs of Indian manufacturers to gain access, sustain and grow their business in Mexico and Latin America. Buyers in Mexico prefer the convenience and security offered by ALITPO in identifying and representing good quality manufacturers from India. For the Indian Manufacturer/Exporter ALITPO serves their need of local legal and market compliances, local warehousing and logistics facilities, payments and receivables and most importantly, market development for their products.
The Trade Delegation is just the first step and the Buyer Seller Meet where participants will meet buyers for their products and services.
In the second step, ALITPO will help complete the deal with prospective buyers and continue market development for the products and services in Mexico and Latin America.
The Key Sectors attractive for Indian exports, to name only few of the most in demand and with high growth potential range from:
- Automotive Components manufactured by the OEMs in India
- Engineering & Engineered Components
- Equipment & Supplies to the Petro-Chemicals and Pharmaceutical Industries
- Textiles & Apparel
- Beauty – Wellness and Health Care Products
- FMCG – Processed Food Products
- Electronics, Electrical & Renewable Energy sector related Products & Services
- Plastics & Resins, and
- Rubber Products & Compounds.
Indian corporates like TCS, Infosys, TATA Group, Bajaj, Mahindra, JK Files, among others, have strong presence in Mexico.
In the latest development, the new government of Mexico has plans to seek technology for a petroleum refinery from the Reliance Jamnagar plant.
Pix1: Mexico’s USD 1.1 trillion economy makes it the second largest economy in Latin America.
Pix2: Traditionally the leading sectors for Indian exports to Mexico have been automobiles and auto-components, among others.
He is the Founder & CEO, ALITPO, has worked and lived in Mexico and has garnered rich experiences and learnt important statistical facts about Mexican businesses and Latin American Companies for the past 15 years. He may be reached by mobile at 91-9820998399.