Alliance 21

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56

EDITORIAL COUNCIL UNITED STATES - MEXICO CHAMBER OF COMMERCE

Editorial

Albert C. Zapanta, President & CEO, Binational Headquarters; Francisco López Espinoza, CEO, Grupo Gráfico Multicolor; Eric Rojo, Vice-President/ Mexico Liaison; Joseph R. Chapa, Vice-President, International Trade Development Centers; Gabriela Kenny, Director of Communications; Cecilia López, Publishing Manager; Jill Martínez, Editor.

Dear friends,

PUBLISHING COORDINATORS Executive Director PROMEXE Rafael López Rivera rafa.lopez@multicolorig.com Director of Communications Gabriela Kenny gabriela.kenny@usmcoc.org Publishing Manager Cecilia López ceci.lopez@usmcoc.org

CONCEPT & MAGAZINE DESIGN Editorial Coordinator Yolanda Ivette Castillo Vázquez icastillo@promexe.com Graphic Designer Areli Jeanette Sayas Hernández asayas@promexe.com

EDITORIAL CONTRIBUTORS Jill Martinez Marinana Rossell Pedro Linares Yesenia Ramos Curiel Claudia Vidal Gabriela Michan

Andres Quiala Sergio Ponce Pete Garcia Blanca Berthier Josie Orosco Marlen Marroquin

PRINTED BY

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hat a great pleasure to meet again through the pages of this edition of Alliance Magazine, the official publication of the United States-Mexico Chamber of Commerce, designed to present insightful information about developments relevant to the U.S.-Mexico relationship, and share with our members and friends our activities, programs and projects.

I am proud to share with you the inauguration of the Good Neighbor Inspirational Awards, which was conceived after meeting two outstanding Paralympic athletes, Mallory Weggemann, professional swimmer from the United States, and Arly Velásquez, professional alpine skier from Mexico.

These young and determined athletes have shown enormous strength and determination in pursuing their goals. Their achievements have inspired us to create an award to distinguish those who have overcome great challenges, and present their testimony as a vital reminder that no matter what obstacles stand in our way, we should not give up following our dreams. In these pages you will find their stories. I am sure you will also find them a source of inspiration.

Legal reforms in Mexico continue to be an ongoing topic of discussion; Congress has already approved important changes to the Constitution, so now it is time to translate those reforms into new regulations and implement them. In this issue, you will find a snapshot of the tax reforms and advice on approaching the energy reform with caution without losing sight of the great opportunities that lie ahead.

You will also find an account of the North American Leaders Summit that took place last February in the city of Toluca, Estado de Mexico. Canadian Prime Minister Stephen Harper, U.S President Barak Obama, and Mexico President Enrique Peña Nieto renewed their commitment to making North America the most competitive region in the world.

For advertising inquiries, contact: Rafael López rafa.lopez@multicolorig.com Executive Director PROMEXE Gabriela Kenny gabriela.kenny@usmcoc.org Director of Communications Cecilia López ceci.lopez@usmcoc.org Publishing Manager

ALLIANCE LA REVISTA DE NEGOCIOS BINACIONAL, Año 10, No. 21, mayo– agosto 2014, es una publicación cuatrimestral editada por Promotora Mexicana de Ediciones, S.A. De C.V. Oficina Aguascalientes: Av. José María Chávez No. 3408-A, Ciudad Industrial, C.P. 20290. Aguascalientes, Ags. México. Tel.: 52 (449) 971 24 42. Fax: 52 (449)913 37 52. www.promexe.com, cecilopez@mac.com.

Editor responsable: José Rafael López Rivera. Reservas de Derechos al Uso Exclusivo No. 04-2013-071518324800-102, ISSN: En Trámite, ambos otorgados por el Instituto Nacional del Derecho de Autor, Licitud de Título y contenido 16157, otorgado por la Comisión Calificadora de Publicaciones y Revistas Ilustradas de la Secretaría de Gobernación.

Impresa por Multicolor Gran Formato S.A. de C.V. Tel.: 52 (449)913 37 52. Fax.: 52 (449) 913 30 04. Av. José María Chávez No. 3408-A, Ciudad Industrial, C.P. 20290. Aguascalientes, Ags. Distribuidor: Promotora Mexicana de Ediciones, S.A. de C.V., (PROMEXE) este número se terminó de imprimir el 30 de abril de 2014 con un tiraje de 3,000 ejemplares. Las opiniones expresadas por los autores no necesariamente reflejan la postura del editor de la publicación.

Queda estrictamente prohibida la reproducción total o parcial de los contenidos e imágenes de la publicación sin previa autorización de Promotora Mexicana de Ediciones, S.A.de C.V.

After our binational meeting in November of last year, and for this edition, we had the opportunity to interview the Mayor of Mexico City, Miguel Angel Mancera Espinosa, who shared with us his program to attract investment to the Distrito Federal. The November event also led to an invitation for the USMCOC to support the program, Mis Raíces, designed to attract Mexicans and Mexican-Americans with ties to the City, to return for a visit. So I would like to take this opportunity to invite you all to visit the wonderful Ciudad de México.

Thank you to all who contributed articles for this edition and to our sponsors for making it possible to maintain this channel of communication with our friends and members.

Finally, we are approaching our Annual Meeting, Binational Conference and Good Neighbor Awards Gala mid-May of this year. I look forward to seeing you there. Also, please mark your calendars for our North American Sustainable Economic Development Summit August 25-26, at the Four Seasons Hotel & Resort in Las Colinas-Irving, TX, and our Bi-national Meeting in Queretaro and Mexico City October 27-29

Sincerely

Albert Zapanta President & CEO

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CHAPTER OFFICES

OFICINAS DEL CAPÍTULO

TECHNOLOGY TRENDS

TENDENCIAS TECNOLÓGICAS

4 5

ADVERTORIAL

13

THE COVER

20

ARTÍCULO DE PORTADA

Good Neighbor Inspirational Award

OPINION OPINIÓN

BREVES

6 8

PUBLIREPORTAJE

BRIEFS

OF INTEREST DE INTERÉS

26

CHAPTER ACTIVITIES

38

INTERVIEW

ACTIVIDADES DEL CAPÍTULO

ENTREVISTA

42 • Mexico’s Social and Fiscal Reform • Energy Reform: Scope & Business Opportunities in Mexico

50 52 2

MEMBER HIGHLIGHTS

MIEMBRO DESTACADO

UPCOMING EVENTS PRÓXIMOS EVENTOS

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CHAPTER OFFICES THE AMBASSADOR OF GOOD BUSINESS www.usmcoc.org

CHAPTER OFFICES / OFICINAS DEL CAPÍTULO

Al Zapanta President & CEO zapantaz@usmcoc.org Tel: (703) 752 4751 Fax: (703) 642 1088

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Joe Chapa Vice-President International Trade Development Centers jrchapa@usmcoc.org Tel: (214) 329 4559 Fax: (703) 642 1088

Gabriela Kenny Director of Communications gabriela.kenny@usmcoc.org Tel: (703) 752 4751 x 107 Fax: (703) 642 1088

BINATIONAL HEADQUARTERS / OFICINAS GENERALES 6800 Versar Center. Ste. 450 Springfield, VA 22151 Mail to: P.O. Box 14414, Washington, D.C. 20044

Northeast Chapter New York, NY Eduardo Ramos-Gómez President Alejandro Ramos Executive Director 1540 Broadway, Suite 1400 New York, NY. 10036-4086 Tel: (212) 471 4703 Fax: (212) 471 4701 alejandro@usmcocne.org

California Regional Chapter Los Angeles, CA Jim MacLellan President Marlen Marroquin Executive Director 1800 Century Park East Suite 300 Los Angeles, CA 90067 Tel: (310) 598 4188 marlen@usmcocca.org

Valle de México Chapter Mexico City Jose Garcia Torres President Claudia Vidal Executive Director Av. Insurgentes Sur 1605 Torre Mural, Piso 25, Mod. 3 Col. San José Insurgentes Benito Juárez, 03900. México, D.F. Tel: (55) 5662 6103 Fax: (55) 5683 2700 c_vidal@usmcoc.org

Noreste Chapter Monterrey, N.L. Dr. Eric W. Gustafson President Roberto Fuerte Executive Director Av. Fundidora No. 501.

Edificio Cintermex P.B. Local 114 Col. Obrera Monterrey, N.L. 64010 Tel: (81) 8191 7800 rfuerte@usmcocmtymx.org rfuerte@gmail.com

Mid-America Chapter Chicago, IL Gery Chico President Blanca Berthier Executive Director Blue Cross Blue Shield Building 300 E. Randolph Dr. 49th floor Chicago, Il 60601 Tel: (312) 729 1355 / (312) 729 1356 Fax: (312) 729 1354 blanca.berthier@usmcoc.org

Southwest Chapter Dallas, TX Vincent Chapa President Josie Orosco Executive Director 901 Main Street, 44th. Floor Dallas, TX 75202 Tel: (214) 651-4300 / (817) 881 0264 Fax: (214) 747 1994 swusmx@netzero.com

Pacífico Chapter Guadalajara, Jal Francisco Plancarte y García Naranjo President Pedro Fernando Linares Executive Director Av. Américas 1592, Piso 5, Edf. Country Club Col. Country Club, CP. 44637 Guadalajara, Jalisco, México Tel: (33) 1502 8038 pedrolinares.usmcocpacifico@gmail.com

Puebla Chapter Puebla, Pue. Fernando Treviño President Vidaur Mora Executive Director 31 Poniente No. 4128 2-B Col. Reforma Sur Puebla, Pue. 72160 Tel: (222) 249 8828 Fax: (222) 249 2361 puebla@usmcoc.org www.usmcocpue.org

Mid-Atlantic Chapter Washington, D.C. Vacant Trade Representative 6800 Versar Center, Suite 450 Springfield, VA 22151 Tel: (703) 752 4752 Fax: (703) 642 1088 gabriela.kenny@usmcoc.org

Inter-American Chapter Miami, FL Michael Ronan President Susanna Werner Interim Executive Director 1441 Brickell Ave. Suite 1400 Miami, FL 33131 Tel: (305) 374 7401 Interamerican@usmcoc.org

Guanajuato Chapter León, Gto. Joseph Ramiro Chapa García President Sergio Ponce López Executive Director Blvd. Campestre No. 1215, Int. 12 Col. Panorama León, Gto. 37160 Tel: (477) 779 5670 Fax: (477) 779 5671 sergio.ponce@usmcoc.org www.cplb.org

Aguascalientes Chapter Aguascalientes, Ags. Jaime del Conde Ugarte Presidente Rodolfo Rodríguez Casillas Executive Director Av. Independencia 1602 Col. Fátima Aguascalientes, Ags. Tel.: (449) 914 6863 y (449) 153 3553 www.usmcocags.com.mx

Pacific Northwest Chapter Seattle, WA Luis Morris Velarde President 15100 S.E. 38th Street # 728 Bellevue, WA 98006-1765 Tel: (253) 678-7696 lmorris@usmcocnw.org

The Woodlands - Gulf Coast Chapter, The Woodlands, TX Ronda Butler-Harkey President Pete C. Garcia Executive Director 2211 Norfolk St Suite 520 PO Box 541330 Houston, Texas 77098 petegarcia@usmcocgc.org

Golfo Chapter Veracruz, Ver. Andres Quiala President Jorge Alejandro Vega Executive Director Simon Bolivar no. 705. casi esquina con España.

Despacho 3 Colonia Zaragoza C.P. 91910 Veracruz, Ver. México Tel: (229) 937 0598 Fax: (229) 100 3857 aquiala@usmcoc.org

Querétaro Chapter Querétaro, Qro. Marcela Soto Executive Director Isas y Asociados Contadores Públicos Rufino Tamayo # 2 Col. Pueblo Nuevo Querétaro, Qro. 76900 Tel: (442) 295 0272 msoto@usmcoc-qc.org.mx

International Trade Development and Assistance Center Joe Chapa Executive Director 207 Mandalay Canal Irving, TX 75039 Tel: (406) 839 1796 jrchapa@usmcoc.org

Michoacan Chapter Morelia, Mich.

Nick Ortiz President nick.ortiz@usmcoc.org Lucy Chávez Executive Director usmcocmich@gmail.com Melo 166-B Morelia Michoacan C.P. 58000 Tel: (443) 353 2927

BRI ABC Medical Center Opens EFS

Molecular Pathology Laboratory

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he ABC Cancer Center, a department of the ABC Medical Center in Mexico City, has installed a molecular pathology laboratory to aid in diagnosis and treatment of certain types of cancer.

Molecular testing provides information that cannot be obtained through traditional pathology assessment. This testing impacts the management of patients with lymphoid neoplasms in four different areas: 1. Greater precision in diagnosis.

2. Identification of treatments aimed at specific molecular targets 3. Determination of prognosis

4. Monitoring of treatment through detection of minimal residual disease.

The efficacy and impacts of this project will be measured by the number of research studies that correspond, in most cases, to the number of beneficiaries. The projections include private and charity patients.

The ABC Cancer Center’s charity care program is currently focusing its efforts on young people between 10 and 30 years of age, but patients of any age are accepted.

This donation that will give many people victims of mantle cell lymphoma, the chance to live a better life.

Infrastructure Projects in Mexico Cardel – Poza Rica Highway Sponsor: Ministry of Communication and Transport (SCT) Location:Veracruz Project Value: $287 million

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he project consists of the construction of a 78-mile highway with two circulation lanes between the cities of Laguna Verde and Gutiérrez Zamora, in the Veracruz state. Its goal is to serve 3,000 vehicles a day and speed up the transit along the Veracruz-Matamoros Corridor, which will link to the Brownsville,TX border crossing, in order to boost economic and tourist development in the area.

Business opportunities: civil engineering, construction materials, construction equipment, signaling, traffic equipment.

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al-Mart Mexico will invest $1.13 billion to expand its footprint in Mexico. The company will spend more than half of that sum in opening new stores, increasing its floor space by 5.2 percent from 2013, and the rest on remodeling existing stores and investing in its e-commerce infrastructure to improve grocery delivery. Wal-Mart Mexico generates around $27 billion in annual sales, which accounts for 6 percent of the Arkansas-based Walmart’s global sales.

Source: NAFTA Works, A Monthly Newsletter on NAFTA and Related Issues, March 2014, Volume 19, Issue 2.

BRIEFS / BREVES

Wal-Mart expands investment in Mexico

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The Future of Financial Services in a Connected Digital World

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n his 1999 book, The Age of Spiritual Machines, Ray Kurzweil describes the exponential growth of technology—the speed of change is always accelerating; therefore, it will take only two years for the world to change as much as it had in the past 10 years. This is often difficult for people to understand as we tend to forecast the future by extrapolating the past in a linear way and, as a result, companies and industries are repeatedly caught off guard.

Growing Connectivity One of the biggest areas of technology transformation—one that is likely to dwarf the first wave of Internet and e-commerce— is the arrival of the “Internet of Things” where computers, machines and inanimate objects will now be connected to the digital world through embedded sensors and then, progressively, the products ranging from cars to homes, to clothes, to manufacturing equipment, will “light up.”

