Nearshoring, the strategic practice of transferring business operations to nearby countries, has emerged as a transformative force within Mexico’s economic milieu.
The restructuring of supply chains and the infusion of foreign direct investment have propelled the nation’s industrial dynamics into a new era.
Yet, navigating this paradigm shift is not without its set of challenges. In this exploration, we delve into the hurdles shaping Mexico’s nearshoring landscape and the prospects it holds for the coming years.
Infrastructure Challenges in Nearshore Development
Within the realm of nearshoring in Mexico, one prominent challenge lies in the realm of infrastructure readiness.
Jonathan Pomerantz, Director of Business Development at Meor, underscores a pressing need for industrial space, estimated at a significant 13,000 million square meters, essential for fostering nearshoring growth.
Moreover, ensuring seamless connectivity through robust land, sea, and air ports becomes pivotal for facilitating efficient logistics and transportation of goods.
Uplifting Networks and Fiscal Incentives
Expanding infrastructure networks forms the bedrock of successful nearshore development in Mexico.
Recent fiscal incentives designed to bolster the export industry represent a significant stride forward.
Yet, further complementary measures are imperative. Streamlining permit processes, particularly those under the purview of the Energy Regulatory Commission (CRE), for both conventional and renewable energy generation, remains crucial.
Into the Future: Nearshore Forecast and Growth
The nearshore boom in Mexico manifests encouraging signs. According to the Mexican Association of Private Industrial Parks (AMPIP), approximately 63% of nearshoring projects originate from Asian economies such as China, South Korea, and Taiwan.
These developments forecast a robust future, anticipating the annual installation of nearly 227 new companies between 2023 and 2025.
Forecasts also predict substantial growth in real estate and logistics industrial spaces, estimating the creation of over 60 million square feet of fresh industrial terrain.
Notably, this expansion primarily targets Mexico’s northern border, foreseeing heightened demand stemming from increased foreign investments.
Business Opportunities in Mexico: The Nearshoring Boost
The evolving nearshoring scenario in Mexico represents a crucial opportunity for economic fortification and heightened global engagement.
However, strategic measures are indispensable to address infrastructural challenges, permit expediency, and reduce import dependencies.
Mexico is poised to cement its pivotal role in reshaping the global supply chain. Seizing this opportunity mandates tackling challenges proactively and leveraging inherent strengths.
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Source: Mexico Industry