Mexico; the answer for Chinese companies to the question of where to invest.

One of the main doubts of all Chinese companies is: Where can I establish my operations? To remain competitive and close to the end consumer. For many of these companies, the United States and the North American market is their target, however, it is not entirely clear which point is ideal based on economic, political and cultural aspects. But the answer is simple, Mexico is the place! Here we explain.

Mexico is currently one of the top 10 recipients of foreign direct investment (FDI) worldwide - according to the "World Investment Report 2022" published by the United Nations Conference on Trade and Development (UNCTAD) - it ranked in 2021 as the 10th global recipient of FDI and 5th among developing economies. According to figures from the Ministry of Economy (SE), in 2021 Mexico received US$31,621M of FDI, with most going to the manufacturing industry, followed by Financial Services and Mining.?

The countries that have invested the most in Mexico are, in first place, its partners in the Treaty between Mexico, the United States and Canada (T-MEC), followed by a significant number of countries in Europe (Netherlands, Spain, Belgium, Germany, United Kingdom, Luxembourg and Switzerland) and Asia (Japan).

So far from January to June 2022, FDI from China to Mexico is US$47.3M. Although this is still below the annual figure of 2021 that managed to reach US$386M, since 2016 we have seen an increase in the flow of investment from Chinese companies in our country. Highlighting the representative role played by states with experience in attracting FDI such as; Queretaro and Sonora which stand out as an attractive destination for Chinese investments.

In addition, Mexico's credit rating granted by the main rating agencies places it among the most reliable countries in Latin America as well as among the main blocks of emerging countries.

Even in the face of the various external shocks that generate uncertainty among investors, the performance of the main macroeconomic indicators, which are supported by a flexible exchange rate, a solid monetary and fiscal policy, a capitalized financial system, a moderate level of debt and an adequate level of international reserves, has allowed the country to maintain an investment grade rating by the main rating agencies.

It is important to highlight that, in Latin America, Mexico's exports represented 37.9% of the region's total in 2021, consolidating its position as the main exporting power. In particular, Mexican exports of medium and high technology manufacturing stand out, representing more than half of the region's exports.

Mexico has a solid and mature industry, mainly in sectors such as metal-mechanics, automotive, aerospace, electronics, among others. Consequently, Mexican exports of industrial goods and, in particular, those with high added value, have shown a notorious increase compared to oil products and raw materials.

Mexico has signed 14 free trade agreements (FTAs) with 50 countries and an Economic Partnership Agreement with Japan. Mexican products have preferential access to the world's main markets, which together represent more than 50% of the world's GDP and more than 1.1 billion inhabitants. In addition to these treaties, Mexico has a series of Economic Complementation Agreements, Partial Scope Agreements and Cooperation Agreements that make it one of the most open countries at the international level.

Without leaving aside that Mexico and China commemorated the 50th anniversary of the beginning of their diplomatic relations, which is transmitted in a mature relationship and with a series of public and private mechanisms established for cultural, academic and commercial exchange, among which the High Level Business Group stands out, where companies from both countries participate with the objective of strengthening the trade and investment relationship in a dialogue with authorities and business organizations.

COLLECTRON encourages foreign companies, particularly Chinese companies, to take advantage of the benefits offered by our country. In COLLECTRON we created the first Shelter program in Mexico more than 55 years ago, through which Chinese manufacturing companies can concentrate on their operations, research and development and business strategies. While our company will work to help them understand the prerequisites required to obtain Mexican business permits and operate legally in Mexico.

- Required permits such as corporate bylaws, powers of attorney and maquila contracts.

- Compliance with Mexican environmental agency requirements.

-Construction supervision and management of the construction works throughout the process.

- Coordination of leasing contracts for existing buildings.

- Recruiting the best personnel for your business.

- IMMEX permits.

- Inventory control.

- Among others.

We are pioneers in the maquiladora industry and have helped more than 295 companies start and operate their manufacturing operations in Mexico since 1968.?

Since we are the most experienced SHELTER operator in Mexico, we have the vision and foresight to anticipate your specific needs and provide customized solutions to execute your program quickly and efficiently.