Consider, for example, the effect of evolving automobile technology on the insurance industry. With cars equipped with accident prevention capabilities that brake on their own when they detect a possible accident and cars able to “drive” themselves (the Google car, for example), it is safe to assume that the number of accidents will decrease significantly in the future—and possibly disappear. Will the auto insurance industry disappear as well or will it transform itself by providing

SMARTPHONE USERS IN MEXICO, 2012-2017 millions, % of population and % change

54.4

6

40.4 Smartphone users

TECHNOLOGY TRENDS / TENDENCIAS TECNOLÓGICAS

47.3

27.2 18.4

2013

2014

% of population

2015

The same can be said of the connected home and the promise of offering bundled services including home insurance, home security, elderly monitoring and even home repair services.

Mobile Commerce and Digital Currency On another front, the mobile commerce transformation has started: banks are now able to predict consumers’ shopping preferences by analyzing previous spending and targeting them with mobile discounts and offers based on their proximity to retailers affiliated with the bank. Payment transactions, including discounts, can now be completed over a mobile phone at the point of sale. The Starbucks mobile app is an example; however, this is just the beginning. Soon, computers will be conducting commerce with other machines. Smart vending machines will be able to monitor their inventories and order new stock as needed. Roof sensors will be able to schedule a repair crew upon detecting a leak.

Currency itself will soon go digital. Bitcoin today might be an initial experiment, but government-issued digital currency with legal tender value is bound to appear soon.

Future of Banking in the Connected World Retail banking will continue to be transformed. The economics of the branch banking model are already very strained given low interest margins and decreasing branch traffic, a trend that is bound to accelerate. A new study shows that millennials (those born between 1982 and 1996) would be more comfortable banking with Google and Facebook than with a traditional bank. In this new reality, retail banks have no other alternative but to fully transform their sales and service model by mixing video conferencing with mobile applications, social interactions and physical presence. (“Winning Strategies for Omnichannel Banking, Cisco IBSG Global Research Reveals New Ways for Banks to Prosper in an Omnichannel World,” by Jörgen Ericsson, Philip Farah, Alain Vermeiren, and Lauren Buckalew, www.cisco.com/ web/about/ac79/docs/Cisco-IBSG-Omnichannel-Study.pdf ) For Mexico, the opportunities are significant: the country is due for a new wave of accelerated growth starting in 2014, there is a strengthening middle class and a sizeable young population ready for new banking models, and the rapidly growing rate of usage of new technologies such as smart phones. Despite these changes and growth, banking practices and banking innovation in Mexico generally trail that of their neighbors to the south in Brazil, and to the north in the United States.

33.3

2012

additional services to the drivers of the next generation of connected cars?

2016

% change

Note: individuals of any age who own at least one smartphone and use the smartphone(s) at least once per month.

Source: eMarketer, Dec 2013

2017

The opportunity to foster innovation in the banking sector through policy, investment incentives and innovation-friendly regulations will have a major impact on creating sustainable economic growth and improved economic inclusion—or in slowing down the favorable trends.

PHILIP FARAH / MANAGING DIRECTOR, GLOBAL FINANCIAL SERVICES PRACTICE, CISCO CONSULTING SERVICES

www.fastcompany.com/3027197/fast-feed/sorry-banks-millennials-hate-you

The Future Is Here—and It’s Not Science Fiction da Vinci® Surgical System changes the world of surgery

Small Incisions, Big Advantages The da Vinci® Surgical System is a sophisticated robotic platform designed to expand the surgeon’s capabilities and offer a state-of-the-art, minimally invasive option for major surgery.

The da Vinci system can be used for gynecologic, urologic, cardiac, thoracic, general surgeries, colon and rectal surgery. Surgery with the da Vinci system requires just a few small incisions, which can mean: • Faster recovery time.

• Less pain and bleeding.

• Less risk of infection.

• Shorter hospital stays.

• Smaller scars.

How It Works Although it is often called a “robot,” the da Vinci System cannot move or operate on its own; your surgeon is one hundred percent in control. With robotic-assisted surgery, the robot assists, but the surgeon is in control. For example, the robot helps during laparoscopic surgeries involving special instruments that are inserted through several small incisions in the body. During the procedure, the surgeon’s hand movements are translated through the computer to the robot’s arms that then do the work. One of the robot’s arms holds a special camera that provides 3-D views and magnifies the area where the surgeon is working.

Surgeons using the da Vinci surgical system report that the robotic instruments move more freely than the human wrist does, enabling them to get the instruments placed at the correct angle. Additionally, the robot can hold instruments without any of the fine motor movement that a human’s hands would have, making the surgery more precise.

The robotic arms can bend and rotate

more freely than a human wrist allowing them to access areas of the body that are harder to reach through traditional open and laparoscopic surgery.

Safety mechanisms are in place to ensure that the robot only moves under control of the surgeon. If the surgeon looks away from the computer terminal, the robot locks in place.

Am I a Candidate?

You should discuss the options for any surgical procedure with your doctor. He or she can help you decide whether a robotic-assisted procedure is appropriate for your health and condition. You also should discuss the risks and benefits of any procedure before making a decision. Any surgical procedure has risks, including reactions to medications, difficulty breathing, bleeding and infection.

For more information about Robotic Surgery using the Da Vinci Surgical System visit www.hnmc.com. da Vinci® Surgical System is a registered trademark of Intuitive Surgical, Inc.

TECHNOLOGY TRENDS / TENDENCIAS TECNOLÓGICAS

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obots assisting in surgery may sound like science fiction, but it’s not. With the da Vinci® Surgical System, now used by some hospitals in roboticassisted surgeries, surgeons can operate with enhanced vision, precision and dexterity while maintaining one hundred percent control.

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Promoting the Cross-Border

Energy MarketBorder

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ADVERTORIAL / PUBLIREPORTAJE

he proliferation of shale gas extraction operations (i.e., hydraulic fracturing or “fracking”) in North America has dramatically changed the global energy landscape as reflected by the U.S. and Canada’s global command in shale gas production. According to the U.S. Energy Information Administration (EIA), the U.S. and Canada were two of the three world’s leading shale gas producers with 39 and 15 percent respectively of the total natural gas production in 2012.

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Economists believe that hydraulic fracturing technologies could have a similar impact on Mexico. The EIA estimates that Mexico has the world’s sixth largest shale gas reserves with much of the potential believed to be an extension of the Eagle Ford formation in Texas. According to estimates by economist Thomas Tunstall of the UTSA Institute for Economic Development, the portion of the Eagle Ford in Mexico could contain as much as ten percent of the world’s recoverable shale oil reserves; the impact on Mexico’s economy could be similar to what has been seen in Texas (e.g., $61 billion in economic

development, 116,000 new jobs, and more than $2 billion in government revenue).

Consequently, many industry experts believe that Texas is poised to be at the center of the next international energy wave given its experience, expertise, and geographic proximity to the continued expansion of the Eagle Ford formation.

As Mexico enters a new era of energy reform with an increased emphasis on shale exploration and development, it is critical for mid-size energy companies to appropriately assess the opportunities and risks involved in cross-border development: • Is your enterprise positioned to compete in Mexico’s new open market?

• What is your company doing now to prepare for Mexico’s forthcoming bid rounds?

• How is your organization assessing regulatory, environmental, litigation and compliance risks unique to cross-border joint development energy projects?

• What challenges must be overcome to capitalize on unconventional energy resources, greater electric integration, and cross‐border renewable energy markets?

How your company identifies and addresses these issues may be the difference between a successful venture and one that could potentially derail a project. If your mid-sized energy company initiates or participates in crossborder joint development projects, we ask that you consider letting us share our unique perspective with you on the complex environmental, compliance, litigation, and regulatory issues you may be facing. At Jackson Gilmour & Dobbs, PC we help our clients understand, plan for, and successfully navigate these legal hurdles. If you are interested in learning more about how we can help you please

contact Victor L. Cardenas Jr. Victor L. Cardenas Jr. is a shareholder at Jackson Gilmour & Dobbs, PC (“JGD”) leading the firm’s cross-border energy practice, with an emphasis on midsize energy, commercial, and transportation sector clients. He represents companies of all sizes in complex environmental, regulatory, and commercial matters, including oil and gas contract disputes, gas supply, storage and transportation contracts, gas gathering agreements, property contamination cases, environmental cost recovery actions and superfund litigation. He also counsels clients on how to manage their environmental risks and claims through appropriate environmental indemnity clauses, performing appropriate environmental due diligence, ensuring regulatory compliance and developing other preventative and proactive strategies.

JGD has also assisted producers, transporters, and gas storage development projects with the determination of applicable federal and state permit programs and the securing of required approvals, including permits for construction and operation of new air sources, wetlands and water quality certifications, and pipeline construction authorizations.

Cardenas’ unique understanding of the political, environmental, transactional and regulatory issues unique to cross-border ventures is particularly valuable to U.S. and foreign energysector clients looking to expand their markets. He is fluent in Spanish and also has extensive experience with matters involving international crossborder e-discovery disputes.

Contact Victor Cardenas at vcardenas@jgdpc.com or (713) 355-5007.

tax treaties entered into by Mexico.

For example, in the case of U.S. shareholders of Mexican entities, the tax may be reduced to five percent or eliminated depending on circumstances.

• $1 peso per liter on importation or sale of sugared beverages.

• Eight percent on importation or sale of some high calorie food (snacks, candy, chocolate, ice cream etc.).

• Gas, fuel and coal are taxed based on a table.

• Pesticides taxed based on toxicity.

• Increase of the highest marginal rate for individuals to 35 percent.

Corporate rate stays at 30 percent.

• VAT rate is adjusted to 16 percent in the border areas.

International tax provisions

Mexico 2014 Social and

Tax Reform

By Mauricio Monroy, Tax Partner, Ibáñez Soltero Gómez Paz y Monroy, S.C.

ADVERTORIAL / PUBLIREPORTAJE

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sweeping tax reform in Mexico became effective January 1, 2014. The reform includes a wide range of provisions that require a thorough evaluation of their impacts on a case by case basis.

The reform includes adjustments to tax rates, sophisticated international tax rules, adjustment to taxation principles, administrative conveniences, etc.

income tax law that voids all precedents established under the old law. Other changes included in other sections of the legislation are the Federal Fiscal Code, the Value-Added Tax Law, the Law on the Special Tax on Production and Services (excise taxes), and the Federal Dues Law.

This is indeed a very peculiar reform that triggers mixed feelings. On the one hand, the Business Flat Tax (IETU) and Cash Deposits Tax (IDE) were repealed, but the new provisions demand more administrative burden to ensure proper compliance.

Adjustment to tax rates and computation of tax bases for corporate entities

Among the many provisions of the bill are mechanisms to use taxes as a means to protect the environment, promote a healthier population and create more social support programs. These are reflected in the name of the tax bill: Social and Tax Reform.

One of the most important aspects of the reform is the enactment of a new

The significant provisions affecting corporate entities (unless otherwise stated) can be grouped as follows:

A number of provisions revise tax rates, create new taxes and revise the method of computing taxes for income tax purposes.

The most important are summarized as follows: • Limits on deduction of employee benefits, depreciation on automobiles and meals.

• New taxes on mining operations: 7.5 percent on taxable income (similar base as income tax) and half a percent tax on mining of gold, silver and platinum • Ten percent dividend tax. This tax is either reduced or eliminated based on

Beginning in the early nineties, Mexico entered into tax treaties to prevent double taxation and avoid tax evasion. Along with such treaties, many tax provisions governing cross-border transactions have been included in the domestic tax legislation. Such provisions, along with the wide network of existing treaties, make today’s Mexico tax system one of the most sophisticated in the developing world.

The 2014 reform also incorporates new provisions that govern international transactions. Here are the most relevant: • Additional requirements to qualify for tax treaty benefits.

• Adoption of additional anti-tax haven legislation, in particular, limiting the deduction of payments of interest, royalties and technical assistance to foreign transparent entities for tax purposes. Also, limitation on the deduction of payments that are not taxable by the recipient of the payment, or payments that create double deductions.

• Increase to 35 percent on the gain from the sale of real estate or shares of Mexican companies. Some tax treaties grant a tax exemption on capital gains from the sale of shares of Mexican companies under certain conditions.

Internet-based enforcement Over the past decade, Mexico has been working toward implementing

A new order for tax incentives The Mexican tax system has traditionally included tax incentives, benefits and administrative conveniences for several industries and situations. In the 2014 reform, some of those incentives were amended as follows: • Replacement of the tax consolidation system with a similar system with less deferral benefits.

• Elimination of real estate investment corporations (SIBRAS).

• Elimination of immediate deduction of land for developers.

• Program for “incorporation” of new taxpayers (individuals).

• New rules for primary sectors (agribusiness, etc.)

• The tax certification (dictamen fiscal) formerly mandated by law for larger taxpayers as defined in the law, now becomes voluntary and only for even larger taxpayers.

• As discussed above, the IETU was eliminated. This elimination is indeed an important incentive in light of its cumbersome compliance.

Maquiladoras Taxation of maquiladoras is probably one of the most dynamic special taxation systems intended for a specific industry. At a given time, there were isolated references to the industry in tax legislation. Today, it receives some of the most refined provisions of the Mexican tax system. In fact, although the administrative burden of compliance with the 2014 reform is heavy, the tax burden for the industry is not much different than it has been for almost 20 years.

A summary of the relevant 2014 amendments to the taxation of maquiladoras is as follows: • Compliance with a new definition of maquila operations for tax purposes is required to secure protection of the parent company from permanent establishment (PE) exposure in Mexico. Conditions to avoid PE include: - Compliance with a safe harbor transfer pricing provision (see description below) or secure an Advanced Pricing Agreement (APA) – transfer pricing ruling.

- One hundred percent of components imported on a temporary basis should be exported (physically or “virtually” as defined in the law, exception for scrap).

Sales into Mexico are accordingly disallowed.

- At least 30 percent of machinery and equipment should be owned by the foreign principal.

- Safe harbor is same as in the old law—minimum taxable profit to be the higher of: a) 6.9 percent of assets including foreign-owned assets. b) 6.5 percent of maquiladora costs and expenses including adjustments for certain foreign costs.

- Two other two special transfer pricing provisions for maquiladoras available through December 31, 2013 were repealed.

• Partial exemption of income tax for maquiladoras is eliminated as of January 1, 2014.

• “Shelter programs” (non-related foreign customers having a maquiladora contract directly with a Mexican

shelter operator) become limited to four years. After four years, foreign customers of a shelter must abandon the program. This provision does not apply to shelter programs where the shelter agreement is entered into by a foreign-based shelter operator and a foreign-based client.

• Value-added tax - Taxation of maquiladoras in 2014 remains exactly the same as in prior years.

- Under a general rule, temporary importation of goods by maquiladoras and similar programs becomes taxable as of January 1, 2015.

However, a one hundred percent credit will be granted to “certified” maquiladoras (see definition below), which neutralizes the new rule.

- VAT certification: • Applications should be filed between April and October 2014 depending upon the domicile of the maquiladora.

