Mexico is the second largest economy in Latin America and, despite adverse global market conditions, continues to bounce back strongly from the COVID-19 pandemic.
Mexico’s economy grew by three percent last year on the back of increased tourism and steady growth in auto exports. These are positive indicators for the growth of business opportunities in Mexico in 2023.
To gain a competitive advantage and make the most of these business opportunities, you need to understand the latest Mexican legal, accounting and tax compliance rules.
Let’s examine these factors and see why Mexico stands out as one of the best countries to do business this year.
Why is Mexico a good country to do business in?
Mexico is known as the gateway to Latin America and is known for its tourism, culture, cuisine and diversity. Its economy ranks 15th in the world by GDP, and 13th by purchasing power.
It has a growing population of over 126 million people and borders the world’s largest consumer market, the United States of America. In 2022, according to the World Bank, Mexico ranked 60th among 190 economies in ease of doing business.
Mexico currently has 13 free trade agreements with 50 countries, making it one of the most open and competitive markets in the world.
It also offers significant potential for capital investment, as it ranks 11th in the world in providing credit facilities to new international businesses. Furthermore, the country’s weaker currency provides greater purchasing power for your business opportunities in Mexico.
A pool of highly qualified talent awaits you in Mexico. Its workforce ranked ninth best among more than 60 countries in ManpowerGroup’s overall workforce index. It assesses countries’ workforces on more than 200 unique factors grouped under the categories of accessibility, cost-effectiveness, regulation and productivity.
Mexican Economy Minister Raquel Buenrosotro announced in November that “More than 400 North American companies intend to relocate from Asia to Mexico“.
The Mexican government is focused on improving the country’s infrastructure, including telecommunications, energy and transportation.
In general, the government is receptive to foreign investment, offering tax breaks, research and development incentives, and duty deferral programs. All these factors make Mexico an attractive place to do business in 2023.
Top Industries for Business Opportunities in Mexico
Mexico has become a prominent manufacturing economy, specializing in the production of a number of significant exports such as electronics, petroleum, and agricultural products.
However, at the top of the manufacturing market, Mexico has business opportunities in these five areas.
1 – Fintech
Mexico’s fintech market has seen significant growth in recent years. It is expected to increase in 2023 with the increase in mobile device transactions.
With the country’s growing adoption of technology, digital financial tools such as mobile wallets and contactless payments are likely to continue to thrive in Mexico. The 2022 Latam Tech Report predicted that cash use in Mexico would drop 38 percent by the end of 2024.
Investors can find a number of encouraging Mexico business opportunities in the financial technology sector.
2 – Tourism
Tourism is an important industry in Mexico, currently accounting for eight percent of Mexico’s GDP. In January-November 2022, 58 million international visitors entered the country, whose average spending increased by 38 percent.
Mexico has one of the fastest growing tourism industries in the world. According to the latest Economic Impact Report (EIR), more than 2.7 million new jobs will be created over the next ten years.
3 – e-commerce
The Covid-19 pandemic has dramatically accelerated the adoption of e-commerce in Mexico. It is projected to grow by more than 16 percent annually by 2027 with more than 88 million users.
New markets are emerging, while established markets have the potential to grow even further. The Mexican e-commerce market offers significant business opportunities in 2023.
4 – Pharmaceutical
Mexico has the second largest pharmaceutical market in Latin America after Brazil and ranks 15th in the world. By 2025, it is projected to grow to USD 30 billion.
It is home to a powerful manufacturing industry for antibiotics, painkillers and antiparasitics. In addition, the local market tends to favor branded products over generics, making it an ideal location for licensing innovative drugs.
5 – Automotive
Experts predict that Mexico could become the world’s third largest producer of auto parts. Auto parts production in Mexico reached a new record of US$107 billion last year, reflecting a 12.6 percent increase over the previous year.
As convergence activity continues to increase, the future looks bright for Mexico’s automotive industry in 2023 and beyond.
What is the economic outlook for business opportunities in Mexico?
Mexico’s economy continues to weather the global recession with positive numbers in 2023. The International Monetary Fund (IMF) raised its 2023 GDP growth forecast for Mexico in January.
Its strong automotive, agriculture and tourism sectors have helped it stay afloat with the growth of the nearshore sector. Despite rising inflation, Mexico’s 7.9 percent rate puts it in a better position than other Latin American countries such as Colombia, Chile and Peru.
Now is a great time to invest in Mexico business opportunities before the market becomes oversaturated.
Biz Latin Hub can help grow your business
If you are thinking of doing business in Mexico, Biz Latin Hub is the ideal partner for you.
We have a team of bilingual corporate support professionals based in Mexico who can offer you personalized service. These services include company formation, accounting and taxation, legal support, recruiting and PEO.
Our experts are ready to help you do business not only in Mexico, but also in the rest of Latin America. To learn more about our services and how we can help you succeed, contact our team of professionals today.