FDI has generated a large movement of capital in search of nearshoring opportunities: Grupo Financiero Base

Monterrey, NL. The figures of the Foreign direct investment (FDI) show a great movement derived from the arrival of flows that seek opportunities through the nearshoring, while others leave because of uncertainty. If foreigners were not withdrawing fixed investments in Mexico, this year FDI would reach a historical maximum level, instead, a growth of 17% is expected, with FDI of 37,000 million dollars.

This is indicated by an analysis of the Economic Outlook for the third quarter of Grupo Financiero Base.

In the case of Nuevo León, the trend of nearshoring influenced so that from 2020 to December 2021 the IED position the state in second place nationally, with 9.4% of the national total, said Jorge Lera Mejía, research professor at the Autonomous University of Tamaulipas (UAT).

The UAT specialist indicated that during 2020 and until December 2021, Mexico City concentrated 16.5% of the national total. In the first semester, the capital of the country obtained the first place in attracting FDI with 9,000 million dollars and Nuevo León captured 2,661.3 million dollars.

“Without the disinvestments of foreigners and with the nearshoring opportunity, Mexico could reach this year a historical flow of FDI slightly higher than 50,000 million dollars, but it is expected to be only 37,000 million dollars, since it is estimated that the flow will continue. exit of foreigners due to disinvestment”, assured Grupo Financiero Base.

By state entity, FDI growth in the first semester was concentrated in Mexico City with 126.8% annual, due to an extraordinary movement related to the merger of Televisa and Univisión and the restructuring of Aeroméxico, which together represented 6,875.0 million dollars, 49.2% compared to the same period.

“A strong annual growth of FDI related to manufacturing and the service sector is also observed in Nuevo León with 45.0%, Jalisco with 64.5%, State of Mexico with 43.5%, Tamaulipas with 78.3% and Querétaro with an annual growth of 50.7 percent.

“States such as Chihuahua, Baja California and Guanajuato, although they do not show annual growth in the first half of the year, reflect two consecutive years of FDI at levels that exceed the flows prior to 2021”, emphasized Grupo Financiero Base.

Nuevo León after nearshoring

The UAT researcher explained to The Economist that the impact of new foreign investments on the border have been exponentially multiplied by the breakdown of supply chains, for this reason the practice of offshoring (transfer your business processes to third parties located in distant destinations) for the nearshoring (bring part of the production close to the customer).

“Therefore, the entrepreneurs of the northeast border: New Lion, Coahuila y Tamaulipas They have benefited from the relocation, since the production of China and Europe seeks to reduce costs to supply the main market in the United States”, he deepened.

Some real estate consulting firms explain that in Tijuana y Juarez Citythere are few areas available to build new industrial buildings.

In Nuevo León, Colliers Monterrey has monitored 117 industrial properties totaling 1.5 million square meters under construction and 1.1 million square meters in planning, to enter the market in the next two years.

The corridors with the largest construction space for industrial buildings are in: Santa Catarinawith 82,656 square meters, followed by Apodacawith 71,507 square meters, according to the Colliers Industrial Market Report, for the third quarter.

“By 2022 it is estimated that FDI will close at a level of 37,000 million dollars, which implies an annual growth of 17.39%. By 2023, assuming outflows continue and the timing of the nearshoring decreases due to lower logistics costs of imports from the rest of the world, it is estimated that FDI could grow 12%, reaching a level of 41,440 million dollars”, highlighted the analysis of Grupo Financiero Base.