• Besides the VAT credit, depending upon the category of the maquiladora as established in the law, additional administrative benefits may be secured This summary provides an overview of the scope of the 2014 tax reform in Mexico that requires thorough analysis to secure proper compliance. The complexity of some of these rules will require clarification, so taxpayers should pay attention to the publication of public letter rulings, amendments and enactment of the regulations of the new income tax law.

For more information contact: Mauricio Monroy mmonroy@mmc-mx.com Guilllermo Gómez ggomez@mmc-mx.com Tel. + 52 (664) 972-9072 Office in Mexico: Av. Ejército Nacional 843-B, Col. Granada, Piso 5, Edificio Antara Delegación Miguel Hidalgo México, D.F. 11520

www.mmc-mx.com

ADVERTORIAL / PUBLIREPORTAJE

a paperless tax compliance system through electronic filings, invoicing, etc. This year, a number of significant steps were made to create a “cyber-tax ecosystem.” Provisions include: • All taxpayers will have a tax mailbox with SAT (Tax Administration Service) to receive communications, inquiries, to request rulings from SAT, contest assessments, file notices, etc. They will have 72 hours to open incoming messages. This provision becomes effective as of June 30 for corporate taxpayers and 2015 for individuals.

• Accounting must be electronically processed. These provisions will be phased-in by regions to be disclosed.

• Expanded requirements are established for digital (electronic) documentation including payroll stubs. Currently invoices electronically produced through the SAT portal are required.

• Monthly accounting reports should be electronically reported. This will also be phased-in by region.

• Powers are granted to the tax authorities to perform “electronic reviews.” Scope and definition are still to be clarified.

11

Energy Reform Is for

Entrepreneurs

ADVERTORIAL / PUBLIREPORTAJE

By Carlos Campos Echeverria

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E

nergy reform has changed the industry’s landscape in Mexico and it is important that Mexican businesses working in that sector study those reforms to understand the business opportunities they offer. Entrepreneurs can discover the many benefits that are waiting to be exploited and can support the country by taking advantage of the changes that reform brings.

Is it risky? Of course—no business venture is guaranteed—but there are many ways to minimize the risks. For

example, studying and understanding the law completely and how it will govern the production and marketing of oil so that the entrepreneur can know how the reforms match the profile and experience of the company.

Based on the above, form your own opinion about the changes that will occur as a result of the energy reform and adjust the business plan to be able to take optimal advantage of the opportunities.

Successful entrepreneurs are prepared to win and a key to that success is working with professionals and experts in the field to help hone the business plan.

Next, evaluate whether an alliance with other professionals will strengthen your business. Ensure any collaborations are legally solid and commercially attractive.

What do you need to know about energy reform?

• The principles of the legislation.

Know the goal of the reform and the expected results as well as understanding changes will need to be made to conform to the new laws.

• The fiscal outlook. Recognize how energy reform and entry information from foreign oil companies can affect the country’s fiscal outlook and analyze changes that will affect your business.

• New forms of competition. This is one of the most important aspects to consider: how will your company and its brand compete with and how can you stay ahead of the other bidders. Apply understanding of the procurement process by building a thorough knowledge of the products or services you can offer.

• Foreign companies interested in Mexican oil. Mexican companies can meet the needs of many foreign companies operating in Mexico as they provide opportunities for partnerships for your services or products. Examine its profile, activities and staff; there may be a business that can lead you to success.

• The position of the major players in the energy industry. You need to know the viewpoints of those involved in the direction and development of the energy industry of the country and the world as a way to anticipate changes that may affect your business.

New opportunities in the energy industry arise daily for entrepreneurs and businesses that are prepared to take advantage of them.

Energy reform is a controversial and definitive issue for the development of Mexico, so it is important to not only become educated about the laws but to leave behind the questions of its viability. The reform is already running, so you have to look ahead and prepare wisely.

Carlos Campos Echeverria is a specialist in the oil industry, supported under the principle of High Level Zero Corruption. He graduated from Escuela Libre de Derecho. He can be reached at: Carloscamposecheverria@ bclegalconsulting.com.mx. www.bclegalconsulting.com.mx.

Advantages of

Financing in the Stock Market

Standard organized markets are a free, efficient, competitive, transparent financial channel under regulation in agreement by the market participants involved.

The Mexican Stock Exchange (Bolsa Mexicana de Valores) founded in 1894, operates under the concession by the Ministry of Treasury (Secretaría de Hacienda y Crédito Público), and oversight by the Securities Market Law. Through investment, it has contributed to Mexico´s economic growth and several benefits have been generated for the country.

A company can be financed through debt or capital markets issuance; the Mexican securities market offers a variety of financial instruments with equal opportunities for all investors: • Capital Markets: Stocks, Equity Shares trade and FIBRAS (REITS).

• CKD’es: Funding for private equity, real state, infrastructure, energy.

• Debt: short-, mid- and long-term liquidity for government* and private sector, several debt instruments** It is essential that issuer companies publish price-sensitive information on a timely basis in accordance with the listing rules. Timely publication of information to stockholders and investors provides reliability.

Financing allows companies to continue improvement and expansion projects, an

accomplishment for potential growth, accompanied by all the benefits to enhance business. Offering stock shares and securities makes a company more competitive and leads to a series of advantages for the investors, shareholders, clients and suppliers, among them: • Institutionalization. Establishing corporate governance, adopting International Accounting Regulations and to manage standard processes, fosters institutionalization, maintaining control once debt or capital issuance, easing the succession process.

• Promotes competitiveness.

Corporate growth and expansion.

• Effectiveness in administrative management. Promotes a better administration, the disclosure of information, the transparency and efficient management within an ethical framework are practices that ensure the permanence of the organization.

• Increases corporate value. Stocks, equity, debt, CKDs (development and capital trusts), FIBRAS (infrastructure and real estate trusts), among other instruments, generate value for shareholders, suppliers and clients. Through institutional management the company turns attractive for domestic and foreign investors.

• Strengthens financial structure.

Results in a solid strategy to increase net income, reduce costs, increase profit margins, immediate cash flow, innovation, liabilities consolidation, funding for research and development, sustainability and human resources.

• Financial corporate recognition and quality standards. Stock financing grants the level of maturity of the company, improving corporate governance decision-making consistent with the company´s strategy and reflects the efficiency of its leadership. Therefore, it features a new intangible asset, wide open possibilities for greater financial resources in better terms and conditions.

• Flexibility on corporate finances and capital sources. The original shareholders are able to diversify their investment as well as its risk, increase liquidity and gain flexibility on the decision-making on their assets.

• Worldwide image, projection and brand positionin. Listing in the Mexican Stock Market is a powerful tool to endorse the competitivenessstrengthening strategies of an organization; reinforces its image as a professional and public corporation; facilitates strategic alliances, mergers and acquisitions; and enables action programs for key employees.

Companies gain access to global markets, build credibility with foreign and international investors and clients, standardize processes and earn brand positioning for their products and services.

Subdirection of communications BMV Group

The Mexican Stock Exchange invites entrepreneurs to get acquainted with all the advantages of financing through the stock market, thus contributing to investment and the economic growth of Mexico, through productive projects. *Government Instruments: CETES (Federal Treasury Certificates), Udibonos, Development Bonds, Indemnity Note and BPAS Bonds. **Debt Instruments: Short-Term: Bank Acceptances, Commercial Paper, Note with Interest Payable at Maturity, Short-Term Stock Certificate; Mid-Term: Mid-Term Note; Long-Term: Liabilities, Real Estate Participation Certificates, Ordinary Participation Certificates, Stock Certificate and Note with Interest Payable at Maturity at a Term over one year.

OF INTEREST / DE INTERÉS

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tock exchanges around the world are private institutions, a resource for investors, an option to increase earnings while financing projects for companies and government institutions supporting growth, development and employment.

13

Effective Leadership in Binational,

Bicultural Teams

B

uilding and leading cohesive teams in multicultural environments provides a competitive advantage for effective business operations and, recently, has become a necessity with today’s rapidly changing business landscape. This is especially true in the Mexico-U.S. relationship in the oil and gas industry.

The recent energy reform in Mexico motivates companies from several countries to look for investment opportunities in the Mexican oil and gas industry. Doing business with individuals from many diverse countries has become commonplace in the industry’s operations, strategic direction and technology development.

The information that follows is intended to share some best practices that have help me make these partnerships more effective—especially those with teams comprised of people from both U.S. and Mexico businesses.

Deep Understanding of Timelines

OF INTEREST / DE INTERÉS

I remember sitting at an industry conference in Houston in 2006 when an analyst took to the podium and assured the attendees who were primarily local oil and gas executives that the Mexican reform efforts had finally passed a major milestone and Mexico’s oil would be available to all in a matter of weeks.

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In my experience with project risk evaluation, the most common factor business people often underestimate is timing. It is important to be conservative in assessing timelines and determining how firm each milestone can actually be—especially when it comes to new processes. Leaders must manage timing accurately and assess each

culture’s interpretation of timing on key benchmarks within his or her binational team to ensure good decisions are made.

express his or her opinion so all feel valued within the group.

Context and Scale

From a leadership perspective, it is important to recognize that oil and gas projects will have very different timelines for each side of the Rio Grande and how those timelines will be affected given the current boom state in oil-rich reservoir exploration north of the border, new legislation, budget finalization and asset assignment south of the border.

Formality of Processes Within Different Business Types For the last 20 years, NAFTA has brought the U.S. and Mexico closer commercially in industries other than oil and gas exploration and production.

Pemex’s very formal requirements will affect operations for the private sector in both countries, necessitating strong leadership to make appropriate adjustments in the project’s structure, documentation, task assignment and reporting, to comply with those requirements.

Trust Teams formed to carry out business in the oil and gas industry in a binational environment, i.e. the U.S. and Mexico, will most likely include members who are new to each other or new to the group and culture, especially for those tasked with exploration and production activities.

Leaders must foster a business environment of transparency and encourage members to seek support from the team in order to build trust and communication. Leaders must be fair, treat each member equally with respect, and must motivate each member to

One other element that pervades projects with binational supervision is the perception of scale of operations.

Projections are that the U.S. will produce around seven MMBOPD (million barrels of oil per day) in 2014 and will drill around 45,000 wells during the year.

Mexico, in turn, will produce slightly more that two MMBOPD, drilling around 500 wells, with a single oil and gas company as a resource holder.

An immediate effect of the energy reform is that private companies will be able, under certain conditions, to execute large projects that will help raise Mexico’s production levels. In this transition period, there is no continuity index-wise when it comes to development between the two countries. Extrapolate the above statistics to the number of wells by basin, barrels produced by average well, or transport and refining capacity by field and the indicators are completely different. Leaders must motivate their staffs to consider the issues and capacity of the two markets separately.

These observations on the critical importance of integrating good leadership into the structure, systems and processes, culture and human resources in this new binational exploration and production environment result from my personal and direct experiences. Whether a company is looking to expand to the north or south of the U.S.-Mexico border, focusing on developing good leadership skills can make the difference in developing successful teams, thus, a successful project result.

Maximo Hernandez is the CEO of VES Survey International, the world’s leading independent wellbore surveyor for the oil and gas industry. For more information about the company, visit www. vessurvey.com.

NORTH AMERICAN SUSTAINABLE ECONOMIC DEVELOPMENT SUMMIT Energy, Infrastructure, Transportation and Logistics August 25-26, 2014 Four Seasons Hotel & Resort Las Colinas-Irving, TX

For more information, please visit our website www.usmcoc.org 15

PRESIDENCIA DE LA REPÚBLICA

Summit Brings Together

North America Leaders

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OF INTEREST / DE INTERÉS

n February 19, 2014, Mexico President Enrique Peña Nieto, U.S. President Barak Obama and Canadian Prime Minister Stephen Harper met for a oneday summit in Toluca, Mexico. Following the conclusion of the summit, the leaders held a press conference to discuss the results of their talks and reaffirm their commitment to collaboration and cooperation as they observed the twentieth anniversary of the North America Free Trade Agreement (NAFTA).

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President Enrique Peña Nieto: President Peña Nieto welcomed Mr. Obama to Mexico for his fifth official trip—the country he has visited the most during his presidential term. The purpose of the visit was to follow up on the agenda established in previous visits which included economic and commercial agreements; and designing mechanisms for construction and financing of strategic projects, including evaluating methods to make commercial exchanges between the two countries more agile and safer.

Another discussion issue was increasing the number of Mexican students studying in the U.S. from 14,000 to 100,000, and the U.S. students studying in Mexico to 50,000. Security continues to be an area of cooperation and coordination to confront this very common theme in the border area between our two countries.

Peña Nieto outlined the agreements reached during the summit which fall into four main categories: 1. Encouraging mutual and inclusive prosperity. a. Agreement on a work plan for competitiveness. b. Development of a transportation plan for North America to ensure a better infrastructure in the three countries to encourage commerce in the three countries. c. Facilitating transportation of people among the nations through trusted traveler programs.

2. Identifying and evaluating areas of opportunity. a. Expand agreements to a tri-lateral

scope, specifically in the education of professionals, increasing academic exchange and its required mobility among the countries. b. Agreement to support sustainable development especially in mitigating climate change.

3. Citizens’ security and other regional themes. a. Prioritize information exchange among the countries. b. Reinforce measures to counter money laundering. c. Support growth in the Caribbean 4. Re-commit to continue tri-lateral meetings.

In light of the 20th anniversary of NAFTA, Peña Nieto added that he believes this is the most competitive region in the world.

President Barak Obama: President Obama stated that Canada and Mexico are two of the United States’ biggest trading partners, creating millions of American jobs. Exports from

the U.S. to Canada and Mexico continue to grow faster than in the rest of the world which gives North America a tremendous competitive advantage.

He then detailed efforts to create more jobs in Canada, Mexico and the U.S.

The U.S. will continue to work on the Trans-Pacific Partnership including strong protections for workers and the environment making the U.S. more attractive to investment. He reiterated that immigration reform continues to be one of his highest priorities reflecting Peña Nieto’s goal of having more students from the United States studying throughout the hemisphere, and wanting more students from places like Mexico and Canada studying in the United States.

• Second, the countries continue to deepen clean energy partnerships and agreed to join with Central American and Caribbean partners on a regional energy strategy.

• Third, realizing the full potential of the individual countries and the region means confronting the criminals whole narco-traffickers who have unleashed so much violence on our

PRESIDENCIA DE LA REPÚBLICA

• First, we are focused on making it easier to trade, noting that he signed an executive order to make it easier for companies that want to export and import. The U.S. will continue investing in infrastructure and will step up efforts to streamline and eliminate regulations and red tape that can sometimes stifle trade and job creation. citizens. In Mexico, the security forces and the Mexican people continue to make enormous sacrifices in that fight, and the United States joins with them against this threat. The U.S. continues to be committed to reducing the demand for illegal drugs and will persist with unprecedented efforts to combat the southbound flow of illegal guns and cash.

• And, finally, given the shared commitment to democratic values and human rights, Obama commented on the situations in Venezuela and Ukraine, and the unacceptable violence in those two countries, which the United States strongly condemns.

