Mexican outward FDI grew by 23% in 2009 but remained largely concentrated in the Latin American and North American markets, a study shows.

The Vale Columbia Centre for Sustainable International Investment, a US-based academic institution specialising in FDI, examined the largest Mexican companies in terms of foreign assets and found that the country’s outward FDI levels remain strong and are driven by a desire to diversify and raise competitiveness. The 23% gain for the year was preceded by growth of closer to 10% in 2008.

The report said: “Mexican companies also wanted to take advantage of the opportunities offered by economic liberalisation in Latin America and their background as exporters of manufactured goods. In Central America, they exploited low labour costs and, in the US and Europe, they exploited input quality and skilled labour. More recently, the strength of the Asian markets has begun to attract investment from some Mexican multinationals.”

The most globalised Mexican firms, according to the report, were Cemex, Bimbo, ALFA, Gruma and Mexichem.

The sectors benefiting the most from this growth, and recording the most FDI, were telecommunications and non-metallic minerals. Telecoms, which made up 40% of the investments, and non-metallic minerals have traditionally been the most robust Mexican FDI sectors. The food and beverage sector, which made up 10% of FDI, has also been a popular sector in the past.

The picture was not entirely rosy, however. The global crisis especially hurt Mexico's construction sector, which caused building materials company Cemex to sell some of its production plants in Austria and the US. Worsening conditions then caused the firm to sell another unit, its subsidiary in Australia, to the Holcim Group.

There were also mixed signals on job creation by Mexican firms. While the total employment figures of the country's top 20 companies fell by 13% in 2009, their foreign employment grew by 15%. Food company Grupo Bimbo was the country's top foreign employer, with 40,000 jobs overseas. It is also the largest Mexican employer in the US.

Overall, the report was positive on Mexico’s future prospects for FDI, but did criticise the government for what it saw as insufficient effort.

It said: “While the government has made serious efforts to develop policies designed to attract and promote inward investment in Mexico, it has made few such efforts to promote outward investment by Mexican companies.

“Since 1986, the Mexican government has focused its efforts on promoting exports, with the result that its economic strategy has leaned toward negotiating instruments such as the Nafta [North American Free-Trade Agreement]. The priority has been foreign trade, not investment abroad.”