Reaching markets abroad: Mexican companies not hemmed in by borders.A Google search Google is owned by Google, Inc. whose mission statement is to "organize the world's information and make it universally accessible and useful". The largest search engine on the web, Google receives several hundred million queries each day through its various services. using the key words "Mexico," "economy" and "exports" will produce a page on the Wikipedia website entitled "Economy of Mexico." Here you can read the following: "Mexico has a free market economy with a mixture of modern and out-moded industry and agriculture, increasingly dominated by the private sector .... Mexico is highly dependent on exports to the U.S., which account for almost a quarter of the country's GDP GDP (guanosine diphosphate): see guanine. ." While this is all true in the broadest of terms, it hardly tells the real story. Mexico's entry into the battle of economic globalization globalization Process by which the experience of everyday life, marked by the diffusion of commodities and ideas, is becoming standardized around the world. Factors that have contributed to globalization include increasingly sophisticated communications and transportation can be traced back to the mid-1980s. First President Miguel de la Madrid (1982-1988), then President Carlos Salinas de Gortari Salinas de Gortari can refer to:
[ILLUSTRATION OMITTED] Initially, Mexico relied upon cheap labor and its proximity to the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. as a comparative advantage. State-owned companies fell from more than 1,000 in 1982 to fewer than 200 in just over 15 years, boosting private sector involvement in key industries. The policy of privatization privatization: see nationalization. privatization Transfer of government services or assets to the private sector. State-owned assets may be sold to private owners, or statutory restrictions on competition between privately and publicly owned has continued, and President Ernesto Zedillo (1994-2000) made an effort to expand competition in seaports This is a list of the world's seaports: Atlantic Ocean
The much-heralded North American Free Trade Agreement North American Free Trade Agreement (NAFTA), accord establishing a free-trade zone in North America; it was signed in 1992 by Canada, Mexico, and the United States and took effect on Jan. 1, 1994. (Nafta) was initiated in 1994, producing a burst of trade, a spike in incomes and providing Mexico with a safe haven 1. Designated area(s) to which noncombatants of the United States Government's responsibility and commercial vehicles and materiel may be evacuated during a domestic or other valid emergency. 2. from the cyclical economic woes that have long plagued Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. . Nafta and a strong export sector were instrumental in softening Mexico's 1994-95 crisis caused by a botched botch tr.v. botched, botch·ing, botch·es 1. To ruin through clumsiness. 2. To make or perform clumsily; bungle. 3. To repair or mend clumsily. n. 1. peso devaluation devaluation, decreasing the value of one nation's currency relative to gold or the currencies of other nations. It is usually undertaken as a means of correcting a deficit in the balance of payments. . [ILLUSTRATION OMITTED] Granted, there have been plenty of bumps in the road. While there can be no doubt that trade liberalization lib·er·al·ize v. lib·er·al·ized, lib·er·al·iz·ing, lib·er·al·iz·es v.tr. To make liberal or more liberal: "Our standards of private conduct have been greatly liberalized . . . has helped generate unprecedented opportunities, it has also led to economic dislocation and the marginalization mar·gin·al·ize tr.v. mar·gin·al·ized, mar·gin·al·iz·ing, mar·gin·al·iz·es To relegate or confine to a lower or outer limit or edge, as of social standing. of thousands. Dozens of companies have been shuttered shut·ter n. 1. One that shuts, as: a. A hinged cover or screen for a window, usually fitted with louvers. b. in the face of foreign competition, and a poor education system limits the ability