GENERAL SITUATION IN MEXICO
Weekly Review I May 15, 2024
RELEVANT NEWS INDUSTRIES
SEMICONDUCTORS
The Baja California State Government will train 100 teachers to meet the needs of the semiconductor industry and transform Baja California into the most important value center in Mexico.
Participants will receive scholarships as they train to become the specialized workforce to support investment in the strategic semiconductor industry.
The economic support they will receive is provided by Santander Universities and in collaboration with the Emtech Institute, informed Kurt Ignacio Honold Morales, head of the Ministry of Economy and Innovation.
SOURCE: EL UNIVERSAL
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RELEVANT NEWS INDUSTRIES
AUTOMOTIVE:
The recovery in domestic and international demand has allowed the Mexican automotive industry to maintain a good growth rate in the production and export of new cars.
According to the monthly report of the National Institute of Statistics and Geography (Inegi), brands such as Volkswagen, Honda, Ford and General Motors were the ones that drove the increase in production, achieving increases ranging from 23% to 40%.
The report details that in April, car assembly in Mexico was the highest in history for a similar month, as a total of 358,575 units were registered, which represents an increase of 21.7% when compared to the 294,550 cars in April 2023, in addition to being 18% higher than the levels reached in 2019 before the health crisis.
According to the Mexican Automotive Industry Association (AMIA), assembly plants are already operating at more than 89.2% of their installed capacity.
In the case of car exports, mainly to the United States, Inegi reported a total of 289,756 cars, a figure that also represents an increase of 14.4%, in addition to being the highest volume of foreign sales in history for April.
SOURCE: EXCELSIOR
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NEWS BY STATE
BAJA CALIFORNIA
Taiwanese companies meet with Baja California officials. The Ministry of Economy and Innovation of Baja California met with representatives of the Taiwanese electronics industry to explore opportunities for the production of components for zero-emission vehicles in Mexico.
SOURCE: EL ECONOMISTA
SONORA
Due to the power outages registered in Hermosillo last Tuesday, civil organizations and businessmen expressed their fears about these supply failures due to the damages that could be generated. Jesus Gámez Garcia, president of the Maquiladora and Export Manufacturing Industry (Index) Sonora, and Genaro Vecerra Álvarez, executive director of the same organization in Nogales, agreed that it is necessary for the CFE to take the necessary measures to prevent this from happening.
SOURCE: EL IMPARCIAL
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NEWS BY STATE
CBRE’s first quarter report on the industrial real estate market indicates that the outlook for this year is positive, albeit with more moderate growth compared to the previous two years. Industrial demand remains very active, but decision making has slowed due to the upcoming elections in Mexico and the United States.
Nevertheless, CBRE believes that there will be a new phase of nearshoring due to the expansion of companies that arrived in Monterrey during the first years of this phenomenon, the continuous announcements of investments for the electromobility sector and the expansion of the logistics sector, which will continue to drive industrial demand in 2024.
SOURCE: EL ECONOMISTA
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NUEVO LEON
NEWS BY STATE
TAMAULIPAS
The maquiladora export association (index) in Nuevo Laredo, Tamaulipas, met with U.S. Consul Cristina Hardway to strengthen binational collaboration schemes and highlight economic development opportunities. Enrique Moran, president of Index Nuevo Laredo, expressed interest in developing joint work schemes to attract cross-border investments. The association generates 36,000 direct jobs through 33 affiliated manufacturing companies in sectors like automotive, electrical, electronics, and medical.
SOURCE: MEXICO INDUSTRY
CHIHUAHUA
In a joint effort to strengthen the semiconductor industry in Chihuahua, the University of Guadalajara (UdeG) and Arizona State University (ASU), in collaboration with the state government, announced the official launch of the English Course for the Semiconductor Industry. This Monday, in a presentation session, they detailed the scope and objectives of this initiative, which aims to train young people from Chihuahua, thus ensuring a highly qualified workforce adapted to the needs of the market in this important technological sector.
SOURCE: MEXICO INDUSTRY
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NEWS BY STATE
SAN LUIS POTOSI
The WTC III Industrial Park in San Luis Potosi is set to consolidate in the first half of 2024, according to Michelle Porrino, CEO of the project. The industrial park, located in the northeast end of the San Luis Potosi metropolitan area, will host logistics services companies. One of the first companies to be installed will be a regional distribution center of a department store chain. The project covers 93.8 hectares and is expected to install at least four other companies with similar operations in 2024. The WTC 3 project aims to build a logistics park for companies providing equipment and services to industry and regional commerce.
