MEXICO & THE UK: A NEW ECONOMIC ERA
By Diego Gomez-Pickering*
As in 1825 when Mexico and the UK first established diplomatic relations, 2015, “The Year of Mexico in the UK” and “The Year of the UK in Mexico”, represents for both nations an extraordinary opportunity to take advantage of each other’s economic potential and to foster business to business interaction across the Atlantic Ocean.
Currently the UK is Mexico´s 5th biggest trading partner within the European Union and the 14th worldwide, while Mexico is the UK´s 2nd trading partner in Latin America. As Mexico’s diplomatic representative to the United Kingdom but also as honorary President of the Mexican Chamber of Commerce in the UK – the 1st and only Mexican Chamber in Europe - it is my duty to work towards strengthening our countries’ trade relations and to enable direct communication between British and Mexican businesses.
Our trade balance in 2013 was of approximately 5 billion USD, and we intend to increase it to 7 billion USD by 2015, as per the agreement between our Governments signed back in 2010. That said, there is plenty of room for even greater increases in the trade flux between Mexico and London and many areas of opportunity to explore. At high level meetings both countries agreed to concentrate on market share efforts rather than on quantitative indicators, and to work on increasing it from 0.6% to 1.5% in the midterm. We are confident we will achieve this goal but also keen on further expediting the bilateral trade rate growth. The UK’s economy is getting stronger in the aftermath of a long resilient global crisis and Mexico has managed to wind down the main implications that have hit other promising emerging economies.
It is not gratuitous that Jim O’Neil, the ex-Goldman Sachs economist who coined BRICs acronym is now including Mexico in the MINT group of countries as the next economic giants, along Indonesia, Nigeria and Turkey, predicting that Mexico´s GDP will reach USD $ 6.95 trillion by 2050, above most European countries. Nor it is that main bond credit rating corporations have recently improved Mexico’s grading’s, coincidentally with specialists’ opinions that the country could be among the ten largest economies of the world if the current path of transformations continues.
Since President Enrique Peña Nieto took office he has triggered the most ambitious package of social, political and economic reforms in Mexico’s recent history. Through the commitment shown by all main political forces represented in Congress and the scope of this transformative effort, expectations for “Mexico´s moment” are still running high. This series of structural reforms include key sectors such as telecommunication, labour, fiscal, banking, education, competitiveness, health, political, energy and transparency.
These changes, together with the consolidation of democratic institutions and the strengthening of the rule of law, are reinforcing Mexico as a relevant and dynamic player in today’s world.
Energy is only one of the many sectors that we identify as a magnet for British investment in Mexico but there are many more, such as the telecommunications and infrastructure sectors that, following this remarkable achievement, will certainly become attractive to businesses around the globe. Its network of 12 free trade agreements linking the country to 44 economies attests Mexico’s openness and commitment to free trade and its strategic partners, like the United Kingdom.
As we started 190 years ago, Mexico and the UK should continue paving their future as partners, friends and true allies.
*Ambassador of Mexico to the UK and Northern Ireland and honorary President of the Mexican Chamber of Commerce in the U.K.