Mexico‘s industrial parks have increased their occupancy levels as a result of nearshoring, according to the Ministry of Finance.
According to the Mexican government, the unprecedented business climate will boost private investment in Mexico due to the phenomenon of relocation of operations to regions close to the target market (nearshoring).
The Inter-American Development Bank (IDB) estimates that Mexico’s short and medium-term potential gain from nearshoring is US$35 billion, equivalent to 2.6% of GDP derived from new merchandise exports.
In 2022, the Inter-American Development Bank (IDB) announced a credit line of $200 million, accompanied by $3 million in non-reimbursable resources. These funds will be distributed through development banks to support the relocation of companies, with a focus on fostering growth in southeastern Mexico.
Additionally, IDB Invest plans to provide between $1.8 billion and $2.8 billion in private financing. This funding aims to attract companies interested in relocating operations to the Isthmus of Tehuantepec, further driving regional economic development.
Industrial Parks
The Ministry of Finance believes Mexico is well-positioned to strengthen its role as a leading exporter. This growth is expected to boost employment in the country’s manufacturing and logistics sectors.
Nearshoring opportunities are already evident. In 2022, demand for industrial parks increased by 42% compared to the previous year. Additionally, 4.7 million square meters of industrial space were constructed, which is double the amount from the prior year.
In addition, the share of some Mexican manufactures in U.S. imports has increased from 2019 to 2022, such as cars and trucks (2.8 percentage points), bodies and trailers (11.3 percentage points), metal structures and ironwork products (4.6 percentage points), among others.
Outlook
External factors are set to influence industrial production in the United States through 2023. Reduced distortions in global value chains, which have impacted performance since 2020, are expected to improve inventory replenishment. This change will enhance the availability of inputs and products for global distribution.
Additionally, the reshoring trend—bringing production processes back to the United States from regions like Asia—will continue. This shift is projected to boost employment and manufacturing activity, especially in regions with strong commercial ties to Mexico.
In the case of Texas, the main trading partner, it generated 34,100 new manufacturing jobs between January and July 2022, around triple the number of jobs created in the same period of the previous year, reaching its highest level in July 2022 since November 2008.