Foreign investment in Mexico falls during the first quarter without a boost from F&A

Foreign direct investment (FDI) received by Mexico in the first quarter of 2023 amounted to US$ 18,636 million, the Ministry of Economy (SE) reported on Sunday.

The amount received was 4.1% less than what was registered in the first three months of 2022, when the entry of US$ 19,427 million was registered.

However, the Mexican agency explained that this investment flow is 48% higher if the extraordinary amounts due to the Televisa-Univisión merger and the restructuring of the Aeroméxico company are not considered.

Preliminary data from the agency indicate that without these operations for more than US$ 6,000 million, FDI in the period January-March 2022 was US$ 12,553 million.

FDI in the first quarter of the year came from 1,387 Mexican companies with foreign capital participation and 863 trust agreements.

90% of this foreign investment, equivalent to more than US$16 billion, was part of a reinvestment of profits, while 5% corresponded to new investments and another 5% to loans and payments between companies of the same corporate group.

“The behavior observed in the first quarter of 2023 represents the confidence of investors to maintain and expand their investments in the country.”, celebrated the SE in its report.

In these first three months, the United States confirmed itself as Mexico’s main trading partner, leading the capital injected into the country, followed by Spain, Argentina, the Netherlands, Germany, Canada, the United Kingdom, Switzerland, Japan, and Brazil.

Meanwhile, the Ministry of Economy reported that 67% of the FDI received in this period was located in five Mexican entities, with Mexico City being the one with the highest capture, with 38% of total investments, equivalent to US$ 7,039. millions.

Behind this was Nuevo Léon, in the north of the country, with US$ 2,332 million, 13% of the total; followed by the state of Jalisco, in the Mexican Bajío, with US$ 1,079 million, 6% of all registered investment.

There were also entities such as Puebla and the State of Mexico, with US$920 million and US$892 million, respectively.

By sectors, the SE detailed that 53% of the FDI received in the first quarter corresponded to Mexican manufacturing.

By subsectors, investments made in transportation equipment, the chemical industry, the food industry, computer equipment, electric power generation equipment, metals, the beverage and tobacco industry stood out.

Another 33% were related to financial services, 4% to transport, mail and storage, and 2% to mining, construction, retail and wholesale trade, respectively.

Source: EFE