SOURCE: MEXICO INDUSTRY
GUANAJUATO
Power outages affect industry in Guanajuato; businessmen warn of losses. The former president of Canacintra in Leon, Rene Solano Urban, warned about economic losses derived from the blackouts. He pointed out that there are industries that have to restart equipment or production processes due to minimal interruptions. The businessman also pointed out that the private sector should invest in clean energy production.
SOURCE: PERIODICO CORREO
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NEWS BY STATE
QUERETARO
Based on records of the Ministry of Economy, from January to April 15, Queretaro concentrated investment announcements for 5.783 billion dollars, leading the list of entities with the most investment announcements. During this year, 24 investment projects have been finalized for the state, according to the Secretariat of Sustainable Development (Sedesu). These investments include projects for the automotive industry, aerospace, manufacturing, services and information technologies, according to the Secretary of Sedesu, Marco Antonio Del Prete Tercero.
SOURCE: EL ECONOMISTA
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NEWS BY STATE
CDMX
The Department of Labor and Employment Promotion of Mexico City reported that, during the month of April, Mexico City saw the creation of 23,238 formal jobs registered with the Mexican Social Security Institute (IMSS), positioning the capital as the entity with the highest job creation in the country. As of the end of April 2024, the total number of formal jobs registered with the IMSS in the city reached 3,490,972, making it the entity with the highest number of jobs. According to IMSS records, all nine economic sectors showed positive balances in monthly job creation. The breakdown of formal jobs generated during this period is as follows:
• Business, personal, and household services: 10,551 jobs,
• Construction industry: 3,943 jobs,
• Transportation and communications: 2,606 jobs,
• Social and community services: 2,452 jobs,
• Manufacturing industry: 1,924 jobs,
• Commerce: 1,114 jobs,
• Extractive industry: 298 jobs,
• Agriculture, livestock, forestry, fishing, and hunting: 249 jobs,
• Electric industry, water supply, and sanitation: 101 jobs.
SOURCE: LA JORNADA
STATE OF MEXICO
The CCE highlighted the current importance of the national economy, advocating for investments in clean energy, fiber optics, and airport improvements to foster sustainable economic growth. Additionally, it underscored the State of Mexico’s favorable conditions as a major consumer market and economic contributor. Governor Delfina Gomez emphasized collaborative efforts between the government and private sector to address social inequalities and promote economic growth in the state.
SOURCE: EL SOL DE TOLUCA
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INVESTMENT NEWS
CENTRAL MEXICO
TYASA
The steel company announced the investment of 250 million dollars for rolling mill plant in Orizaba, Veracruz. The projects aims to create 1,500 jobs when it begins operations in 2025.
MICRON TECHNOLOGY
The Taiwanese automotive company announced the expansion of its operation in Pedro Escobedo, Queretaro with a 10 million dollars investment and the creation of 140 jobs.
LEMTECH
The semiconductor manufacturer announced a new engineering center as part of its global expansion in Guadalajara, Jalisco. No investment and jobs details shared.
NORTH GKN
The British aerospace company opened a new facility in Chihuahua City with a 30 million dollars investment and the creation of 300 jobs.
EQMS
The Austrian casting equipment manufacturing announced the investment of 30 million dollars in Coahuila. The project aims to create 400 jobs. No location details shared.
NATIONAL
GERDEAU
The Brazilian steel company has announced the intention to build a new facility in Mexico. The estimated investment of 600 million dollars. No location and jobs details shared.
SOURCES: NEWSWEEK ESPANOL, MEXICO NOW, MEXICO INDUSTRY, CLUSTER INDUSTRIAL
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LEGISLATIVE CHANGES AND INITIATIVES
LABOR
• Tabasco: Initiative To Issue The Law For The Promotion Of First Employment For The State Of Tabasco
Presented by: Local Deputy Juan Jose Graham Nieto (Tab - PVEM)
Purpose: The proposed law aims to define training services for improving skills in companies and fostering entrepreneurship among young individuals. It seeks to promote the creation of new job opportunities for youth and establish connections between universities, the public, and private sectors to facilitate their entry into formal employment. Additionally, it emphasizes the importance of training and specialization for the professional growth of young workers. The law also introduces a First Employment Promotion Program with incentives for companies hiring young workers and newly established companies led by youth, including economic and fiscal benefits and exemptions in procedures to encourage productivity and employment in the State.
Status: 2024-05-08 - Initiative referred to the Committee on Municipal Strengthening and Labor for consideration.
• Nuevo Leon: Citizen Initiative That Amends Various Articles Of The Law On Sustainable Mobility, Accessibility, And Road Safety For The State Of Nuevo Leon
Presented by: State Congress of Nuevo Leon
Purpose: For companies with a minimum of 100 employees, it will be mandatory for them to provide employee transportation.