of millions to profit from free trade. Sound Fundamentals But since the last economic crisis ended 10 years ago, Mexico's macroeconomic mac·ro·ec·o·nom·ics n. (used with a sing. verb) The study of the overall aspects and workings of a national economy, such as income, output, and the interrelationship among diverse economic sectors. fundamentals have strengthened. Ratings agencies have extended investment-grade status to Mexico's sovereign debt. The government has taken steps to lessen the country's dependence on the United States (the downturn in the U.S. economy in 2001 is blamed for Mexico's poor performance from 2001 to 2003). Free trade agreements have been signed with the European Union European Union (EU), name given since the ratification (Nov., 1993) of the Treaty of European Union, or Maastricht Treaty, to the European Community , Central American Central America A region of southern North America extending from the southern border of Mexico to the northern border of Colombia. It separates the Caribbean Sea from the Pacific Ocean and is linked to South America by the Isthmus of Panama. and South American nations and, most recently, with Japan. The idea is not to diminish Nafta; its benefits go beyond the economic. Officials from both Mexico and the United States Relations between the United States and Mexico are among the most important and complex that each nation maintains. They are shaped by a mixture of mutual interests, shared problems, and growing interdependence. admit the trade deal has "created a new dynamic" between the neighbors. On the occasion of the 10th anniversary of Nafta, the Dallas Morning News said the agreement had "launched an era of economic, political and social intimacy between ... the two countries whose long, uneasy coexistence once won them the sobriquet of 'distant neighbors.'" An examination of the trade figures also speaks volumes. U.S. exports to Mexico grew by over 150 percent in the first eight years of Nafta (from US$45.29 billion in 1993 to US$113.77 billion in 2001). Mexican exports to the United States rose roughly 230 percent (from US$42.85 billion in 1993 to US$140.3 billion in 2001). Nafta has proven to be a tremendous benefit for some companies and sectors. Multinationals with advanced technologies were in the best position initially. The automotive sector took the lead and Mexico is a key country in the global supply chains of corporate giants such as General Motors, Ford and Delphi (see page 24). [ILLUSTRATION OMITTED] President Vicente Fox is taking it one step further. His administration has set up programs targeting small- and medium-sized businesses that want to enter the export business. Progress has been difficult, but it is measurable. Touting Reform Mexico is one of the world's most trade-dependent countries, particularly as regards commerce with its northern neighbor, which buys roughly 85 percent of its exports. The sluggish U.S. economy in 2001 hit Mexico hard as investments fell and Mexico's maquiladora ma·qui·la·do·ra n. An assembly plant in Mexico, especially one along the border between the United States and Mexico, to which foreign materials and parts are shipped and from which the finished product is returned to the original market. industry suffered hundreds of thousands of layoffs. Business leaders recognize the need to stop relying on low-cost labor since China, India and Central America Central America, narrow, southernmost region (c.202,200 sq mi/523,698 sq km) of North America, linked to South America at Colombia. It separates the Caribbean from the Pacific. can successfully challenge Mexico in this arena. The private sector has been pressing the government for a reduction in red tape, urging greater flexibility in the labor laws labor law, legislation dealing with human beings in their capacity as workers or wage earners. The Industrial Revolution, by introducing the machine and factory production, greatly expanded the class of workers dependent on wages as their source of income. and an end to the restrictions on private investment in power generation. [ILLUSTRATION OMITTED] Success Stories Despite these challenges and faced with an increasingly competitive environment, many Mexican companies This is a List of Mexican companies:
Foreign direct investment is a bright spot in the Mexican economy. The manufacturing sector and the financial sectors lead the way and show promise of continuing growth. The numbers seem to bear this out. Sixty Mexican companies populate To plug in chips or components into a printed circuit board. A fully populated board is one that contains all the devices it can hold. the list of the most recent Top 200 Exporters in Latin America compiled by AmericaEconomia. (We have recreated the list on page 20, including only the Top 50 Mexican companies.) In March, the Economic Commission for Latin America Noun 1. Economic Commission for Latin America - the commission of the Economic and Social Council of the United Nations that is concerned with economic development in Latin America and the Caribbean (CEPAL CEPAL Comisión Económica para América Latina y el Caribe , for its Spanish initials) released a report detailing the Top 25 Trans-Latin American companies rated by investments in other Latin American countries List of American countries Nations:
Grupo Bimbo was established in Mexico in 1945, today it is one of the most important baking companies in brand and trademark positioning, sales, and , Grupo Modelo Grupo Modelo is a large brewery in Mexico. It maintains a large part of the Mexican beer export market and produces top-selling imported beer in the United Kingdom, United States and Canada. , Grupo Imsa, Televisa, Grupo Maseca and Elektra. Cemex was recognized as the Latin American company with the highest percentage of its assets abroad. We profile Cemex on page 23. Grupo Bimbo, Grupo Maseca (Gruma) and Grupo Modelo have long proven that Mexico's food and beverage F&B is a common abbreviation in the United States and Commonwealth countries, including Hong Kong. F&B is typically the widely accepted abbreviation for "Food and Beverage," which is the sector/industry that specializes in the conceptualization, the making of, and delivery of foods. industry is world class. Bimbo (see page 22) is the third-largest baker in the world and has cleverly positioned itself to take advantage of the burgeoning Hispanic market in the United States. Gruma established operations in the United States nearly 30 years ago (see page 25) and plans on tackling the Chinese market this year. Modelo's top-selling beer, Corona, has been a global brand for years and eight years ago Corona edged aside Heineken as the No. 1 imported beer in the United States (see page 28). In the metals and manufacturing industries manufacturing industries npl → industrias fpl manufactureras manufacturing industries npl → industries fpl de transformation , Mexico also can boast global giants. Grupo Imsa has operations and sales on five continents and 55 percent of its revenues are generated outside of Mexico (see page 26). Mabe teamed up with General Electric decades ago and was a player in the export market shortly after it was founded in the 1940s (see page 27). We have also chosen to profile Pemex (see page 29). Though it is a state-owned company and faces extreme cash-flow challenges since it is closed to private investment, its presence as the No. 2 exporter in all of Latin America made it a worthwhile contrast to the seven successful private companies we briefly examine in the following pages. Surely there are many more Mexican companies worthy of a profile in a study about export success and global presence. We chose the eight that you'll read in the pages that follow not only to highlight their dynamism and forward-looking strategies, but also in an effort to touch a variety of sectors.
TOP 50 MEXICAN COMPANIES ABROAD
EXPORTS (IN US DOLLARS)
RK COMPANY SECTOR 2003 2002 %VAR.
1 Petroleos Mexicanos Oil/hydrocarbon 18.6bln 14.4bln 29.2
2 General Motors Automotive 8.85bln 9.09bln -2.7
3 DaimlerChrysler Group Automotive 6.31bln 6.74bln -6.5
4 Cementos Mexicanos Cement 4.41bln 4.22bln 4.4
