Nearshoring Boost Expected for Mexican Border States as Companies Eye Investments
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Mexican businesses expect nearshoring to boost economic growth, especially near the U.S. border. The government expects nearshoring to add up to 1.2 percentage points to 3.5% GDP growth this year.
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Multinationals are already planning investments in Mexico for nearshoring in manufacturing, especially auto, electronics, and machinery sectors.
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Tesla's reported $5 billion factory has attracted $1 billion in Chinese investments to nearby industries. Gross fixed investment is seeing its strongest growth since 1997.
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Industrial real estate demand is estimated to grow nearly 80% in 2023/24. However, energy and infrastructure limitations could curb growth.
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Cement and construction companies are seeing demand growth already, especially in northern border states like Chihuahua. Total construction output jumped 46% in August 2022.