Luis Amazio (Director of the Department of Economics of Mexico)

30.07.10 - Interview conducted by Jill Prigge

Q1. When you look at corporations of Mexico there is a partnership. What unique role do companies have in promoting Mexico abroad?

With companies promoting Mexico, it is hard to tell. Mexico is also in coordination with the Chamber of Commerce in Mexico, with different states and different industries. But we have very strong regional commerce due to good relations with regional chambers. We try to attain information from them and let them know that you are a company but we need to tell the world, what we are looking for what kind of joint ventures foreigners are looking for. So then, we, as a government, support a campaign and try to let everybody know the need for Mexican companies.

Q2. How do you tie in the wants and needs of the corporations and still represent the product Ė Mexico?

Mexico is divided in itself to six or seven categories by sector and then we have the agricultural ministry and we use that we promotion organisms so obviously we divide between these two or three different ministries or sectors. Obviously it depends on the size of the companies. If we have a small company, it will not move a lot of money, if we have a medium sized company it will export maybe to South America, Central America or the US and you know thatís the capacity of the company. So what we do is we analyse it, we share our campaign ideas.

Q3. There is an odd dichotomy in Mexico, with both privatized and state run companies. How can you protect the best interests of Mexico?

We offer a lot for investments and itís not that they donít hold titles, they share these titles. When a company comes, we do try and analyse with side companies what the project is and what kind of program it is. If we ask them to bring technology, and engineers for example, they will help in the development of the Mexican economy.

Q4.How can that specifically better Mexico? Mexicoís voice is being heard in that interchange abroad, because itís foreign direct investment in Mexico?

We really ask the companies who have had good experiences and also bad experiences to make it better for everybody. Every seminar we organise, every international conference, we always have such interesting stories. We have representatives of companies to be there and explain to us how there experience have been and what did they learn from it. When you go and see Siemenís for example which has been in Mexico for many years, they have had some problems. But in the overall analysis, they are happy with their operations in Mexico. We are trying to move from manufacturing to a highly skilled technology manufacturing which is environmentally friendly.

Q5. What are the challenges associated with attracting Foreign Direct Investment to Mexico, while still being predominantly regarded as simply a tourist destination?

The first thing is to inform people and change misperceptions. This is one of the biggest struggles we have in terms of attracting FDI to Mexico. President Calderon has implemented a strategy alongside the Mexican embassies and the international media to change these perceptions. We try to combine cultural heritage, which is very important to the country of Mexico, with ProMexico initiatives. We tried with media, interviews, more expositions, and by combining touristic and cultural events with economic events, and again this is part of the first step which is translating that information. Secondly, we also have local problems such as the drug cartel wars which not only has economic impacts, but also affects the entire social network of Mexico.

Q6. How has the recent oil spill in the Gulf Of Mexico affected Foreign Direct Investment?

In terms of companies who have operations in Mexico, or potential investors, they have not cancelled their trips to Mexico, but have simply postponed them. For example there were meetings scheduled for February and March, but they will now take place in September and October. In terms of losing investment to other countries where there is cheap labor readily available, you run into quality issues. You can move your operations where itís cheaper in places like Vietnam or Eastern Europe and quality has been an issue. When you combine level of quality and cost Mexico still has a comparative advantage.