Invest in Mexico
About AMEXCAP
AMEXCAP
The Mexican Association of Private Equity and Venture Capital Funds (AMEXCAP) is a non-profit association. The Association currently represents more than 100 PE, VC, Real Estate, Infrastructure and Energy funds that actively invest in Mexico, and more than 40 advisory services institutions.
Our mission
To promote the development of the Private Equity industry and of the Venture Capital ecosystem in Mexico.
Objectives
- To develop and strengthen relationships with institutional investor.
- To increase frequency and number of transactions.
- To improve the competitiveness of the capital industry by developing and maintaining constructive working relationships with authorities and regulators.
- To promote and disseminate the Private Equity and Venture Capital industries nationally and internationally.
- To generate statistical information and relevant studies of the Private Equity industry in Mexico.
Mexico as an investment opportunity
“The private equity industry in Mexico has raised a sum of more than US $61 billion in the last twenty years.”
MEXICO AT A GLANCE
2ND Largest economy in LATAM
15TH Largest economy in the world
9TH Place among exporters worldwide in 2019
1.26
Trillion USD in GDP 2019
8.5
Days to open a business
127M
Population
48
In WEF’s 2019 Competitiveness Index
13
Free Trade Agreements with 50 countries
33
Bilateral Investment Treaties
Why Invest in Mexico
Mexico is more than its stunning landscapes, excellent cuisine, and vibrant culture; it is a great investment destination.
Amid these turbulent times, there are a number of reasons that are worth considering when it comes to doing business and diversifying investment portfolios in Mexico this year.
These can be grouped into the following categories:
- A. Mexico’s internal strengths
- B. Recent developments on the international stage
A. MEXICO’S INTERNAL STRENGHTS
In 1986, Mexico signed the General Agreement on Tariffs and Trade (GATT), and since then it has signed several Free Trade Agreements with 50 countries. This has helped transform Mexico’s economy to become one of the world’s top export powers of today.
Access to the largest markets in the world
Mexico shares its northern border with the United States, the world’s largest market, which extends for a length of 3,141 kilometers (1,952 mi). This proximity, along with the Free Trade Agreement, help explain why Mexico sells to the US more than Japan, Germany and South Korea combined1, which amounted to $361 Billion USD in 2019.
Mexico is one of the largest economies (and with highest potential)
Mexico’s economy is placed 15th in the world, and 2nd largest in LATAM just after Brazil.
According to certain projections2, Mexico is set to become one of the 7 largest global economies by 2050, bigger than Germany and the UK, thanks to its strong manufacturing industry and extensive foreign trade.
Open economy
Mexico shines when it comes to international trade. It has signed 13 Free Trade Agreements covering 50 countries, which gives it access to more than 1 billion consumers throughout the world. In that sense, Mexico is an ideal export platform to access 60% of the world’s GDP.
Nowadays, Mexico exports more than all other LATAM combined, including Brazil. In 2019, Mexico sold $480 Billion USD worth of goods to the world, making it the 9th top exporter worldwide.
Modern economy
Over the last 15 years, Mexico has further developed its manufacturing base and as a result has become a leader in many different sectors, including tech.
- In 2018, Mexico became the fourth largest exporter of vehicles in the world in terms of value, just behind Germany, and Japan, and very close behind the United States.
- Mexico exports more than 78 USD billion in high-tech electronics to the world, including television screens, computers and telecommunications equipment, among others.
- Mexico is the largest exporter of two-door refrigerators with freezers in the world, the fifth largest exporter of computers, and the tenth largest exporter of mobile phones.
- In the medical device industry, Mexico is the largest exporter in Latin America and the largest supplier to the United States.
Top-tier human resources
Mexico has a highly trained and specialized workforce and boasts the 8th best record for engineers graduating per year domestically.3
Sound macroeconomic fundamentals
Mexico’s macroeconomic fundamentals are solid. In 2019, domestic inflation was less than 3%, and less than 3.15% in 2020. Also, the economic growth in the past 10 years has been 2.1% on average.
The Governor (Alejandro Díaz de León) of the well reputed Central Bank, an institution that oversees all of the macroeconomic variables of the country and whose independent body gives security to investors and the economy in general, was just recently awarded “Governor of the year” by Central Banking.
Infrastructure
Mexico is privileged with its geographical location and modern infrastructure. According to the WEF, Mexico is among the 30% of countries with the best transport infrastructure, with 172,000 km of roads, 27,000 km of railways, 117 ports, and 76 airports (64 international and 12 national).
B. RECENT DEVELOPMENTS IN THE INTERNATIONAL STAGE
There are at least three external reasons why it is wise to consider Mexico as a great investment destination in 2021, especially when compared with other emerging markets.
The USMCA
The US-Mexico-Canada Trade Agreement (USMCA), the replacement to the North American Free Trade Agreement (NAFTA), went into effect on July 1st, 2020. With this, the three countries are bringing their economic relations to the 21st Century.
The FTA now includes additional chapters that regulate trade in services (trade in goods was already tariff-free almost entirely) and other relevant trade disciplines, such as intellectual property.
