Foreign investment into Mexico is up by 10.5% in the first quarter of 2011, according to the country’s economy department.

A statement from the government said that FDI in the period totalled $4.79bn, a 10.5% gain on the same time frame in 2010.


This investment was predominantly from the United States, which made up 85% of the $4.79bn. Switzerland was next at 8%, followed by Spain and Canada.

The majority of this investment was in the manufacturing sector. According to analysis from fDiBenchmark, the sector experienced strong growth from 2010 to 2011 and was one of the most cost-competitive locations for manufacturing.

As one of the highest growth industries in Mexico, GDP in industrial manufacturing grew by 7.4% in the first quarter of 2011, while average growth across all sectors in the country over the same period was 4.6%.

In terms of value of merchandise exported, Mexico was in the top three countries in the fDiBenchmark study with exports totalling nearly £300 billion in 2010. Only the US and Canada export more. Manufacturing accounts for over 75% of total merchandise exported from Mexico. Unlike in other Latin American nations in such as Brazil, Chile, Peru and Colombia, a rise in interest rates has not been necessary in Mexico to fight inflation. Inflation levels reached a 14-month low in the first quarter of 2011 and are on track to hit the 3% target by the end of the year.

When compared in a study of fifteen North and Latin American locations on fDiBenchmark, Mexico offers a highly competitive proposition in terms of cost. Labour costs are cheaper than in competing locations and are likely to be a key factor for many companies who locate labour-intensive manufacturing operations in Mexico. Labour is not only affordable but skilled and abundant. Mexico has a labour force of nearly 47 million, forecast to grow by 5% per annum until 2015, and has a comparatively high proportion of employment in industry; when ranking countries on their level of experienced industry-specific staff Mexico was second only to Peru.