Obama closed his remarks by thanking President Peña Nieto and the people of Mexico, and the people of Toluca in particular, for their wonderful hospitality. He reassured everyone that, if they stay focused on the shared

vision—a North America that’s more integrated and more competitive—then progress in each of their countries will mean more prosperity and opportunity for everyone.

Prime Minister Harper: Prime Minister Harper commented on the twentieth anniversary of NAFTA, noting that the volume of exchanges is fourfold now, and is over $30 billion. He agreed that the three countries can still grow the success of NAFTA. Harper described some of the topics the leaders examined and discussed, especially the state of the world economy at local and regional levels, and North America’s competitiveness.

He also noted the leaders’ enthusiasm to collaborate with each other. He said they will continue to work together and take advantage of all the opportunities that will contribute to the well-being of their respective populations.

He remarked that he and the presidents will continue to work together to address the challenges of the 21st century and to seize the many promising opportunities that the future holds for the people of the region. In closing, he stated, “I do look forward to hosting the next North American Leaders Summit in Canada.”

OF INTEREST / DE INTERÉS

PRESIDENCIA DE LA REPÚBLICA

In summary, the prime minister expressed his appreciation for productive meetings with Canada’s closest friends and trading partners; partners with whom they share goods, services and information, as well as fundamental values and a vision for a democratic and peaceful world.

Cecilia Lopez Source: Presidencia de la Republica

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NE/New York and California/LA Chapters Sign Letter of Intention for

Tourism Initiative with Mexico City

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he Northeast/New York and California/Los Angeles Chapters of the United States-Mexico Chamber of Commerce, represented by their executive directors, Alejandro Ramos and Marlen Marroquin, signed a Letter of Intention with the government of Mexico City to work on an initiative intended to offer special tourism packages and benefits to members of the Chamber when visiting Mexico City. Mexico City was represented by Mayor Angel Mancera and Miguel Torruco, Secretary of Tourism of Mexico City,

This initiative is an integral part of the Mis Raíces (My Origins) program that Mexico City is developing with the support of the Chamber to promote Mexico City as a premiere tourism destination within the Mexican-American community and Americans with special ties to Mexico City.

The U.S.-Mexico Chamber of Commerce was selected as a

partner for this project due to its membership that includes many Mexican nationals and professionals of Mexican origin, as well as many others affiliated with the Chamber through the companies they represent and as individual members.

Mis Raíces will open new alternatives for our members to enjoy the historic, cultural, architectural and gastronomic wealth of Mexico City and, at the same time, the program will provide opportunities for those members living in the U.S. who have origins in Mexico City, to share their heritage through the tourism of the city.

While Mis Raíces will strengthen relations between Mexico City and the United States by means of tourism, it is also a way to promote business and investment between both countries, a basic element of the mission of the United States-Mexico Chamber of Commerce.

OF INTEREST / DE INTERÉS

From left to right: Marlen Marroquin, USMCOC California Chapter; Alejandro Ramos, USMCOC Northeast Chapter; Miguel Torruco, Secretary of Tourism of Mexico City; Miguel A. Mancera, Mayor of Mexico City; Manuel Granados, ALDF; Alfonso Lebrija, Aeromexico.

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From left to right:; Alejandro Ramos, USMCOC Northeast Chapter; Miguel A. Mancera, Mayor of Mexico City; Marlen Marroquin, USMCOC California Chapter; and Miguel Torruco, Secretary of Tourism of Mexico City.

Alejandro Ramos, Executive Director, U.S.-Mexico Chamber of Commerce Northeast Chapter.

Miguel A. Mancera, Mayor of Mexico City.

good neighbor inspiracional awars

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Good

Neighbor

Inspirational Award The United States-Mexico Chamber of Commerce is pleased to announce the inauguration of the Good Neighbor Inspirational Award which will be presented during the annual Good Neighbor Awards Gala scheduled for May 15, 2014, at the palatial Organization of American States (OAS) headquarters in Washington, D.C.

THE COVER / ARTĂ?CULO DE PORTADA

THE FACTORY AGENCY

Mallory Weggemann American Paralympic swimmer

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his award will be presented for the first time to Mallory Weggemann, American Paralympic swimmer, and Arly Velรกsquez, Mexican Paralympic Alpine skier.

These two honorees, both accomplished athletes at early ages who were paralyzed while they were still teenagers, have demonstrated remarkable courage, strength and perseverance to overcome

the limits of their disabilities. They Mallory and Arly share their amazing inspire us to pursue our goals with stories on the following pages. They describe their lives before and after energy and persistence. becoming paralyzed and how, through Through this award, the USMCOC and their determination, laser focus and inner its sister organization, the U.S.-Mexico strength, they were able to rise to the top Cultural and Educational Foundation, of their individual sports. They also share applaud these athletes and hope their with readers their most important lessons stories encourage young people in and personal strengths. both countries to face their challenges without fear, to believe in themselves, The USMCOC is proud to honor these remarkable people. and to follow their dreams.

THE COVER / ARTร CULO DE PORTADA

ALENA IVANOVA

Arly Velรกsquez Mexican Paralympic Alpine skier

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Not Allowing Tragedy to

1. Let the past be the past, cherish 1 the memories, learn from the adversities, but in no way live in it. Move toward the future and allow yourself to simply let go.

Define Your Future

By Mallory Weggemann

January 21, 2008, is a day that I will never forget. I was just two months shy of my 19th birthday when I walked into a medical clinic and never walked out.

That day I was supposed to receive a routine epidural injection to help treat back pain, but, instead of walking out a few hours later, I was wheeled out nearly six weeks later.

THE COVER / ARTÍCULO DE PORTADA

I entered a new world the minute I became a paraplegic, as I was now a member of the disabled community.

From that moment forward, it felt as though the world saw me differently; it felt as though the world looked at me as broken, incapable and helpless simply because I could no longer use my legs.

I had a hard time understanding what this meant for my life moving forward; the uncertainty of my future was one of the hardest obstacles I had to overcome.

Although, with time, I slowly realized that it isn’t the circumstances in life that define us, it is how we react to them that makes us who we are.

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Nearly four months after my paralysis I made the decision to return to the pool.

I had been a competitive swimmer since the age of seven but after my paralysis, I thought I would never have that part of my life back. I strongly believe that my swimming saved me in the most literal way possible. It brought me back to life and allowed me to be excited about the promise of tomorrow, rather than afraid of the uncertainties my future held.

When I was first paralyzed, I believed I was now defined by those four wheels of my wheelchair, and, although it is a part of me, it is simply just that: a part of me. My wheelchair in no way defines me—it simply helps me move around.

Since my paralysis in 2008, I have found my meaning IN life; I have found love in myself, in things that I

am passionate about, and in another. I have dreamed, achieved those dreams, had triumphs and tragedies—all part of the journey.

In 2009, I set my sights on the ultimate goal: Paralympic Gold. Now that I was back in the pool and competing, I wanted nothing more than to represent the United States of America at the 2012 Paralympic Games, and yes, win Paralympic Gold. At that time I had only been paralyzed for a little over a year, but that didn’t matter to me, something within me felt that anything was possible.

On September 2, 2012, my dream came true. I sat on the podium and watched the flag being raised as they played the national anthem in my honor. I had just become a paralympic gold medalist and everything I dreamed of became a reality. In that moment, I realized that our dreams are not made up of just a single moment, but also about the journey to get there which is what makes the accomplishment all the more important.

Paralympic gold was my dream, in fact I thought it was my ultimate dream.

However, en route to achieving that dream, I realized that it was the process of letting go and moving forward that was the most significant achievement.

As I sat on the podium, I had a moment of peace rush over me. The pain, heartbreak, anger, frustration and fear…were all gone. My journey to paralympic gold was also my path to finding myself, to letting go of fear and moving forward with life—and, that to me, is what success is all about.

I have learned so much about myself and life over these past six years.

Through my journey, I developed my “Ten Pointers to Find Success in Our Personal and Professional Lives”:

2. Don’t allow yourself to get so 2 caught up in the future that you lose sight of the present. Allow yourself to have dreams, goals and ambition, but don’t let them keep you from enjoying the here and now. The journey along the way is what makes the end goal so special, so enjoy it!

3. When you get overwhelmed, 3 remember: baby steps. Life is a series of baby steps. In the same way you cannot recite the alphabet without everything between A and Z, life is the same. Each baby step is a part of the journey so embrace them all.

44. Remember: in any situation, it isn’t the circumstances that define us; it is how we react to them that defines us.

5. No matter how hard life becomes, 5 remember that it can always be worse. Take the time you need to grieve, but then move forward and remember to be thankful for what you do have.

66. Love. Love yourself, find love in the things that you are passionate about, and love another. The accomplishments in life are gratifying but what do they mean if you don’t have anyone to share them with? Don’t allow life to wedge itself between you and your loved ones.

77. Believe in yourself and allow yourself to hold onto the innocence of your childhood. Remember that time that we all believed we could be anything and do everything? Don’t let life wear that away. Hold on to it and allow yourself to believe anything is possible.

88. Give back. As a citizen of the world, we each have a duty to give back to our communities. Good deeds not only benefit others, they also teach us about ourselves and life in general.

99. Allow yourself to continue to learn.

Whether it is a new hobby, a new skill at work, or simply learning something new about a loved one, always continue to learn more about yourself, the people around you and the world.

1. Most of all…live your life with 10 passion, heart, free of fear, hate and judgment. Be courageous, and know that in any given moment, you can make a difference and you can change the world.

THE FACTORY AGENCY

(Ed: Mallory Weggemann returned to the pool on April 8, 2008, less than three months after becoming a paraplegic. Since that time, she has set 16 world records and 33 American records.

Currently, she continues to train in pursuit of the 2016 Paralympic Games in Rio de Janeiro, Brazil, and is actively building a career outside of the pool through motivational speaking and other public appearances around the world.

Mallory will also be featured in “The Current,� a documentary produced by Make A Hero, a non-profit organization focused on inspiring individuals with disabilities to enjoy the freedom of adaptive sports. www. malloryweggemannusa.com)

23

Why Walk If

Juvenile National Championship at the age of 16. It was a great feeling for my family and me to be competing again in a sport, but it didn’t compare to zooming down a mountain.

You Can Fly?

By Arly Velásquez

Four years later, in Banff, Canada, I tried Alpine mono-skiing for the first time and my new life began where my old one left off: on the mountain, the place where I really know myself. I fell in love with the sport and ultimately moved to Park City, Utah, to develop my skills. There, I met Erik Bayindirli, also a Paralympic skier, who became my guru and taught me everything he had learned in his 30 years of mono-ski racing. (Ed: Mono-skiers sit on a single ski with crutch-like ski poles.)

During the 2012-13 season, my training paid off as I earned a bronze, then a silver medal. Following that, in a Super-G grand slalom race, I found just the right balance, connected with my ski and the mountain, and won my first NorAm Cup.

THE COVER / ARTÍCULO DE PORTADA

At the age of 13, I thought I knew it all.

I had already won a Juvenile National Championship in mountain biking against 19-year-olds and had visions of a professional career in the sport. As an independent and highly active kid, sometimes I didn’t stop for anything and miscalculated risks. I was the younger of two children, raised by Lilia, my mom.

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Life literally flipped me upside down on September 29, 2001. I had broken my bicycle on a 45-foot long ramp a week before and was attempting the stunt again on a borrowed bicycle. Being unfamiliar with the bike, I was unable to master the maneuver and landed on my head, damaging my T6 and T7 vertebrae. They were cracked but, fortunately, remained in place. The pain was excruciating—the worst pain I had ever experienced in my life. I felt like I was dying.

The paramedics arrived after about thirty minutes to check me out. They didn’t think I was seriously injured so they decided to have me sit. The cracked vertebrae couldn’t support me. They shifted and compressed my spinal cord. After a minute, I couldn’t feel my legs anymore.

Two surgeries later, I was lying on a bed trying to figure out how to feed myself.

Not fully conscious of what happened and still trying to understand this new situation where I was under the care of nurses and family. I needed to learn so many things all over again. Everyone was hoping for the best, especially my mom who didn’t stop looking for treatments and other options which could help me. I just followed her example and dedicated myself to physical rehab day after day.

I had recovered around thirty percent of my right leg movement, but months passed when I didn’t see any more improvement. Three years after my injury, I understood it was going to be a much longer process than what I imagined. I had to take a deep breath to put my life into perspective.

After some months of depression, I decided to start thinking about what I could do rather than what I couldn’t do.

I decided I wanted to return to sports.

I tried everything from swimming to basketball and then track where I found myself competing and winning the

Season 2013-14 was the Paralympic year. I finished my last races with good results winning a silver medal in the grand slalom. I also put in a very solid performance in the World Cup and placed 14th in the world ranking in downhill, the fastest event of Alpine skiing.

Sochi 2014 arrived and I was to compete in a downhill race. I began my run but, on the steepest part of the course, the edge of my ski caught and I began to flip.

Six spins later, when I finally came to a stop, I was in tremendous pain all over my body, especially my left shoulder.

It was the worst crash I ever had but, luckily, I had no broken bones. The very next day, I had my second chance in Super-G. I was not feeling good as I had not recovered from the previous day’s fall, but I was there to write history. In a big fight to the finish, I was in 11th place— the best showing a Latin American ever achieved.

Lots of things went wrong in Sochi but I learned from them. I came back to Park City for the last races of the season and in the U.S. National Championship, I had the second best time in two runs— just 45/100 of a second behind Heath Calhoun, a Paralympic silver medalist in Sochi. And in the NorAm Cup, I was able to break through and win the gold medal in the grand slalom, setting the best time.

This accomplishment required lots of

1 Dreaming made my life make sense again after being in a wheelchair for twelve years.

6 Tenacity to be able to overcome the noise in my head and get the job done.

The person who taught me how to dream big and work hard to achieve is my biggest hero, my mom. My other rock is my sister who gives me the strength to keep going.

2 Consciousness to be aware of myself, my surroundings and my actions.

7 Self evaluation to critically look at myself and my actions. I am my best judge and I can’t lie to myself.

3 Honesty with who I am and what I really want.

8 Change by identifying errors and mistakes and improving the next time.

I have learned so much about myself in the years since my accident. From the first days I began to understand my disability and its limitations, my lessons have often been hard-learned but well-earned. These ten lessons are my life’s compass:

4 Responsibility to know that if I don’t take the step, no one will do it for me.

5 Discipline to work everyday and give my best in every try.

9 Assume that I am the only person responsible for my actions.

10 Believe that, if I think something is possible, it is.

THE COVER / ARTÍCULO DE PORTADA

TAMARA GÓMEZ.

hard work but proved we are all able to make our dreams come true.

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March 10 Mexico’s Reforms: An Economic and Political Analysis In 2013, President Peña Nieto presented an unprecedented number of constitutional and structural reforms regarding key industry sectors including energy, telecommunications, antitrust, labor, banking and finance, which were subsequently approved by Congress.

Congress is currently discussing secondary regulations for some of the reforms while others are expected to be presented within the near future.

