Benefits of Nearshoring Seen in Mexico

In Mexico, the positive impacts of the relocation of supply chains, also known as nearshoring, continue to materialize with benefits in the production, sales, and investment of companies in the country. However, it is important to address challenges related to strengthening the rule of law, according to the Bank of Mexico.

Alejandrina Salcedo Cisneros, General Director of Economic Research at Banxico, mentioned that the companies benefiting from this process increased to 12.9% from 9.3% at the national level.

This figure, she noted, reflects the percentage of manufacturing and non-manufacturing companies with more than 100 workers surveyed by Banxico, which reported an increase in their production, sales, or investment due to nearshoring from July 2023 to June 2024.

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"The benefits of relocation have been widespread across regions and sectors. (…) But it is a process that takes time," she emphasized during the presentation of the Report on Regional Economies, April-June 2024.

She also mentioned that when companies were asked about the period in which they expect to see the greatest benefit from relocation, 41.3% of them predict it will be between 2026 and 2030, while 31.6% expect it next year.

Alejandrina Salcedo highlighted that reinvestments (which grow faster than new investments according to Foreign Direct Investment data) can be seen as part of nearshoring, as these are companies already located in Mexico deciding to keep their profits in the country to increase investment.

She also pointed out that, based on the previous report, most of the companies benefiting from nearshoring are Mexican.

Nota originalmente publicada en El Heraldo de México