The new chapter on digital trade contains the strongest provisions of any international agreement, supporting internet-enabled small businesses and e-commerce exports. For example, it prohibits customs duties on digital products distributed electronically (e-books, videos, music, software, games, etc.).6
USA-China competition
The technological and commercial war between the United States and China has opened a window of opportunity for Mexico because it is driving and facilitating both the relocation and attraction of industries and powering the growth of existing industries on Mexico’s soil. Goods that used to come from China can now be provided by Mexico. This policy towards China, started by the Trump’s administration, is set to continue during the Biden presidency.
In Mexico there are great opportunities to be discovered
and several big, global players are already taking advantage of the myriad of opportunities that Mexico presents.
Reshoring, nearshoring and Covid-19
According to UNCTAD7, Global Value Chains are changing to become even more regional and this will be accelerated due to the Covid-19 pandemic. This is where Mexico’s strategic location plays a key role.
Chinese companies are seeking to increase the quantity of automotive parts they make in Mexico. Auto parts manufacturers that have already established operations here are:
- Minth, which supplies Nissan, Ford, Honda, Mazda, Audi, Fiat Chrysler and General Motors.
- Hangzhou XZB Tech, which in 2019 opened a new factory in Nuevo León.
- Minghua started operations in San Luis Potosí, a supplier of a range of parts to Audi, Ford and General Motors.
Impro Precision, a Hong Kong-based manufacturer, announced in late 2020 that it is building a North American production based in the city of San Luis Potosí in central Mexico. Also, Taiwan-based electronics manufacturers Foxconn and Pegatron are among companies eyeing new factories in Mexico.
Recent investments have been announced in multiple sectors, such as the automotive, pharmaceutical, and aerospace.
BMW
USD 1 billion
Toyota USD 600 M
AB-InBev
USD 700 M
IKEA
USD 500 M
Hisense
USD 260 M
THE MEXICAN PE AND VC INDUSTRY
- In the last 20 years, the accumulated committed capital has reached more than USD $61.6 BN.
- That represents a compound annual growth rate of 12.7%, with a total of 550 funds that have fundraised.
- More than $35.5 billion (54% of the accumulated capital) has already been invested.
- Annual compound growth close to 15.6% (from December 2009 to September 2019).
- In 2019 at least USD 69 mill was raised, from which USD 30 mil belonged to VC.
- There are about 336 investment funds operating in Mexico, managed by 264 GPs (62% of them are Mexican).
- Startups with growth potential in the country represent USD $2.4 Billion per year. This figure is important because it signals the tremendous opportunity within the Mexican ecosystem.
Take a look at the 2021 Awards of the Private Equity industry in Mexico!
HUGE OPPORTUNITIES FOR FUTURE GROWTH OF THE INDUSTRY
The industry has reached a good level of maturity: from 284 GP’s that have operated in Mexico, 103 GPs have raised more than one investment vehicle (over a third of GPs), and from those who have a fund operating (266 GP’s), 94 GP’s have more than one fund.
The ongoing creation of a broad base of early-stage companies to receive financing from late-stage funds.
An increasing base of potential medium-sized companies with broad financing needs.
Implementation of Best Practices in management and standard businesses that improve the performance of a company boosting its competitiveness within the economy.
Remarkable position for Mexico to take advantage of the geopolitical rift. Noting that Mexico is a manufacturer leader and top exporter, it has a strategic geographic location to produce for the USA, China, and Europe.
Industry segments
Consumer Products
Transportation
Media
Real Estate
Healthcare
Fintech
Telecommunications
Infrastructure and Energy
Publications
Some of these documents are exclusively for AMEXCAP members and LPs. In case you are an LP and are interested in receiving them please contact us at info@amexcap.com
Exclusive for AMEXCAP members and LPs
Exclusive for AMEXCAP members and LPs
Exclusive for AMEXCAP members and LPs
Exclusive for AMEXCAP members and LPs
Exclusive for AMEXCAP members and LPs
Exclusive for AMEXCAP members and LPs
Exclusive for AMEXCAP members and LPs. For sale to the general public.
PE Overview 2019 Factsheet
Exclusive for AMEXCAP members and LPs
Exclusive for AMEXCAP members and LPs
Exclusive for AMEXCAP members and LPs
Exclusive for AMEXCAP members and LPs
Exclusive for AMEXCAP members and LPs
Meet our members
AMEXCAP has different kind of members:
Associates
Private Equity funds of different investment strategies (Venture Capital, Corporate Venture Capital, Growth, Private Debt, Real Estate & Infrastructure and Energy).
Affiliates
Service providers: financial, legal, tax advisory firms, etc., that provide specialized services to Private Equity fund managers in Mexico.
Investors
Institutional investors or companies that invest in Private Equity (included but not limited to: Fund of Funds, Family Offices, Institutional Investors, Pension Funds & Insurance Companies).
Yearbook
The AMEXCAP Yearbook is a document that collects the most relevant information of Private Equity firms, Investors, advisory partners, and professionals in Private Equity Industry in Mexico. This document is exclusively for AMEXCAP members and LPs. In case you are an LP and are interested in receiving the Yearbook please contact us at info@amexcap.com y/o lvidal@amexcap.com
Government and Regulatory agencies related to
the Private Equity industry in Mexico
the Private Equity industry in Mexico
Third Party Studies
Investor access
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