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Mexico • February 2, 2024 • Written by: Ongresso - Business Beyond Borders
With the start of the new year 2024, all eyes are on México, the second-biggest economy in Latin America, to see how it will develop by 2024. With notable economic growth, a crucial presidential election, and a notable increase in foreign direct investments (FDI), this year has a lot of promise.
Political Environment
- A democratic and legal framework is anticipated to govern the course of the next presidential election.
- Whatever the election result, analysts predict that there will be few significant threats to macroeconomic stability.
- The political landscape appears stable based on recent polls.
Important factors for 2024:
- From January to September 2023, there was a significant 47% increase in Foreign Direct Investment (FDI) associated with nearshoring, according to the Institute Mexicano para la Competitividad (IMCO).
- 57 industrial branches in six different sectors that are directly related to nearshoring, and these branches have invested a total of $15 billion over this time.
- Stability in the economy is facilitated by record public spending.
- Growth is anticipated to be fueled by government initiatives, investment, and private consumption.
General government expenditure of Mexico from 2006 to 2028
Vision of the Government:
- Increased private consumption and strong public and private sector investment are key components of the government's ambitious GDP growth projection of 2.5% to 3.5% for 2024.
- In line with investor interests, social programs such as increased pensions and minimum wages are designed to stimulate household consumption.
Mexico: Gross domestic product (GDP) in current prices from 1987 to 2028
The forecast from the Bank of Mexico
- The Bank of Mexico's updated growth estimate for 2024, which ranges from 2.3% to 3.7%, fits with the expansionary fiscal policies that indicate a favorable investment environment.
- The first half of the year is expected to see stronger economic activity, which fits in perfectly with previous election-year patterns.
Global Partnerships
- With Japanese FDI reaching 2.39 billion $, mostly in the automotive industry, Japan demonstrates its commitment and offers astute investors lucrative opportunities.
- With a $237 million contribution from January to September 2023—a five-fold increase from the previous year—Chile bravely enters the Mexican investment scene.
- Hong Kong becomes more prominent, indicating that its proportion of FDI in Mexico is increasing.
Mexico is a shining example of resiliency and a prosperous haven for investors in 2024, full of opportunities for astute observers. Investors are invited to join Mexico in its economic journey, navigating with confidence and seizing the promise of unmatched growth, thanks to the interaction of nearshoring dynamics, regional triumphs, and emerging global partnerships.
Call us now, to invest in México's thriving opportunities