Mexico's Booming Economy – What Investors Need to Know

By Richard Houghton & Sean O'Neal

Mexico's economy is on fire and now is the time to invest, if today's news headlines are any indication. Check out the impressive array of information below, which we have gleaned from a wide variety of stories written recently by some of the world's most respected financial institutions and reporting agencies. According to Goldman Sachs, Mexico's rapidly advancing infrastructure, increasing middle class and rapidly declining poverty rates will foster a higher GDP per capita than all but three European countries by the year 2050. This estimate might be conservative, when you consider that according to Forbes magazine Mexico's economy and GDP was already 11th in the world as of 2010, which Bloomberg, CNBC and Reuters all noted was a growth of 5.5 percent that year – the most in the last decade. Furthermore, NASDAQ has called Mexico “one of the world's largest developing economies,” pointing out that per capita the Mexican economy is already larger than those of China, India and Brazil. In addition, UK Trade & Investment has announced that it expects Mexico's economy to surpass the UK's by the year 2040, also pointing out that the UK is one of the largest investors in Mexico. A report by the Financial Times compared Mexico's current economic state to that of Spain 20 years ago, while IT exports from the country are expected to surpass $3.5 billion US in 2011 according to a report by Forbes Magazine. In addition, the European Union is working to improve its ties with Mexico by making it a “strategic partner,” while Honda has announced intentions to invest around $800 million according to a report by USA Today. Also of note, Bloomberg covered announcements from Nissan, General Motors, Mazda and Volkswagen to invest more than $400 million each in auto manufacturing facilities throughout Mexico. With all of this growth and international interest, it's no surprise that Bloomberg recently reported that Mexico has raised its forecast for foreign direct investment in 2011 to $20 billion US – a figure that is a full 11% higher than previous predictions. www.bajainvestment.com