5 Volkswagen de Mexico Automotive 3.89bln 4.71bln -17.2
6 Delphi Autoparts 3.43bln 3.14bln 0.5
7 IBM Computers 3.13bln 2.99bln 4.5
8 General Electric Electronics 1.99bln 1.84bln 8.2
9 Grupo Mexico Int'l Mining 1.92bln 1.89bln 1.5
10 Grupo Alfa (Holding) 1.83bln 1.50bln 22.0
11 Visteon Autoparts 1.69bln 1.90bln -11.3
12 Grupo Mexico Mining 1.52bln 1.41bln 7.4
13 Grupo IMSA Steel .50bln 1.46bln 2.6
14 Nissan Mexicana Automotive 1.47bln 2.06bln -28.5
15 Grupo Bimbo Food 1.42bln 1.42bln -0.1
16 Ford Automotive 1.41bln 1.99bln -29.4
17 Grupo Maseca (Gruma) Food 1.39bln 1.28bln 8.6
18 FEMSA Beverages/Beer 1.27bln 362mln 251
19 Panamerican Beverages Beverages/Beer 1.27bln 1.62bln -21.8
20 Mabe Electronics 1.10bln 1.04bln 5.6
21 KOF Coca-Cola Femsa Beverages/Beer 1.06bln 170mln 524
22 Alpek Petrochemicals 1.04bln 906mln 14.8
23 Grupo Modelo Beverages/Beer 961mln 873mln 10.1
24 DESC (Holding) 843mln 866mln -2.7
25 Grupo Xignus (Holding) 762mln 722mln 5.5
26 Pepsi-Cola Mexicana Beverages/Beer 751mln 764mln -1.6
27 Nemak Autoparts 722mln 685mln 5.4
28 Versax (Holding) 662mln 712mln -7.0
29 Imsatec Metallurgy 613mln 595mln 3.0
30 Industrias Penoles Mining 607mln 528mln 15
31 Grupo Villacero Steel 579mln 566mln 2.3
32 Grupo Vitro Glass 576mln 595mln -3.2
33 Imexa-Ispat Mexicana Steel 562mln 435mln 29.4
34 Desc Automotive Autoparts 537mln 555mln -3.3
35 Grupo Petrotemex Chemicals 535mln 518mln 3.2
36 Grupo Kodak Photography 529mln 563mln -6.0
37 Imsa Acero Steel 489mln 444mln 10.1
38 Grupo Carso (Holding) 452mln 437mln 3.6
39 Tubos de Acero de Mexico Steel 447mln 452mln -1.2
40 Mineria Mexico Mining 401mln 372mln 8.0
41 Grupo Televisa Media 365mln 323mln 12.9
42 SanLuis Corporacion Autoparts 363mln 318mln 14.3
43 Met-Mex Penoles Metallurgy 351mln 370mln -5.0
44 HyIsamex Steel 321mln 276mln 16.4
45 Grupo Industrial Saltillo Autoparts 280mln 300mln -6.8
46 Grupo Condumex Autoparts 272mln 299mln -9.0
47 Enermex Autoparts 260mln 236mln 10.2
48 ICA Construction 240mln 236mln 1.4
49 Desc Sector Quimico Chemicals 208mln 246mln -15.5
50 Telefonos de Mexico Telecom 207mln 256mln -19.1
RK COMPANY OWNERSHIP MARKETS
1 Petroleos Mexicanos State U.S., Spain
2 General Motors Private * U.S., Canada
3 DaimlerChrysler Group Private * U.S., Latin America
4 Cementos Mexicanos Private U.S., EU, LatAm
5 Volkswagen de Mexico Private * U.S., Can., Germany
6 Delphi Private * N/A
7 IBM Private * U.S., Canada, Asia
8 General Electric Private * U.S., Latin America
9 Grupo Mexico Int'l Private N/A
10 Grupo Alfa Private U.S., EU, LatAm
11 Visteon Private * N/A
12 Grupo Mexico Private U.S., Asia, LatAm
13 Grupo IMSA Private U.S., Latin America
14 Nissan Mexicana Private * U.S., Saudi Arabia
15 Grupo Bimbo Private U.S., LatAm, EU
16 Ford Private * U.S., Canada
17 Grupo Maseca (Gruma) Private U.S., LatAm, EU
18 FEMSA Private U.S., EU, LatAm
19 Panamerican Beverages Private Latin America
20 Mabe Private U.S., Latin America
21 KOF Coca-Cola Femsa Private Argentina
22 Alpek Private U.S., Latin America
23 Grupo Modelo Private U.S., EU, Asia
24 DESC Private U.S., EU, LatAm
25 Grupo Xignus Private N/A
26 Pepsi-Cola Mexicana Private * N/A
27 Nemak Private U.S., EU
28 Versax Private U.S., EU
29 Imsatec Private N/A
30 Industrias Penoles Private U.S., EU, Asia
31 Grupo Villacero Private N/A
32 Grupo Vitro Private U.S., EU, LatAm
33 Imexa-Ispat Mexicana Private * U.S., Asia
34 Desc Automotive Private N/A
35 Grupo Petrotemex Private N/A
36 Grupo Kodak Private * Singapore, U.S.
37 Imsa Acero Private U.S., Latin America
38 Grupo Carso Private U.S., EU, LatAm
39 Tubos de Acero de Mexico Private U.S., Asia, LatAm
40 Mineria Mexico Private N/A
41 Grupo Televisa Private U.S., EU, LatAm
42 SanLuis Corporacion Private U.S., EU
43 Met-Mex Penoles Private N/A
44 HyIsamex Private U.S., Latin America
45 Grupo Industrial Saltillo Private U.S.
46 Grupo Condumex Private U.S., LatAm, EU
47 Enermex Private U.S., Latin America
48 ICA Private U.S., Canada, LatAm
49 Desc Sector Quimico Private N/A
50 Telefonos de Mexico Private U.S., EU, Asia
* Indicates primarily foreign capital
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