It is impossible not to be fascinated by the history and the civilizations developed in Mexico: Olmecs, Toltecs, Teotihuacan, Zapotec, Maya, and Aztecs.
Mexico is a country of over 130 million people, 82% Catholic, with 41% of the population between the ages of 25 and 54 (53 million people), while those over 65 are only 7.67% (less than 10 million people).
Education spending is equal to 4.5% of GDP, which puts Mexico in 78th place worldwide; Italy is in 98th.
The Mexican economy is the 11th largest in the world.
Since 1994 Mexico is part of the North American Free Trade Agreement – now replaced by the USA-MEXICO-CANADA agreement (USMCA). In the last decades, it has increasingly oriented itself towards manufacturing, especially for the US market, becoming its third source import (and the third export).
Mexico is a country in many ways similar to Italy.
It is easy to feel at ease, with some necessary precautions, but with a much higher economic growth rate (and therefore opportunities) and an ideal geographical position.
But what are the 5 reasons to start a business in Mexico?
1. Market opportunity
Mexico is the third-largest exporter in the IT sector, the sixth largest supplier to the American aerospace industry, and the leading supplier of medical devices to the United States.
Given the Mexican market size, there is hardly any product that a company cannot successfully sell in Mexico, obviously at the right price and with good service.
The USMCA provides to manufacture 75% of a vehicle’s parts in one of the three countries (vs. the 62.5% of NAFTA, the North American Agreement for Free Trade) to remain duty-free.
And for the technology sector, many other benefits have been introduced in the new agreement between the three countries, previously absent in NAFTA.
2. Availability of Qualified Personnel
Over the past ten years, the number of graduates per year has gone from around 60,000 to over 114,000.
The proximity to the United States of America facilitates exchange programs between many universities.
For this reason, most workers who have completed a degree are partly bilingual.
Of course, social inequalities are still substantial and entail a significant fragmentation of education in the population.
Still, we must consider that Mexico is the second member country of the Organization for Economic Co-operation and Development (OECD), after Norway, to engage in a National Skills Development project.
3. Ease of opening a company
Unlike many other countries, such as China, where it is mandatory to have a local partner, in Mexico, the entrepreneur is free to carry out his business independently through his Mexican company, which can be incorporated with 100% foreign capital.
The initial share capital can also be meager (not to say negligible, even if it is not advisable). It can be increased at any time through a straightforward and cheap procedure.
The key point is the drafting of the Statute, which, in addition to defining the activity carried out, determines the relationships between shareholders, administrators, and attorneys.
The most common types of companies are the Sociedad de Responsabilidad Limitada (similar to the Italian S.r.l.) and the Sociedad Anónima (similar to the Italian S.p.a.).
4. Full Control of the Company
In Mexico, the Statute is very flexible and allows shareholders to tailor the company’s control to their needs.
The Shareholders’ Meeting represents the supreme decision-making body on which the Board of Directors depends.
The latter does not play a decisive role in corporate decisions.
Through the attribution of targeted proxies, the shareholders can precisely define the margins of action and the operational limits of the company’s legal representatives.
The latter, generally, are constituted by the local management to simplify many operations (think of the payment of the salaries, which in Mexico is weekly).
Through the powers of attorney, the shareholders effectively maintain complete control of the company.
The same thing happened for LENAM, which, in the face of proxies from its customers, negotiated and signed contracts on the spot independently (after sharing and approval of the Members, who remained in Italy).
5. An open culture
Unlike many other countries, where the feeling of being a “foreigner” is strong, in Mexico it is easy to feel at ease.
Attachment to family, love for food and parties (remember “la Quinta”), the ease of creating relationships and networks make everything much more enjoyable even when you are there for business reasons.
Contact us to find out more and to know our direct experiences and projects in Mexico.
Sources:
Central intelligence Agency – CIA.GOV
International Trade Administration – TRADE.GOV
Direct LENAM experience