Vol.
8 #2, November 2008
Mexico Market Update
 New
opportunities may exist in Mexico for Wisconsin companies in the energy
sector, specifically with the state-owned oil company Petroleos
Mexicanos (PEMEX), due in part to reforms proposed by President
Calderón’s administration. Mexico’s ownership
of this natural resource is guaranteed by the country’s
constitution, and opening any portion of the sector to foreign
investment is extremely controversial. President Calderón
has proposed allowing private investment in refining, storage and
transportation, with the goal of improving the technology and
increasing output. Mexico’s crude oil exports have been
declining since 2004, and without some reform this critical driver for
the Mexican economy is likely to continue to decline.
While Mexico has succeeded in recent years in diversifying its economy
away from relying entirely on oil exports and U.S. buyers for products
manufactured in Mexico, the country will face challenges during these
tough economic times. The slowdown in the U.S. market, still the
buyer of an estimated 75 percent of Mexico’s exports, will
inevitably hurt the Mexican economy as well. However, government
infrastructure projects in housing, ports, rail and highways are
expected to continue, providing opportunities for U.S. inputs and
equipment. GDP growth in Mexico is projected at 2.4 percent for
2008, and 3.4 percent in 2009.
Mexico continues to be the second largest export market for U.S. and
Wisconsin products after Canada. During the first two quarters of
this year, both Wisconsin and U.S. exports to Mexico grew by 11 percent
over the same time period last year. Top Wisconsin product
categories heading south include electrical and industrial machinery,
vehicle parts, plastics, and paper and paperboard. Industrial
machinery, a broad group of manufactured products included in the
harmonized tariff system chapter 84, has seen an export increase of
nearly 40 percent during the first half of this year.
According to the Country Commercial Guide for Mexico, updated annually
by the U.S. Commercial Service in Mexico, best prospect sectors include
automotive parts and supplies, electronic components, energy and
environmental, airport and ground support equipment, telecommunication,
security and safety, restaurant and hotel, transportation, and
low-income housing inputs. Within the agricultural market,
highlighted sectors include dairy products, red meat, poultry, and
fresh fruit.
If you would like information regarding opportunities in your industry
sector, please take advantage of the research resources available
through Wisconsin’s trade office in Mexico City. For more
information, contact Ms. Susan Dragotta, our Latin American Specialist,
susan.dragotta@wisconsin.gov, 262-691-5147.
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