Investment in Mexico, both national and international capital, would be closer to falling in the short term than to rebounding, considered Rafael de la Fuente, chief economist for Latin America at UBS, an investment banking financial institution.
De la Fuente stated that there is a lot of uncertainty in the business climate in Mexico, which would be one of the anchors that stops Foreign Direct Investment (FDI).
The uncertainty has to do with reforms such as the judicial reform or constitutional supremacy, and both would reduce the confidence of businessmen to inject capital into the country.
A possible victory by Donald Trump in the United States presidential elections and the fiscal policy of the Mexican government for next year would also influence.
“Not only foreign investment (would fall), but also domestic investment. In the last two years we have not seen a jump in investment,” commented Rafael de la Fuente from his office in Spain.
Another of the factors that the economist considered as determining factors for the Mexican business climate is the trade policy managed by the next administration in the US.
He commented that Trump’s threat of tariffs on Mexican products would cause a drop in exports, and therefore businessmen would stop investing in the country.
He assured that not everything is pessimism and that Claudia Sheinbaum’s government can reverse the situation by guaranteeing legal certainty and making decisions that give stability to businessmen.
He also pointed out that the relocation of industries in North America, a process known as nearshoring, will continue to be one of the main drivers of the Mexican economy, as long as respect for business is guaranteed.
FDI grew 7% to 31,096 million dollars (million dollars) between January and June, according to preliminary figures from the Ministry of Economy. However, the majority of the amount corresponded to reinvestments and not new capital injections.
On the other hand, fixed investment, an indicator that refers to the injection of capital to buy equipment for production, fell 1.9% in August compared to the previous month.
Although the government and businessmen have highlighted investment announcements, specialists point out that they must materialize in order to contribute to the development of the country.
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