9/04/2024
Announcements of the expected construction of new industrial buildings in Mexico for the upcoming years signal the early stage at which the nearshoring trend to Mexico is developing.
According to El Economista journal, analysts from various financial organizations, including BNP Paribas and Monex, view these announcements of new industrial development as evidence of the emerging process of nearshoring and enterprise relocation in the country.
Since the past year, a noticeable increase in investment in infrastructure and facilities construction has been observed, as stated by BNP Paribas economist Pamela Diaz Loubet.
The Mexican National Institute for Statistics and Geography registered a 22.6% annual growth in investment for developing new industrial facilities, which experts consider an essential sign of the future boost in attracting foreign enterprises and industrial activities due to nearshoring dynamics.
“Manufacturing relocation will take several more years. We are indeed witnessing a very early stage, and while this may reflect in the country’s Gross Domestic Product, it will be on a much longer horizon than one year” explained Janneth Quiroz, Director of Economic, Foreign Exchange, and Stock Market Analysis at Monex Financial Group.
New industrial parks: a sign of growth in nearshoring activities to Mexico
The Mexican Association of Private Industrial Parks announced in December that it has important records of industrial building constructions, expecting an additional space coverage of 6 million square meters by 2027.
Analysts believe that this enhancement in building construction will reflect in the Mexican Gross Domestic Product growth in the upcoming years, in a landscape in which the risk management and qualification firm Fitch Ratings expects an increase of around 2%.
To attract more foreign enterprises, Mexico must address challenges and improve conditions for their development.
The main challenges for establishing Mexico as a nearshoring activity hub
- Improving infrastructure and connectivity.
- Ensuring a robust legal framework.
- Guaranteeing stable supplies of energy and water.
- Maintaining competitive labor costs compared to other countries worldwide.
Frontier Industrial provides industrial land for sale and buildings for rent in Mexico's key industrial regions. We ensure the availability of water, energy, and resources essential for precise industrial operations. If your company is considering establishing operations in Mexico, contact us to learn how we can assist in developing your project.