Presently, the most significant challenges are the pending discussions, approval and implementation of said reforms which would provide Mexico with unparalleled growth and development opportunities.

We had expert analysts group give us their individual opinions from both an independent economic and political perspective regarding the process and potential outcome these reforms may have on Mexico.

March 17 Latin America and U.S. Tax Update The USMCOCNE collaborated with WTAS LLC, an independent international tax firm, to produce a seminar on several issues regarding

Latin America & U.S. Tax update.

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The Road from the Approved Structural Reforms to their Secondary Regulation: An Economic & Political Analysis

Latin American and U.S. tax regulations.

Attendees received an update on taxes related to foreign activities of U.S. taxpayers: Foreign Bank and Financial Accounts (FBAR), Foreign Account Tax Compliance Act (FATCA), Offshore

Voluntary Disclosure Program (OVDP), Doing Business in Latin America/ Perspectives from Selected LatAm Countries, foreign investments in the U.S., pre-immigration tax planning, and Exit tax-Expatriation.

March 18, 19 Monterrey Investment Outreach The Chapter supported Peninsula Press in their event, Monterrey Investment Outreach 2014, which brought Mexican business leaders together from the country’s most competitive manufacturing center, Nuevo Leon, and its capital city, Monterrey.

Senior state and federal government representatives were among the guests.

The premier gathering, held in New York, focused on local projects and flagship companies attracting C-level executives from leading organizations within banking and finance, manufacturing, heavy industry, ICT, logistics, high tech incubation and infrastructure development. Speakers included Luis Tellez, CEO of the Mexican Stock Exchange.

March 20 Mexico-Massachusetts Innovation Economy Networking Cocktail Reception Members of the Chamber accompanied the government of Massachusetts on a trade mission to Mexico. The delegation from the 2014 Massachusetts Innovation Economy Trade Mission to Mexico was led by Governor Deval Patrick and included representatives of the life sciences, clean tech and digital technology industries who were in Mexico to identify business and collaborative opportunities.

During an evening cocktail reception, Governor Patrick and Zacatecas Governor Miguel Alonso Reyes jointly announced one of the largest solar photo-voltaic (PV) projects in Latin America: the ZacSol 1 project in Guadalupe, Zacatecas. The governors were joined by project owners VERTEX Ingenieros Consultores, Constructora e Inmobiliaria Zacatecana, and Grupo Domos, as well as Panel Claw and Solectria Renewables, two of the leading solar PV component suppliers from Massachusetts.

March 28 Reception for Dr. Agustín Carstens The Economic Club of New York hosted a breakfast program for Dr. Agustín Carstens, Governor of Mexico’s Central Bank, at the Grand Hyatt New York in Grand Central. The Economic Club generously invited members of the Chamber to attend.

Monterrey Investment Outreach

April 24 Corporate Restructuring and Bankruptcy Procedures As part of the recently approved financial reform in Mexico, important changes to the Mexican Law of Restructuring and Bankruptcy Procedures (Ley de Concursos Mercantiles) were enacted.

Prior to this reform, certain cases that resulted in successful restructurings also raised significant controversy and uncertainty. The changes to the Ley de Concursos Mercantiles were intended to provide more certainty and more efficient procedures to protect the interests of parties involved. The conference provided a forum for discussion of the reforms, how they might be applicable to current cases, and how certain challenges experienced in the past could be addressed under the new regulatory framework.

May 5 Cinco de Mayo Corporate Luncheon The Chamber hosted its annual celebration of this important day in Mexican history to celebrate our heritage and embrace our culture by enjoying Mexican music, cuisine and beverages at Vermilion. This year Chamber partnered with Riviera Nayarit and famed chef Betty Vazquez from Riviera Nayarit who prepared a

fantastic menu inspired by the region’s local flavors.

May 8 U.S.-Mexico Real Estate Investment Summit 2014 Join us for our annual U.S.-Mexico Real Estate Investment Summit 2014.

This year, we have joined forces with “Inmobiliare Magazine”, a highly regarded real estate publication.

Recognized specialists from Mexico and the U.S. will deliver comprehensive analyses of Mexico’s real estate market, the current situation, outlook and its relation to the United States. Participants will learn about business opportunities in commercial, industrial, tourism and residential real estate in Mexico that is available to international industry investors. The summit will also explain trends and innovation in investing and financing real estate in Mexico.

This event will provide a forum for prime networking opportunities with individuals currently participating or interested in the Mexican real estate market, including real estate specialists, institutional investors, bankers and developers from Mexico and the United States.

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California Regional Chapter.

Los Angeles, CA Trade Mission from Hong Kong to Tijuana The U.S.-Mexico Chamber of Commerce California Regional Chapter welcomed a trade delegation of more than 12 individuals from Hong Kong and Zhuhai to Tijuana, Baja California, on April 10, 2014. The purpose of the trip was to promote business opportunities and partnerships between Mexican national companies and Asia.

Among the distinguished guests were Consul General of Mexico in Hong Kong Ambassador Alicia Buenrostro, and Director General of Invest Hong Kong, Simon Galpin. Galpin represents PYMEs (pequeña y mediana empresa, i.e. small and medium companies), the agency responsible for attracting and facilitating direct foreign investment to Hong Kong.

Chapter chairman Mauricio Monroy and Marlen Marroquin, executive director, organized the itinerary and the trade mission as well as hosting a seminar on business opportunities between both nations and promotion of Mexican exports to the Chinese region.

Mayor of the City of Tijuana, Jorge Astiazaran Orci.

For the last two years, the Chapter has organized a trade mission to China that has been very successful; in fact, a representative of one of the companies traveling with the mission, Cervceria Tijuana, is now beginning to export products—a true success story for our 2013 trade mission.

The USMCOCCA organizes this event every year and brings around 15-20 companies interested in learning how to enter the Asian market.

Baja California is one of the Mexican states with great opportunities to promote industries specializing in products such as automotive, medical parts, electronics, aerospace, etc. This mega region has a lot to offer and, with the guidance and support of the California Regional Chapter of the United States-Mexico Chamber of Commerce, many of them will have numerous success stories to tell.

Trade Delegation team Hong Kong to Tijuana-Ensenada.

Marlen Marroquin

Mauricio Monroy, Chairman USMCOC, California Regional Chapter; Ambassador Alicia Buenrostro Massieu, Consul General of Mexico in Hong Kong; and Marlen Marroquin, Executive Regional Director USMCOC, California Regional Chapter.

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Mid-America Chapter.

Chicago, IL Mexico’s Fiscal and Legal Update: Chicago The Chapter started the year with its annual fiscal update by professionals from Baker & McKenzie, LLP on January 23. The meeting is intended to informthe membership and those companies with a presence in Mexico about the new fiscal initiatives the Mexican government set for this year. Some of the changes may adversely affect those companies if they don’t meet the new requirements. The topics discussed about the new income tax law included: • New provisions for maquiladoras (as clarified in recent decree and regulations).

• New limitations on deductions of payments to a foreign party.

• New withholding tax on dividends structuring implications for international operations.

• VAT changes for maquiladoras and the automotive sector.

• Custom law changes for maquiladoras, logistic companies and others.

• Financial, energy and other reforms.

Speakers included Baker & McKenzie partners John McLees, Hugo Dubovoy, Manuel Padrón and Mounia Benabdallah.

Mexico’s Fiscal and Legal Update: Detroit The U.S. Mexico Chamber of Commerce Mid-America Chapter is maintaining its presence in the Detroit area by conducting seminars that are of interest to the local business community.

The first event of 2014 was held on

February 6 in partnership with Clayton McKervey PC, a CPA firm specializing in international accounting and tax matters.

The event was held at Troy-based Automation Alley, a technology business association and business accelerator dedicated to growing the economy of Southeast Michigan. Among the topics presented were Mexico’s new fiscal and legal reforms.

The seminar was comprised of two panels of experts who presented and discussed the new income tax law, what is working and what is not, transfer pricing, and new legal reforms that directly affect companies in Mexico.

The speakers in the first panel, moderated by Tim Finerty from Clayton McKervey, provided information about actions companies can take to prepare for and prevent unexpected problems in the fiscal and legal areas. Speakers included Jimmy Cruz, PKF Mexico; Alex Martin, Clayton McKervey; and Marie Alsace Galindo, TechBa. Following this panel was a discussion on manufacturing trends in Mexico and the 2014 outlook. Panelists were Richard Roche, Roche Industries, LLC; Ralph Biedermann, Mexico Consulting Associates; and Jeff Jorge, Global Development Partners, Inc. Ted Morgan from Plante & Moran, PLLC served as moderator.

Prodensa AND Chamber Host Manufacturing in Mexico Workshop Prodensa, a Mexican company offering shelter and real estate services in Mexico, partnered with the Chamber to host a

January 28 workshop on manufacturing opportunities in Mexico. The event was uniquely tailored to the interests of the companies in attendance who were planning to expand operations, establish distribution or initiate manufacturing operations in Mexico.

Prodensa’s executives described their approach in serving their clients and provided a thorough analysis of Mexico’s sourcing opportunities.

Topic discussed were: •Vendor localization and qualification methodology •Sourcing opportunities for commodities and components •Supplier cost reduction projects •Logistics, cross border and intra-Mexico solutions •JV and outsourcing success stories Small Business Workshop in Spanish The Chapter partnered with De Paul University to offer its Spanish speaking members a workshop on business administration on March 6.

El taller estuvo dirigido a empresarios latinos de PYMES que se encuentran en situaciones de: a) ¿Cómo crecer mi empresa?, ¿Cómo maximizar mis utilidades y reducir mis deudas?, ¿cómo puedo mejorar mi manejo de personas?, ¿cómo puedo vender en otros mercados?, ¿cómo puedo organizar mi empresa y mi tiempo? b) Emprendedores que tengan la intención de iniciar su negocio propio. c) Empresarios que se encuentren en los primeros años de operación y requieran de Dirección. d) Empleados operativos considerados por sus jefes para la mejora en el servicio y/o generar una mejora en eficiencia de sus funciones.

Temas a tratar: •Habilidades Directivas y Competitividad.

•Calidad en el servicio, Trabajo en equipo.

•Negociación y Conflicto.

Impartido por: Jorge Smeke Value Generation Consulting y Dean de la Escuela de Negocios, Universidad Iberoamericana de México.

Left to right: Jeff Jorge, Richard Roche y Ralph Biedermann

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Southwest Chapter Dallas, TX Chamber Hosts DFW Airport Development Department

and the United States Postal Service’s approximately 6,000 square foot retail center.

Members of the Dallas/Fort Worth International Airport (DFW) Commercial Development Department attended a brunch hosted by U.S.-Mexico Chamber of Commerce Southwest Chapter to discuss development opportunities available at the airport, focusing on Southgate Plaza and the available restaurant pad sites.

These components, in addition to retail and restaurant establishments, will provide accommodations and amenities for almost 165,000 daily airline passengers, approximately 60,000 on-airport employees, over 4,400 daily patrons of the rental car facility within walking distance from the development, commuter traffic, and local residents of nearby cities. Additionally, bus transit connectivity to both the terminals and regional rail has been integrated into the planning of Southgate Plaza, bringing additional future demand to the development.

Southgate Plaza is currently under construction with anticipated completion by the end of 2014.

John Terrell, vice president of Commercial Development, John Brookby, assistant vice president of Commercial Development, and Carolina Roa, Retail/Office Development and Leasing Manager, gave an overview of this exciting project.

Southgate Plaza is a 32-acre mixed-use “aerotropolis” development that is intended for hospitality, retail, office and restaurant uses. Southgate Plaza is well-positioned at a diamond interchange with recent traffic counts totaling over 100,000 daily near the rental car facility, Airfield Drive, and the south entrance and is accessible outside of the toll plaza for area consumers.

Southgate Plaza will be anchored by a 150,000-square- foot office building that will accommodate over 450 DFW executive and administrative employees, a 137-room Hyatt Place Hotel

Joe Chapa, vice president of International Operations for USMCOC; John Terrell, DFW Airport vice president of Business Development; Josie Orosco, regional executive director of USMCOC; Miguel Lopez, president of Mito Financial; and Hal Bird, president of Hal Bird Group.

Josie Orosco, welcomes new Chamber member Pablo Trinidad, CEO of Picassos Web.

DFW Airport is located between Dallas and Fort Worth, creating easy accessibility to the entire area. It covers 27 square miles (17,000+ acres) and ranks among the top ten in almost every category. In 2013, almost 60.5 million passengers passed through the gates en route to any of 205 destinations, including 56 international and 148 U.S. domestic destinations. It is home to American Airlines.

For more information on Southgate Plaza or other land development opportunities at DFW, please contact Carolina Roa at croa@dfwairport.com or by telephone at (972) 973-4817.

Josie Orosco welcoming new chamber member, Jason Fernandez, associate vice president for Wells Fargo LLC Advisors,

Speaker John Terrell, DFW Airport vice president of Business Development

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The Woodlands Gulf Coast Chapter. The Woodlands, TX Director of TX Office of Economic Development and Tourism Keynotes March Luncheon The Woodlands-Gulf Coast Chapter hosted a luncheon at The Woodlands Resort & Conference Center on March 6 featuring Jonathan Taylor, executive director of the Texas Governor’s Office of Economic Development and Tourism as keynote speaker.

ranging forum for addressing the issues and exploring the technologies that will enhance patient care.

“Inspired and powered by world-renowned MEDICA and in collaboration with top-ranking Texas Medical Center, this groundbreaking trade event [was] unrivaled in scale, scope and caliber in the United States.” (Source: www. medicalworldamericas.com) Latin America Health Summit

During his speech, Taylor spoke of the importance of Mexico as Texas’ number one foreign trade partner where more than $170 billion will be transacted during 2014—more than $145 million per day. Texas is a gateway for Mexico trade in key industry sectors such as energy, health, transportation and logistics, banking and tourism.

The event had a great turnout and received television coverage on Univision and Telemundo.

In addition to the medical conference, the USMCOC organized the first Latin America Health Summit hosted at Rice University’s BioScience Research Collaborative Center on May 1-2 for participating healthcare providers, hospital administrators and, government health officials who attended the conference. The Summit offered opportunities for one-on-one meetings between Latin American hospitals and Texas Medical Center hospitals.

Networking with International Resource Group

On May 2, visitors from Latin America also had the opportunity to tour Texas Medical Center facilities.

The Chapter hosted a networking mixer with Chamber member International Resource Group (IRG) on March 13 at La Casa del Caballo. The event was well-attended with more than 80 present.

Both the conference and summit are to be annual events and grow in the future. The Chapter’s contribution is to provide new partnerships with Mexico health organizations resulting in the improvement of overall health in Mexico.

IRG’s mission is to “support the business endeavors of domestic and international investors by providing an array of resources…enabling them to successfully bring talent, goods, services, and technology to the United States, thereby encouraging economic development in their respective communities.” (IRG Web site: irghouston.org)

More details at www.medicalworldamericas.com and www. usmcocgc.org.

Chapter Facilitates Healthcare Conference and Health Summit Medical World Americas Conference and Expo The U.S.-Mexico Chamber of Commerce Woodlands-Gulf Coast Chapter was proud to support the first annual event in Houston to promote world health, the Medical World Americas Conference, at the George R. Brown Convention Center on April 28-29, 2014.

