Mexico As A FDI Destination. Analysis Of The Mexican Business Environment

Nowadays, there is a word that undoubtedly is in the mind of almost everybusiness man and student: Globalisation. Numerous explanations can be attributed to thedominance this word has in the commercial arena: the volatile development of global trade,international competition and change in technology. We have witnessed that the success ofa market generally goes to the firms best matched to their present environmentalconstraints. This process is having substantial influence on Mexico and China, two of thetop world emerging economies.With very different historical economical pasts, these emerging marketpowerhouses are leading the way with more than20%of the world‘s population and anannual GDP growth rate in the4%to8%range. In this work I will examine theenvironmental factors and the competitive advantage of Mexico, followed by determiningthe various modes of entry and finally the cultural and business practices in its economy.My thesis statement in this work is to prove that Mexico is, in fact, a very viableinvestment opportunity that has been under looked by Asian countries, such as China. Iwill present evidence to show the potential of this market and the value it has to firmschoosing to expand their markets beyond the common market places. Mexico can also beviewed as a hub and/or spring board to other major markets such as the U.S, Canada andLatin America.The body of this work will focus on identifying different key industries in whichthe Mexican economies thrives and have successfully catapulted its market into the globalarena. After identifying the key industries, I will conduct a SWOT analysis to determinethe factors that may attract possible investors to the country. In this SWOT analysis, thepossible weaknesses and threats of the economy will be researched, in order to provide awide and objective breakdown of the country. By giving a broad panorama of the Mexicanmarket, investing firms and companies can make an informed decision as to whether bringtheir capital or not into the country. My intention is to prove that the positive factors andopportunities outweigh the negative aspects and the threats to the market.Mexico presents a vast potential for overseas investment and is activelyencouraging the entrance of foreign players into the market. My argument is thatcompanies of any size wanting to be a world player cannot disregard this country for muchlonger.