Plan Mexico aims to attract investments derived from the New North American Economy (NEN), highlighted Marcelo Ebrard, Secretary of Economy.
On the one hand, Plan Mexico has an anti-cyclical component, to attract investments in industry, infrastructure and services.
On the other hand, it has a component to prepare Mexico to participate in the NEN.
New North American Economy
A report by the Joint Economic Committee of the U.S. Congress states that industrial policy involves the use of public resources to guide key sectors of the economy. To this end, governments apply subsidies, tax incentives, trade barriers and specific regulations. The objective is to advance economic, social or strategic goals.
This policy shift responds, in part, to the decline of manufacturing in several economies. It is also in response to social tensions stemming from the loss of industrial jobs. In addition, the Covid-19 pandemic exposed vulnerabilities in global supply chains.
At the same time, concerns about climate change, national security and China‘s economic rise are growing. The report indicates that these factors have accelerated the return of an active industrial policy in developed countries.
Against this backdrop, while participating in the National Meeting of BBVA Regional Advisors in Mexico City, Ebrard said that Mexico has opportunities to increase domestic content in the production of medicines, in the semiconductor production chain and in electronic products.
«When we say increase national content in all the sectors that I have just mentioned, and increase the capacity to attract investments that have to relocate, this is essentially what you are going to find in many of the points of Plan Mexico. It is not about increasing national content per se, but linked to this,» commented Ebrard.
FDI
President Claudia Sheinbaum presented Plan Mexico as a roadmap to transform the national economy. The central objective is clear: to turn Mexico into the tenth largest economy in the world by 2030.
One of the pillars of this strategy is to boost domestic consumption. It is projected that, by that year, 50% of the products consumed in the country will come from domestic production. This would reduce dependence on imports and, at the same time, strengthen local industry.
In addition, Ebrard affirmed that Mexico has the potential to double its Foreign Direct Investment (FDI) intake. According to him, this would be possible thanks to the impulse of the New North American Economy, based on integrated value chains and regional production.
“We call it NEN, the New North American Economy, because when you relocate such a large number of things, you change all the production and value chains, the skills: it is a very large redistribution,” said Ebrard.