The Chapter joined forces with the Greater Houston Convention and Visitors Bureau and the Texas Medical Center in the launch of the inaugural health conference.

More than 3,000 attendees were expected. Among those were Latin American hospital administrators; government health officials; medical manufacturers, suppliers and distributors; specialized physicians; and pharmaceutical companies. “[The] all-new conference and exposition…[gave] medical professionals from across the Americas, a top-quality, wide-

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THE COVER / ARTÍCULO DE PORTADA

Valle de México Chapter.

México City

El Capítulo Valle de México recibió en la Ciudad Capital a la Misión de Comercio y Protocolo de la ciudad de Phoenix El pasado 20 y 21 de marzo, el Capítulo Valle de México de la United States-Mexico Chamber of Commerce recibió en la Ciudad de México a una Delegación proveniente de la Ciudad de Phoenix. La Misión Comercial y de Protocolo, encabezada por el Alcalde de Phoenix, Greg Stanton, tuvo entre sus objetivos el establecimiento de una mayor relación comercial entre el estado y México, así como el fortalecimiento de la vinculación académica entre universidades como University of Arizona y Arizona State University con instituciones de educación superior en México así como institutos de investigación.

Acompañados por José García Torres, Presidente del Capítulo Valle de México, José Andrés García Rosales, Director de Desarrollo de Negocios y Claudia Vidal, Directora Ejecutiva; la Delegación de Phoenix participó en un desayuno con el Dr. Sergio Alcocer Martínez de Castro, Subsecretario de Relaciones Exteriores para América del Norte. En este encuentro privado, se habló sobre los temas más relevantes discutidos en la reciente Cumbre de Líderes de América del Norte, reunión que se llevó a cabo el pasado mes de febrero entre los Presidentes Enrique Peña Nieto, Barack Obama y Stephen Harper. Las líneas de acción establecidas se dividen en cuatro grandes rubros: prosperidad compartida e incluyente, nuevas oportunidades de cooperación, seguridad ciudadana, y temas hemisféricos y globales. Estos cuatro rubros incluyen temas energéticos, de medio ambiente, salud pública, así como las ventajas logísticas de estos tres países, especialmente valiosas en la interacción con otros bloques.

Para el fortalecimiento de la relación comercial, la Delegación de Phoenix sostuvo reuniones de trabajo con el Secretario de Economía, Ildefonso

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Guajardo y con el Director General de ProMéxico, Francisco González. Actualmente, México es el principal socio comercial para Arizona, con quien el estado realiza operaciones comerciales por el órden de 7 mil millones de dólares anuales. Algunos de los sectores más relevantes son el agroalimentario, manufactura electrónica y minería entre otros. A partir de estos encuentros, se trabaja en la propuesta de abrir una Oficina de Representación en el Exterior de ProMéxico en la Ciudad de Phoenix, iniciativa que implicará la coordinación entre la Secretaría de Economía, ProMéxico, la Embajada de México en Washington y la Ciudad de Phoenix.

Entre algunas otras actividades, la comitiva se reunió con el Director de Asuntos Internacionales de la Secretaría de Energía, el Mtro. Alejandro Amerena Carswell para discutir sobre la Reforma Energética recientemente aprobada en México y las oportunidades que existe en el campo de las energías renovables.

Se destaca la importante participación que tuvo durante estos dos días el Embajador de los Estados Unidos en México, Anthony Wayne, al asistir a una Recepción ofrecida por la Universidad de Arizona así como a un desayuno privado con la delegación para abordar

Alcalde de la Ciudad de Phoenix Greg Stanton.

los temas derivados de la Cumbre de Líderes de Amércia del Norte y la perspectiva de Estados Unidos.

La visita de la Misión Comercial y de Protocolo de la ciudad de Phoenix concluyó con un desayuno al que asistió como invitada Jill Metcalfe, Presidenta de la Asociación de los Estados Unidos en México y Directora de Casa San Antonio y Shahrzad Dowlatshahi Director de Relaciones Internacionales y Jefe de Protocolo de la Ciudad de San Antonio. Ante el interés de la ciudad de Phoenix por abrir una oficina de representación en México, se habló sobre los retos y oportunidades de establecer una oficina así como los mecanismos necesarios para exponenciar la actividad comercial y de inversión.

Entre la distinguida comitiva de la Ciudad de Phoenix, cabe destacar la participación de Sal DiCiccio Consejal de la Ciudad, Tamie Fisher, Directora de Aviación, Hank Marshall, Director de Desarrollo Económico, Andy Tobin, Presidente del Congreso de Arizona, Margie Emmermann, Asesora de la Gobernadora en Políticas Públicas para México y América Latina, Ruben Alvarez y Jaime Molera Socios de Molera & Alvarez, Glenn Hamer Presidente de la Cámara de Comercio de Arizona y Todd Sanders, Presidente de la Cámara de Comercio de Phoenix.

Pacífico Chapter Guadalajara, Jal.

La Camara de Comercio Mexico - Estados Unidos Capitulo Pacifico abre su primera delegación en el estado de Nayarit Lá Cámara de Comercio de Méxcio y EE.UU (USMCOC)., en su capítulo Pacífico Guadalajara, abrió su primera oficina en la ciudad de Tepic, capital del Estado de Nayarit. Al cargo de esta nueva delegación estará el doctor Hector Torres, uno de los más prestigiosos médicos de este Estado, que compagina su actividad profesional con una intensa actividad empresarial, acompañado por su hija Ana Torres, que está al frente de la empresa de comercio exterior Servicios Globales el Angel.

La presentación oficial se realizó en Salón de Evento María Magdalena de Tepic, y acudió un nutrido grupo de empresarios de la zona, así como las principales autoridades de las instituciones empresariales del Estado y del Gobierno de Nayarit.

Por parte de la USMCOC Pacific Chapter acudieron su presidente, licenciado Francisco Plancarte, el consejero de la Cámara Francisco Castellanos. Acompañaron también al acto varios miembros de la Cámara.

Entre las personalidades que participaron en esta presentación estaban el Lic. José Luis Naya González Secretario de SEDECO Nayarit, y represento al Gobernador de Nayarit Roberto Sandoval Castañeda.

También estaban presentes el Lic. Alejandro Mora Delgadillo, Encargado de Comercio Exterior del estado; el Presidente CANACO Tepic LIC. Jaime Alberto Rivera Rosas; el Presidente ANACO Bahía de Banderas-Compostela, José Luis Camacho Flores y el Presidente CANACINTRA Nayarit Ing. Cesar Manuel Miramontes Jaime.

De izquierda a derecha, Lic. Alejandro Mora Delgadillo, Encargado de Comercio Exterior en SEDECO Nayarit; Francisco Castellanos; Dr. Héctor Leonardo Torres Soltero; Lic. Francisco Plancarte; Lic. José Luis Naya González Secretario de SEDECO Nayarit y Empresario de Nayarit.

El acto sirvió para presentar los beneficios de pertenecer a la USMCOC y la capacidad que tiene nuestra institución para abrir el comercio de los estados Unidos a las empresas de México.

Cabe mencionar que el Lic. Lic. José Luis Naya González Secretario de SEDECO Nayarit, fue el que realizo la clausura del evento y se le volvió a tomar protesta al Dr. Héctor Leonardo Torres Soltero como vicepresidente de la USMCOC en región de Nayarit.

Gary Herbert, gobernador de Utah, se reunió con el capítulo Pacifico de la USMCOC El pasado 9 de abril, el gobernador de Utah, Gary Herbert, visitó la ciudad de Guadalajara encabezando una misión comercial con el objetivo de explorar oportunidades de comercio e inversión, y ampliar la colaboración en educación superior e innovación tecnológica entre los estados de Jalisco y Utah.

Durante la visita, Gary Herbert se reunió con parte del comité ejecutivo de la US Mexico Chamber, Pacific Chapter, encabezado por su presidente, el licenciado Francisco Plancarte. En ese encuentro se puso de manifiesto la necesidad de ahondar mucho más en las relaciones entre los dos Estados, destacando por parte del presidente de la USMCOC que esas relaciones deben ir mucho más allá de lo meramente económico, para llegar a una relación social, cultural y educativa de primer nivel.

La delegación que acompañó al gobernador estadounidense en su primera visita a México estuvo integrada por más de 30 representantes de empresas y organizaciones de ese estado.

Gary Hebert, durante su intervención ante empresarios de Jalisco y Utah en el hotel Fiesta Americana de Guadalajara.

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Guanajuato Chapter.

Leon, Gto.

La USMCOC visita la empresa Pirelli.

El pasado mes de enero la empresa Italiana Pirelli -miembro de la USMCOC Capítulo Guanajuato y establecida en el estado de Guanajuato- invitó a los afiliados de la USMCOC a realizar un recorrido por sus instalaciones, con el objeto de poder observar su proceso productivo y como esta empresa de clase mundial inserta las variables económicas, técnicas, sociales y ambientales en la marca, producto y actividades técnico-operativas de PIRELLI. Sustentabilidad e innovación los nuevos retos

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El estado de Guanajuato reconoce que en la actualidad la ciencia aplicada, la innovación y la sustentabilidad son las herramientas que permiten mejorar tanto el bienestar social y empresarial de la región. Por lo anterior, hoy en el estado de Guanajuato se ha fomentado la creación de parques tecnológicos que trabajen directamente con el sector empresarial y la sociedad en general. Actualmente son 7 los parques tecnológicos en el estado, de los cuales tres están situados en la ciudad de

León.

El objeto principal de estos parques es promover la competitividad, la incubación de negocios “verdes”, el fomento al empleo, la promoción de nuevos sectores económicos y la eficiencia productiva. Es por esto, que a partir del día 20 de marzo el Centro de Producción más Limpia del Bajío (CPLB) –Proyecto de sustentabilidad de la USMCOC Capítulo Guanajuato- tendrá

El gobernador del estado de Guanajuato Miguel Márquez, visitando la oficina del CPLB dentro de las instalaciones del Parque de Innovación de la universidad De La Salle Bajío.

Inauguración del Parque de Innovación de la Universidad de La Salle Bajío. De derecha a izquierda, Jaqueline de la Rosa, empresa TIBA; Antonio Vargas, USMCOC-; Gonzalo Torres, Consultor; Carlos Montes de Oca, empresa Tiba; Ana Carmen Aguilar, Instituto de Ecología y Sergio Ponce USMCOC.

Grupo de empresas participantes en el recorrido por las instalaciones de PIRELLI.

un espacio laboral dentro de las nuevas instalaciones del Parque de Innovación de la universidad De La Salle Bajío. Con lo cual, el CPLB entra de lleno en las políticas públicas estatales y municipales en lo referente a la generación de proyectos de responsabilidad Social y de Desarrollo Sustentable que sigan moviendo de forma positiva al estado de Guanajuato.

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An Interview

with Mexico City´s Governor

Miguel Ángel Mancera Espinosa

M

exico City´s Governor, Miguel Ángel Mancera Espinosa, graduated with honors from the National Autonomous University of Mexico (UNAM), with a bachelor’s degree in law. He holds a masters degree in law from the Autonomous University of Barcelona and completed his Ph.D. in law at the Graduate School of Law at UNAM, where he graduated with honors as well.

Governor Mancera Espinosa is a tenured professor of law at the Autonomous Technological Institute of Mexico (ITAM). He has published several books such as The Attempt on the Penal Code for the Federal District, and The Exchange Tentative Theory and Practice, among others.

INTERVIEW/ ENTREVISTA

He entered public service in 2000 as an advisor to the Assembly of Representatives of the Federal District serving on the Committee on Enforcement and Administration of Justice.

That same year, he was appointed Director of Research and Procedures of the Federal District´s Department of Public Security, where he also held the positions of Director of Complementary Police Tracking, Director General and Advisor to the Secretary of Public Security of the Federal District.

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In 2005, he was appointed general counselor of the Department of Social Development of the Federal District Government.

Mancera Espinosa also worked as director of the Judicial Branch of the Federal District.

He joined the Federal District Attorney General Office (PGJDF) in 2006 and, by 2008, had become head of that agency. At that

time, he was also appointed executive secretary of the Council of Public Security of the Federal District, and representative of the central zone of the National Conference of Law Enforcement.

Mancera Espinosa was elected head of the elected government of Mexico City on July 2012, and, on December 5, 2012, he took office as governor for the term 2012-2018. In a recent interview with Alliance Magazine, Governor Mancera Espinosa shared his views on a few key issues: What has been the amount of foreign direct investment in CDMX so far in your administration?

During 2013, Mexico City recorded the highest growth rate of foreign direct investment since 2008, growing 234 percent— more than twice the national rate which is 104.3 percent. On a local basis, the amount totaled $21,882.5 million, representing 62 percent of the total foreign direct investment in the country.

Of that, 67.6 percent corresponds to new investments.

Eighty-six percent of such investment has been directed to the industry and 77.6 percent has been directed to the manufacturing sector.

What is Mexico City doing in order to position itself as an investment center?

Mexico City is enhancing the competitiveness of micro-small and medium-sizes businesses–known as MIPyMES-in order to trigger “economies of scale” and to establish synergies among local suppliers and large businesses that help to boost

What industries have reacted the best to the investment proposals and why?

At the time, there are 17 industries immersed in a growing phase: Industry: • Food and beverages • Pharmaceuticals • Plastics • Clothing • Auto parts • Creative businesses • Manufacturing of aerospace equipment Services: • Support to businesses services • Specialized financial services • Entertainment services • Education services • Tourism services

• Hospital and medical services • Research and biotechnology • innovation services • Logistic services • Fashion and design • Information technology and communications • Development of software and informatics services What significant investments do you expect will occur in the city during the next three years?

In 2013, we signed a number of agreements with pharmaceutical, real estate companies, developers, information technology businesses, and financial companies. They committed to invest over $12 billion (dollars?) during the next years.

• The National Chamber of the Telecommunications´ Electronics and Information Technologies Industry (CANIETI): $1.3 billion • Neolpharma Group: $30 million

• Bayer Company: $46 million • BBVA Bancomer: $1.9 billion • Real Estate Developers Association (ADI): $9 billion

Would you explain the guidelines of your future work program in order to attract investments and why such guidelines have been chosen, and please comment on the recently approved Economic Development Law. The General Development Program 2013-2018 establishes: Right from the very first month of my administration, we established the Cross-Agency Commission for the Advancement and Promotion of Economic Development whose goal is making of Mexico City a city with higher levels of competitiveness, equity and progress. We are studying new ways for making of the city not only a tax-collector, but a city that produces wealth.

The lines of action are oriented

INTERVIEW / ENTREVISTA

the economy, by producing high quality jobs and promoting and improving the international competitiveness of Mexico City.

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toward several areas including digital connectivity, facilitation of the financial services, promotion of tourism, promotion of investment, improvement of the credits available on the market for small and medium size businesses, creation of jobs, support to the agricultural sector, industrial development, transformation of the Central Wholesale Market (Central de Abasto), judicial certainty for opening new businesses, support to zones of economic and social development (Zodes), and development of the public space – among others-.