Status: 2024-05-06 - Initiative referred to Committee on Mobility for consideration.
• Nuevo Leon: Initiative To Amend Article 160 Of The State Of Nuevo Leon’s Tax Law
Presented by: Dip Loc. Alhinna Berenice Vargas Garcia (NL - PRI)
Purpose: To incentivize employment by exempting payroll tax payments for:
Remuneration of individuals aged 60 or older for up to 200 quotas.
Remuneration of young people aged 18 to 29 during their first year of employment.
Status: 2024-05-06 - Initiative referred to State Finance Committee for consideration.
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LEGISLATIVE CHANGES AND INITIATIVES
ENVIRONMENTAL
• Nuevo Leon: Citizen Initiative Adding Article 136 Bis To The Environmental Law Of The State Of Nuevo Leon
Presented by: State Congress of Nuevo Leon
Purpose: In order to reduce atmospheric pollution, the State Government will allocate 3% of the annual budget to subsidies for anti-pollution technology for public and private companies. Preference will be given in resource allocation to those companies identified as the main emitters of pollutants in the state according to the Emissions and Pollutant Transfer Registry, provided that at least half of the days in the previous year exceeded the pollution limits established by Mexican official regulations.
Status: 2024-05-10 - Initiative referred to Committee on Environment and Sustainable Development.
WATER
• Mexico City: Initiative With A Draft Decree To Amend And Add Various Provisions Of The Law On The Right To Access, Provision, And Sanitation Of Water In Mexico City
Presented by: Local Deputy Javier Ramos Franco (CDMX - PVEM)
Purpose: Installing systems for the collection and reuse of rainwater in all public and private buildings, commercial establishments, and residential homes in Mexico City.
Status: 2024-05-09 - Initiative referred to Committee on Integrated Water Management for consideration.
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LEGISLATIVE CHANGES AND INITIATIVES
• Mexico City: Initiative To Amend Articles 4 And 62 Of The Law On The Right To Access, Provision, And Sanitation Of Water In Mexico City Regarding Hydraulic Feasibility
Presented by: Local Deputy Luisa Adriana Gutierrez Ureña (CDMX - PAN)
Purpose:The Water System will assess the feasibility of providing hydraulic services based on factors like water availability and existing infrastructure. Interested parties can apply for water service feasibility through a Digital Platform, paying fees. If the system denies feasibility for new developments or modifications, applicants can still apply if they commit to using water-saving technologies, with the declaration of feasibility lasting two years.
Status: 2024-05-07 - Initiative referred to Committee on Integrated Water Management for consideration.
• Mexico City: Report Amending And Adding Various Articles Of The Political Constitution Of Mexico City Regarding The Use, Utilization, And Distribution Of Water
Presented by: Committees on Constitutional Points and Citizen Initiatives; and on Integrated Water Management
Purpose: The water policy will ensure a public policy for rainwater harvesting, utilization, and treatment of gray and wastewater, as well as the sustainable exploitation of aquifers.
Economic activities shall not compromise the satisfaction of personal and domestic water use needs under any circumstances. The efficient, responsible, and sustainable use of water in economic activities will be promoted, and the establishment of industries and services with high consumption will be regulated. They will be obligated to guarantee efficient, responsible, sustainable, and equitable water use by implementing and operating infrastructure for rainwater harvesting and wastewater treatment to supply services not considered vital basic access for citizens.
Status: 2024-05-14 - Approved, forwarded to the Executive Power of the Mexico City.
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LEGISLATIVE CHANGES AND INITIATIVES
COMPETITION
THE FEDERAL ECONOMIC COMPETITION COMMISSION (COFECE) PUBLISHED ITS FIRST QUARTERLY REPORT 2024. THE FOLLOWING POINTS ARE HIGHLIGHTED IN THE REPORT:
The new stage of competition policy will focus on three main axes:
• Social vision to focus investigations on markets that impact the most disadvantaged households.
• Promotion of entrepreneurship and investment to establish fair conditions that allow SMEs to enter any market.
• Elimination of artificial barriers to labor mobility.
The report covers five chapters, focusing on various aspects of competition policy. It highlights efforts in:
• Preventing and correcting market structures that impede competition, particularly noting the absence of effective competition in the retail e-commerce market.
• Combating anticompetitive practices, with two legal proceedings initiated against potential monopolistic practices in leasing non-residential real estate spaces and maritime transportation services.
• Promoting and disseminating the principles and benefits of economic competition, including opposing measures that could harm competition in the casting, iron, or steel manufacturing sector nationwide.
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