Despite some adverse conditions facing Mexico at the moment (cough Trump cough), the Mexican government has kept up its steady promotion of the country as a destination for foreign direct investment. A couple of high-profile investments in the automotive industry appear to have been waylaid by threats or uncertainty over the future of NAFTA, but overall large foreign companies with long-term strategies for the Americas continue to establish new Mexico operations or expand existing ones. Within this context, we once again took a look at the less-heralded flip side of Mexico FDI – investment by Mexican companies in other countries. Read the rest of this entry »
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Since the election of Donald Trump as President of the United States, concern over how this will affect Mexico has vaulted to the forefront of public debate on this side of the border. We worry about all the new problems we (probably? maybe?) will have from topics on the table such as NAFTA repeal, mass deportations, the border wall, etc. We wring our hands publicly about the plight of Mexican migrants in the USA, but mostly we’re thinking about what will become of us here at home. For this reason, we asked a colleague based in the United States to provide us some perspective from north of the border, particularly with regard to the impact on binational families such as his. Journalist Steve Cannon lived in Mexico City for many years before moving to the United States with his family in 2016. As a family including both U.S. and Mexico passport holders – of which there are many in both countries – the Cannons now face challenges and uncertainty that may not have seemed apparent before last November’s presidential election. Mexico Business Blog greatly appreciates the thoughts that Steve has shared with us, which follow below. Read the rest of this entry »
Repeat visitors to this space will know that this is not a travel blog. We are much more likely to discuss natural gas pipelines than to wax about resorts and yoga on the beach at sunrise, preferring to leave those complicated topics to skilled specialists such as Cancun Canuck and Mexican at Heart. Nonetheless, tourism is one of the most important sectors of the Mexican economy, so it is fair game. With this in mind, we took advantage of the recent holiday period to head up to the state of Baja California Sur to do some research on two critically important market sectors: fish tacos and beer. Our fieldwork revealed that Baja is a great place to visit! And along the way, we also observed some interesting quirks about the local economy. Read the rest of this entry »
When looking at the retail industry in Mexico, it appears that the country’s efforts to move into e-commerce have to be the most important trend currently. Mexico is still playing catch-up to its North American neighbors in the transition to on-line sales, facing hurdles such as low credit card penetration and a strong perception among consumers of high fraud risk in electronic purchases. But while our e-commerce marketplace sorts out its issues, brick-and-mortar stores continue to play a leading role in Mexican retail, and reshuffling among leading chains as well as the entry of foreign chains into the market is driving continued evolution of the retail landscape.
Over the past 20 years, the entry of Walmart into the Mexican market in the 1990s and the rise of regional chains to national prominence has upset the balance of power in the industry. Back in 2007, Gigante, one of the country’s dominant supermarket operators, marked a turning point when it sold its 205 grocery stores to emerging northern rival Soriana. The move effectively signified Gigante’s departure from grocery and general merchandise retailing, although Gigante remained in the retail market operating smaller specialty store chains, and announced Soriana’s entry to the nationally dominant group. In 2015, Soriana further solidified its position in the market with another aggressive move when it acquired 160 grocery stores and three distribution centers from leading retailer Comercial Mexicana. While Comercial Mexicana, now called La Comer, remains in the game to focus on a smaller number of more specialized retail formats, the acquisition by Soriana further cements the Monterrey-based chain’s nationwide presence. Read the rest of this entry »
We were positively gobsmacked when the news hit that the British electorate had voted to leave the European Union in the UK referendum held June 23, 2016. We should add that when new Prime Minister Theresa May subsequently named Boris Johnson Foreign Secretary, we were whatever comes after gobsmacked in the hierarchy of silly English expressions, but we’ll save that topic for another post. Not being stuffy pensioners in the Midlands, our prime concern over Brexit is the historical context for peace and prosperity in a unified Europe, and by extension the world. After all, the history of Europe is largely the history of thousands of years of uninterrupted warfare until the EU’s monumental attempt to pacify the region through cooperation following World War II. A handful of billion Euros here and there seems like a small price to pay for the opportunity for peace in Europe, but hey, what do we know here in the tropics. In any case, as British millennials figuratively jumped off the roof in the aftermath of the vote, we naturally began wondering how Brexit would affect us in Mexico, despite being neither British nor European.