This administration has three guiding strategies oriented to: 1) Attraction of investments; 2) Improvement of the business environment; and 3) Public-private partnerships while we transform into a “digital city.”

Would you please explain the tax benefits that the city offers to the investors?

• Reduction of the fees of the Public Registry of Property and Commerce.

• Reduction of taxes on the purchase of real estate applicable to industrial areas.

• Reduction of ISN applicable to new businesses, to businesses that substitute imported materials for local materials, to businesses that create new jobs and to the “maquila” segment that exports its products.

• Reduction of the property tax when a business enhances its installed production capacity.

• Reduction of the fees of issuing construction licenses to construct, refurbish or adapt commercial and industrial spaces.

• Special incentives for research and technology development projects.

INTERVIEW/ ENTREVISTA

What is CDMX doing in order to protect investors?

40

In order to protect investors, we are improving the regulatory environment by means of an accurate assessment of the laws, of the regulations, and of other provisions that must be complied with by the different businesses of the capital.

41

Mexico’s Social and Fiscal Reform

By Dr. Luis Videgaray Caso, Minister of Finance and Public Credit of Mexico.

Introduction

OPINION ECONOMY / OPINIÓN ECONÓMICA

L

42

ast year, Mexicans witnessed a broad and open debate about a series of structural reforms that will change the economic and social course of our country. Each of these reforms is individually relevant, but together they represent a comprehensive set of actions whose purpose is to allow Mexico to significantly improve its economic potential. While in some cases intense discussions took place for their approval, they enriched the proposals and the agreements reached stand in sharp contrast to those observed in other countries.

low growth. All of them agree that low productivity growth has been the key factor. According to the National Statistics Institute (INEGI), total factor productivity in 2011 was 8.2 percent lower than in 1990. This means an annual reduction of 0.4 percent. However, productivity has increased at high positive rates in other emerging countries that have experienced sustained periods of high growth including Korea, Chile and Ireland.

Mexico´s economic growth in the last decades has been insufficient for standards of living to converge with those in industrial countries. Between 1980 and 2012, per capita GDP grew at an annual rate of 0.7 percent, well below other countries such as Chile (3.3 percent), Korea (5.2 percent), and the U.S. (1.6 percent).

The reforms that have taken place in the past year and a half were designed to eliminate obstacles for higher productivity growth. They include the labor reform approved in November 2012, a few days before the new administration took office.

This reform has incorporated new hiring models that are more adequate for a modern economy, such as temporary and introductory contracts. It also includes measures to accelerate the resolution of legal disputes over labor issues. Through these changes, the reform seeks to improve the operation of the labor market by reducing rigidities.

Different analyses and studies explain Mexico´s

In December 2012, an education reform was

Why did Mexico need the structural reforms?

The energy reform was approved in December 2013.

It provides a modern legal framework for the industry.

This reform will spur job creation, enhance productive activity, and provide a greater availability of energy for the entire economy. It also creates a sovereign fund to generate long-term savings in order to guarantee that oil revenues are correctly used to promote development.

Finally, a financial sector reform was approved in November 2013. It will promote the availability and less expensive credit for firms of all sizes. In addition, Congress is still discussing a reform to strengthen the fiscal discipline of local governments.

TOTAL PUBLIC EXPENDITURE, 2011 (% GDP) 46.5

50 41.7

40 27.1

30 20

18.8

10 0 Mexico*

Latin America United States

Source: OECD, IMF, PEF 2013. *Preliminary data for 2013. Does not include spending in Pemex CFE.

TAX REVENUE, 2011 (% GDP) 26.3

30 25.1

The need for a social and fiscal reform As part of the broad structural reform agenda to increase productivity, President Peña Nieto submitted social security and fiscal reform to Congress. It is based on the principle that the fiscal system should promote growth and fairness, and that the country´s social security system should be strengthened to cover the basic needs of all Mexicans.

While fulfilling these goals will require a stronger presence of the state, public expenditure will not grow to the levels observed in Europe or in some Latin American countries, such as Brazil, where it exceeds forty percent of GDP. Before the Reform, public expenditure in Mexico was well below that observed in practically any economy with a similar level of development. At 19 percent of GDP, it was smaller than in market-oriented economies, like Chile (25 percent of GDP), Colombia (29 percent of GDP) or the U.S. (42 percent of GDP).

A state that is too large and intrusive can certainly hinder growth. However, if the state is too small, it can hardly provide a framework conducive to economic growth. A fair justice system, working electoral institutions, investment in research and development, expansion of infrastructure, and more modern schools are all activities that require the participation of the state and public expenditure. That, in turn, requires an increase in public revenue in order to avoid higher public debt.

Non-oil tax revenue in Mexico during recent years has been approximately ten percent of GDP. This level is lower than what is observed in other OECD countries (average of 26 percent), such as, the U.S.

OECD

20

10

18.4 9.2

0 Mexico*

Latin America United States

OECD

Source: OECD, IMF, PEF 2013. *Preliminary data for 2013. Does not include hydrocarbons fees.

(25 percent), and other Latin American countries (average of 18 percent). As a result, limited revenues have meant low expenditure in health and education programs, public investment, or public safety. In all these cases, expenditure as a share of GDP in Mexico is much lower than in OECD economies or in the rest of Latin America.

One of the factors contributing to low revenues is the complexity of our tax system. According to the World Bank, firms in Mexico devote more time to fulfill their tax-related duties than firms in the U.S; Colombia or Korea. This drives some firms, especially the smallest ones, into the informal sector. At present, six out of every 10 workers are employed in the informal sector of the economy.

Informality affects economic growth because of the lower productivity of informal firms, and it also weakens the social security system because informal workers lack access to it. Two thirds of adults older than

OPINION ECONOMY / OPINIÓN ECONÓMICA

approved. It is expected that this reform will have a positive impact on the creation of the human capital needed for the country to compete in the global economy and increase labor productivity. Telecom and economic competition (anti-trust) reforms were approved in April 2013. They will strengthen competition in all markets, thereby reducing the cost of strategic inputs, such as telecom services, and improve the investment climate.

43

TAX BURDEN ON CORPORATE INCOME, 2013 Corporate income tax plus personal income tax on dividends (%) 70 60 37.0

50

30.0

40 30 20 10

France United States* Denmark Canada* South Korea Portugal* Belgium Spain Germany* Ireland Norway Israel United Kingdom Austria Sweden Netherlands Australia Luxembourg* Japan* Italy Finland Chile Slovenia Mexico with reform Switzerland* Iceland Poland Turkey Greece New Zeland Hungary Czech Republic Mexico without reform Slovak Rep Estonia

0

65 are excluded from social security, and thereby lack access to medical services and retirement pensions. In addition, Mexico is the only OECD economy without an unemployment insurance program.

What are the main features of the social and fiscal reform?

OPINION ECONOMY / OPINIÓN ECONÓMICA

The reform was designed to address the shortcomings of the Mexican fiscal system. It strengthens the financial capability of the state by broadening the bases of the primary consumption and income taxes. For that purpose, it eliminates or reduces the exemptions, allowances and preferential treatments that eroded the revenue generating capacity of the tax system in Mexico. The impact of the reform is to increase revenues by one percent of GDP in 2014, and by 2.5 percent by 2018, when all its components are in full force.

44

In order to simplify the tax system, the reform eliminated the Alternative Minimum Tax on Business Income (IETU) and the Tax on Cash Deposits (IDE).

It also created a new abridged income tax law. As a result, corporate income will only be subject to a single tax, rather than three. This simplification is particularly relevant for smaller firms that have less human and financial resources to devote to complying with tax-related duties.

To promote formality, the reform created a new Incorporation Regime, which will work as an entry point into formality for small firms and their workers.

This regime will provide incentives to its participants, including initial discounts on taxes and social security fees, and access to credit and training programs.

It will also gradually prepare taxpayers with low administrative capabilities for an eventual transition to the general regime.

The fiscal reform improved the fairness of the tax

system, by establishing certain taxes on sources of income that are mainly concentrated on the richest section of the population, such as dividend payments and capital gains from stock sales. The rate of the new taxes, ten percent, is on the lower end of what is observed in most OECD economies, including the U.S. Combined with the corporate tax rate, which was maintained at 30 percent, this guarantees that the Mexican economy will preserve its competitiveness at the international level. The overall tax rate on capital income (including the corporate income tax and personal taxes on dividends and capital gains) will remain one of the lowest among OECD economies, below that observed in fast-growing emerging economies like Chile and Korea, and much lower than those of our main trade partners.

The social component of the reform, still under discussion in Congress, seeks to strengthen the social security network through the creation of a universal pension for adults above the age of 65, and an unemployment insurance program for formal sector workers. The reform also included measures to improve the quality of public expenditure. All government agencies will have to comply with stricter accountability requirements, including the obligation to publish evaluation results.

Final Remarks We have taken strong steps to move Mexico to a path of higher growth. The structural reforms that have been approved do not represent an immediate solution to the country´s economic and social problems, and they leave a series of challenges to be addressed for their full potential to be fulfilled. However, the consensus built around the need to increase economic growth, as well as the maturity of the country´s democratic system, are reasons for optimism about the prospects for additional progress in the construction of a stronger country.

Energy Reform:

Scope & Business Opportunities in Mexico Sergio Guaso, Pemex Exploration & Production

OPINION ENERGY / OPINIÓN ENERGÉTICA

Mexico is beginning a new energy era. The constitutional energy reform approved in December 2013 is the most significant change in the last seven years. Prior to the 2013 energy reform, the common perception inside and outside Mexico was that it was politically impossible to discuss a delicate issue like oil. However, the majority in Congress agreed on a far-reaching legislative agenda which included reforms to key sectors such as energy, finance, telecommunication and education.

46

A

fter more than 70 years of a state monopoly on energy, the status quo in the industry became unsustainable.

Since 2004, production at Cantarell, Mexico’s largest oil field, declined almost one million barrels per day. Today, the country is already a net importer of refined petroleum products, gasoline in particular. And, even though it has vast gas resources, Mexico currently meets its power generation demand via gas imports from the U.S. Today, there are real reasons for a growth of Mexico’s energy domain. First, Mexico is an open economy that offers solid guarantees and legal certainty across all sectors. Second, Mexico’s hydrocarbon materiality has enormous potential. It is the world’s tenth largest oil producer, and also holds vast shale resources estimated to be the sixth largest worldwide. Mexico’s untapped prospective resources are approximately 115 billion barrels of oil equivalent. Third, the constitutional energy reform is broad and competitive and is bound to change Mexico’s energy landscape.

Energy reform provides the following key changes: 1. All the energy value chain is open to private investment. The private sector is allowed to participate in upstream business on behalf of the state through four types of contracts: licenses, production sharing, profit sharing and service contracts; the contractual and fiscal terms will be defined in the secondary legislation. The reform allows private investment in refining, pipelines, storage and distribution of hydrocarbons and power generation.

remains the head of the industry and continues to determine energy policy and planning. The National Hydrocarbons Commission (CHN), the E&P regulator and technical arm of Sener, will oversee exploration activities, conduct bidding rounds and award host-government contracts to Pemex and private companies. Importantly, the Ministry of Finance (SHCP) will establish the fiscal terms applicable to each contract including royalty rates, economic parameters, and other taxes. It will determine the key criteria of the Mexican Petroleum Fund for Stabilization and Development, the new oil sovereign wealth fund which will be overseen

by Mexico’s Central Bank (Banxico) and which will administer oil revenues.

The Energy Regulatory Commission (CRE), which regulates midstream and downstream activities, is made autonomous under the reform. Additionally, two new entities own and operate the electric grid and the pipeline systems, respectively, National Electricity Control Center (CENACE) and the National Natural Gas Control Center (CENAGAS).

OPINION ENERGY / OPINIÓN ENERGÉTICA

2. New regulatory framework and institutional roles. The Energy Ministry (Sener)

47

3. Pemex and the Federal Electricity Commission to be state-owned productive companies. Their main focus should be to increase

revenues just as any other company. They will be given more flexibility in organization, management and allocation of resources. The boards of both companies will have five independent members and five representatives of the Federal government, appointed by the President, and the Secretary of Energy will preside over them. The board of Pemex will no longer have Union representatives.

E&P future business opportunities and partnering with Pemex

OPINION ENERGY / OPINIÓN ENERGÉTICA

The array of contract options made available by energy reform (licenses, production sharing, profit sharing, and services contracts) aims at having the best model to develop the diversity of hydrocarbon assets in Mexico.

By having a different contract per asset type, Mexico will be able to attract companies with the appropriate expertise and maximize its oil rent.

48

Two options for entering into Mexico upstream sector: 1. Round Zero began on March 21, 2014, with Pemex’s request to the CHN for concessions to explore and develop certain areas. The request includes 83 percent of Mexico’s 2P reserves and 31 percent of prospective resources, 22.5 and 35.6 billion barrels of oil equivalent, respectively. Pemex has asked to keep the production fields as well as key exploration areas where it has commercial discoveries, including deep water Gulf of Mexico. Likewise, in the southeast basins, Pemex wants to maintain areas in which it has invested in exploration. In Chicontepec, one of Mexico’s largest fields, Pemex chose the areas with existing activity. As for unconventional resources, it opted for four areas, which account for 8.9 billion barrels of oil equivalent.

As a result of Round Zero, to conclude on September 17, Pemex will be able to “migrate” concessions into contracts and enter into joint ventures with private companies to develop these areas. The CNH will determine the contract type and the SHCP will define the financial terms, all to be detailed in the

secondary legislation. In 2014, Pemex will focus on developing a partnership strategy and prepare for upcoming rounds.

The Ministry of Energy foresees that the first bidding 2.round may take place in 2015. Pemex and private companies will be able to bid― on their own or under a consortium with other companies― on areas offered by the CNH. Pemex will thus compete and partner as any other company.

Bottom line It is expected that the reform will allow the country to compete successfully worldwide to attract investors as it encompasses a stable policy framework and significant hydrocarbons materiality. A spillover effect is likely to surface with more employment, regional development, and government revenues. Needless to say, hydrocarbons’ production and reserves will increase as more prospective resources are untapped.

Moreover, with the opening of the hydrocarbons sector, the structure of the industry will be radically altered.

Pemex and CFE will no longer be the sole operators in the country as they have been for many years. The new energy model acknowledges that new players with diverse expertise and size are required to reach the needed investment in Mexico’s energy sector.

The author Sergio Guaso is senior vice-president of Exploration and Production Business Development at Pemex.

For more than 13 years, he has led key aspects of hydrocarbon production contracts in Mexico: design, modeling, promotion, bidding round, and management. In this role, he has launched 24 oil and gas contracts which have increased the country’s hydrocarbon reserves and production.

Since 1990, Guaso has developed a broad career at Pemex, working in the areas of econometric models for the internal demand of petroleum products, determination of internal and transfer prices, strategy and negotiation of oil refining contracts in the U.S., and investment allocation for Pemex E&P projects.

He holds a Bbachelors degree in economics.

THE WOODLANDS GULF COAST CHAPTER Law Office of W OhYan Sector: Legal Luis Hess Law www.luishesslaw.com Sector: Legal TaxiClub www.taxiclub.com Sector: Transportation Nerium International www.nerium.com MID -AMERICA CHAPTER. CHICAGO, IL Interlake Mecalux www.interlakemecalux.com Sector: Industrial Caterpillar www.caterpillar.com Sector: Machines CSX www.csx.com Sector: Railways

UP www.up.com Sector: Railways UTI www.uti.com Sector: Logistics Value Generation www.valuegeneration.com Sector: Services Western Union www.westernunion.com financial

Endeavor www.endeavor.org Sector: Entrepreneurship Holland & Knight www.hklaw.com Sector: Law Firm Inmobiliare Magazine www.inmobiliare.com Sector: Publishing Magnetic Metals www.magmet.com Sector: Industrial Manufacturing Mendoca Partners www.mpcpallc.com Sector: Law FIrm

Cluster Industrial www.clusterindustrial.com.mx Sector: Communications HERBALIFE www.herbalife.com.mx Sector: Services Roberto Preciado Sector: Implantes Médicos

OMEGA Construction Group www.omegacgp.com Sector: Construction

Peninsula Press www.peninsula-press.com Publishing

Toray www.toray.com Sector: Autoparts

PICASSO’S WEB www.picassosweb.com Sector: Dig. Mkt. Ap & Web Development

Ramirez, Gutierrez-Azpe, Rodriguez-Rivero y Hurtado S.C www.ccrga.com Sector: Law Firm

CALIFORNIA REGIONAL CHAPTER

SOLARIS TECHNOLOGIES, INC. www.solartechnologies.com Sector: Telecommunication Towers

Brian Shube Consulting Inc. www.brianshube.com Sector: Consulting

Turanzas, Bravo & Ambrosi www.turanzas.com.mx Sector: Law Firm

Cuatrecasas www.cuatrecasas.com Sector: Law Firm

WTAS www.wtas.com Sector: Tax Firm

CUnna Sector: Social Impact

VALLE DE MEXICO CHAPTER. MEXICO, DF

KCS www.kcs.com Sector: Railways

Developing World Markets www.dwmarkets.com Sector: Financial Services

Micron Industries Corp. www.micronpower.com Sector: Industrial

Directum Translations www.directumtranslations.com Sector: Translation Services

Goodrich Riquelme Asociados www.goodrichriquelme.com Sector: Lawyers

Prodensa www.prodensa.com Sector: shelter services

Dreyfus Global Trade LLC www.dreyfusglobal.com Sector: Financial Services

GE Capital www.ge.com Sector: Financial

GUANAJUATO CHAPTER. LEON, GUANAJUATO

SOUTHWEST CHAPTER. DALLAS, TX

NORTHEAST CHAPTER. N.Y.

EPA America www.ep-america.com Sector: Logistics

Servicios Globales el Angel S.A. de C.V Sector: Internatinal Trade Consulting

Niño de Rivera Communications Inc. www.reneeninoderivera.com Sector: Social Impact

Surgo Group www.surgogroup.com Sector: Digital Technology

DHL www.dhl.com Sector: Logistics

PACIFICO CHAPTER. GUADALAJARA, JAL.

Intrlingua www.interlingua.com.mx Sector: School of Leanguages Sandler Travis de México Sector: Consulting

TIBA México www.tibagroup.com/mx Sector: Consulting

COFSA www.cofsa.com.mx Sector: Travel Agency/Tourism Jamie Gutierrez www.lawa.org Sector: Airport/Transportation Latin Escapes www.latinescapes.com Travel Agency/Tourism Los Angeles World Aiport Norman Krieger Customs Brokers www.nkinc.com Sector: Customs Broker NUTRIDATA www.nutridata.com Sector: Labeling data Co. Relojes el Centenario www.centenario.com.mx Sector: Clock manufacturer Wood Products Sector: Wood Products/ Manufacturing

NEW MEMBERS / NUEVOS MIEMBROS

New members to the United StatesMexico Chamber of Commerce

MEMBER DISCOUNTS Consult your regional chapter to obtain discounts:

· Holiday Inn Express & Suites Mexico City at the WTC · Four Seasons Hotel Mexico, D.F. · St. Regis Mexico City · NH Hoteles Mexico nivel nacional · Marquis Reforma Hotel · Marriott Reforma Mexico City · Hoteles Radisson · Ostar Grupo Hotelero · Ostar Hotel Group has Geneve Hotel in Mexico City, the Racquet Cuernavaca, Hotel Francia Aguascalientes, Veracruz Centro Historico Hotel, Hotel Viva Villahermosa and Ramada Hotel Getaway in Orlando. · Hoteles Misión In all of its 40 locations in Mexico till

December 20th 2014. · Sheraton Maria Isabel Hotel & Towers THE WOODLANDS - GULF COAST CHAPTER The Woodlands, TX · The Woodlands Resort & Conference Center GUANAJUATO CHAPTER León, Gto. · MEXICO PLAZA HOTELS Locations: Leon, Guanajuato, Irapuato, Salamanca, Celaya and Guadalajara. Coming soon: Aguascalientes, Silao y

San Miguel de Allende · Hotel La Nueva Estancia MID-AMERICA CHAPTER Chicago, IL · Aeromexico · United/Continental · American Airlines · Crown Paradise Resorts · Las Brisas Hotels INTER-AMERICAN CHAPTER Miami, FL · Interjet · Aeromexico · Sports Club CALIFORNIA REGIONAL

CHAPTER Los Angeles, CA · Aeromexico · Alaska Airlines · Benckmarkemail en Espanol · Agencia Aduanal Adolfo Ayala Bejarano · Correduria Publica No. 23 · Cima Designs · Lewis and Lewis Insurange Agency, Inc. · Todd Becraft Attorney at Law · Trio America PACÍFICO CHAPTER Guadalajara, Jal

UPDATES / ACTUALIZACIÓNES

VALLE DE MÉXICO CHAPTER Mexico City

· ABC Global Group

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MEMBER HIGHLIGHTS / MIEMBRO DESTACADO

50

A Stronger GM Through People, Partners and Products

Today GM’s 212,000+ employees work in 396 facilities touching six continents, they speak more than 50 languages and touch 23 time zones.

The company’s extraordinary turnaround closes a difficult chapter in the automaker’s history. Its story begins in 2010 when GM completed the world’s largest initial public offering, emerging with a solid financial foundation. A new lean, efficient, market-facing GM operation is driving growth through a refreshed product line and four major brands: Chevrolet, Buick, GMC, and Cadillac.

Grace Lieblein, Vice President of GM’s Global Purchasing and Supply Chain Worldwide, GM’s global supply chain consists of close to 20,000 suppliers, and supplier-sourced parts comprise approximately two-thirds of its automotive costs. Playing a lead role in this complex part of the business is Grace Lieblein who was appointed vice president, Global Purchasing and Supply Chain, in 2012. Lieblein is responsible for GM’s purchasing activities and supply chain and logistics operations worldwide. She is working with suppliers to encourage the lean concepts necessary to succeed in a tough and competitive environment.

“At GM we’re focusing on building stronger relationships and working more closely with our suppliers,” says Lieblein. “They are critical to maintaining our competitive edge.”

Before her current position, Lieblein was president and managing director of GM Brazil. Prior to coming to Brazil, she was president and managing director of GM Mexico—the first woman to serve in this

role. While in Mexico, Lieblein was also ranked second among the Top 50 Most Powerful Women in Mexico by Expansion Magazine. Today, she can leverage her experiences in Brazil and Mexico, two countries that play important roles in the General Motors supply chain.

GM has operated in Mexico for 78 years.

The company’s Mexico subsidiary is a vital part of GM’s North America Operations and has become one of the nation’s leading auto industry investors, producers and exporters in the nation’s history.

Ernesto Hernandez succeeded Lieblein as in 2011. He leads a market with an internal sales potential of 1.5 million cars, and continues to perform as one of GM’s top ten markets globally.

Global Investments and Growth Last June, the company announced the investment of $691 million for its Mexico operations, including a new factory in Silao in central Mexico to build eight-speed transmissions, and an upgrade to an existing factory in San Luis Potosi that will make nextgeneration transmissions.

Also last year, OnStar wholly owned subsidiary Motors Co. and General Mexico, announced the

Mexico, a of General Motors de service on

select vehicles in Mexico, offering safety, navigation and connectivity for drivers and passengers. This marked an important milestone in GM’s global growth as the company makes connectivity services available to more consumers around the world. The OnStar expansion in Mexico makes GM the preeminent provider of security and communications services in Latin America.

Today, GM is focused on innovation and customer-driven sustainability across all of its operations. The company relies on its suppliers to deliver technology in areas such as safety and fuel efficiency and it works around the world to build a solid supply base while encouraging environmental stewardship.

Much has changed since the new GM emerged in 2010. In early 2013, the automaker announced that by the end of 2016, General Motors will have redesigned, refreshed, or replaced most of its vehicle lineup. The outlook is positive as the company continues to experience increased brand awareness and sales across all of its brands. And its exciting lineup of cars and trucks, along with a new business model and energetic leaders, are making GM more competitive than ever and a company worthy of attention.

MEMBER HIGHLIGHTS / MIEMBRO DESTACADO

F

or more than 100 years, General Motors has played a pivotal role in the global auto industry. As the maker of iconic brands like Chevrolet, Buick, GMC and Cadillac, the company and its strategic operating partners produce cars and trucks in 35 countries around the world. At its inception, GM held only the Buick Motor Company, but in a matter of years they would acquire more than 20 companies including Oldsmobile, Cadillac, and Oakland, later known as Pontiac.

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MAY / MAYO EVENT

CHAPTER

PLACE

DATE

INFORMATION

THE WOODLANDS - GULF COAST CHAPTER

Medical World Americas Conf & Expo

April 28 - May 2

George R Brown convention Center (4/28-30) & Bioscience Research Center (5/1-2)

petegarcia@usmcocgc.org

NORTHEAST CHAPTER. NEW YORK, NY.

Cinco de Mayo Corporate Luncheon

5th

Vermilion Restaurant 480 Lexington Ave NYC

212 417 4702 events@usmcocne.org

CALIFORNIA PACIFIC CHAPTER. LOS ANGELES, CA.

Cinco de Mayo event and celebration cocktail

5th from: 7:00 p.m. - 1:00 a.m.

UNICI casa 9461Jefferson Blvd.

Culver City, CA 90232

310-922 0206 310-598 4188 marlen@usmcocca.org

Bajio Chapter - Leon Guanajuato

Integración de las Cadenas Productivas con la Reforma Hacendaria

8th

Hotel Hotsson

splopez88@gmail.com

NORTHEAST CHAPTER. NEW YORK, NY.

Real Estate Investment Summit

8th

The Princeton Club of NYC 15 West 43 Street, NYC

212 417 4702 events@usmcocne.org

MID-AMERICA CHAPTER. CHICAGO, IL

North american Trade Corridor

8th

Baker & McKEnzie

blanca.berthier@usmcoc.org

SOUTHWEST CHAPTER. DALLAS, TX.

Hispanic Political Trends

23-24 of May

Crowne Plaza

swusmx@netzero.com

CALIFORNIA PACIFIC CHAPTER. LOS ANGELES, CA.

Export Import Seminar Series in Conjunction with the Consulate of Mexico in Los Angeles. Coach Rigoberto Acosta confirmed.

May 27, 2014 from 6 pm -9 pm

2401 W 6th Street Los Ángeles, CA. 90057

310-922 0206 310-598 4188 marlen@usmcocca.org

Bajio Chapter - Leon Guanajuato

Realización de proyectos de eficiencia Energetica y auditorias ambientales

Continuo

León, Gto

JUNE / JUNIO EVENT

CHAPTER

PLACE

DATE

MID-AMERICA CHAPTER. CHICAGO, IL

Double Eagle Awards

June 4th

Drake Hotel

Guanajuato Chapter

Curso de Producción más Limpia y eficicncia Energética

13

León, Gto

NORTHEAST CHAPTER. NEW YORK, NY.

Mexico Business Investment Forum at NASDAQ

20th

NASDAQ MarketSite 4 Times Square NYC

CALIFORNIA PACIFIC CHAPTER. LOS ANGELES, CA.

Launching program ‘MIS RAICES” promoting Mexico D.F

24th

TBA

SOUTHWEST CHAPTER. DALLAS, TX.

Business Mission Trip

26th

DFW Airport

CALIFORNIA PACIFIC CHAPTER. LOS ANGELES, CA.

United Airlines Reception sponsored by the Mexico Tourism Board. Networking 6:00 -8:00 p.m.

26th from: 6:00p.m.8:00p.m.

TBA

CALIFORNIA PACIFIC CHAPTER. LOS ANGELES, CA.

Innovation Projects and Industrial Manufacturing in North Mexico

30th

TBA

Guanajuato Chapter

Realización de proyectos de eficiencia Energetica y auditorias ambientales

Continuo

León, Gto

INFORMATION blanca.berthier@usmcoc. org splopez88@gmail.com 212 417 4702 events@usmcocne.org 310-922 0206 / 310-598 4188 marlen@usmcocca.org swusmx@netzero.com 310-922 0206 / 310-598 4188 marlen@usmcocca.org 310-922 0206 310-598 4188 marlen@usmcocca.org splopez88@gmail.com

JULY / JULIO EVENT

UPCOMING EVENTS / PRÓXIMOS EVENTOS

CHAPTER

52

DATE

PLACE

INFORMATION

Guanajuato Chapter

Foro de Sustentabilidad y Responsabilidad social

23th

Hotel Radisson

splopez88@gmail.com

SOUTHWEST CHAPTER. DALLAS, TX.

International Business with San Luis Potosi

31st

DFW Airport

swusmx@netzero.com

Guanajuato Chapter

Realización de proyectos de eficiencia Energetica y auditorias ambientales

Continuo

León, Gto

splopez88@gmail.com

AUGUST / AGOSTO CHAPTER

EVENT

DATE

PLACE

INFORMATION

CALIFORNIA PACIFIC CHAPTER. LOS ANGELES, CA.

Seventh Celebration of the International Trade Community in Los Angeles

15-ago-14

TBD

310-922 0206 / 310-598 4188 marlen@usmcocca.org

CALIFORNIA PACIFIC CHAPTER. LOS ANGELES, CA.

Mexico and India. Two different worlds with great potential opportunities seminar and conference.

21-ago-14

TBD

310-922 0206 / 310-598 4188 marlen@usmcocca.org

CALIFORNIA PACIFIC CHAPTER. LOS ANGELES, CA.

Cross Border Seminar, Port of Los Angeles and Port and Ensenada Working Together, Signing and Agreement of Work and Cooperation.

29-ago-14

TBD

310-922 0206 / 310-598 4188 marlen@usmcocca.org

BI-NATIONAL EVENT

North American Sustainable Economic Development Summit

25-26 - ago-14

Four Seasons Hotel & Resort, Las Colinas-Irving, TX

gabriela@usmcoc.org

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