Mexico’s Gálvez raises specter of missing out on nearshoring

Mexican opposition presidential candidate Xóchitl Gálvez warned the country could “lose nearshoring” if the frontrunner from President Andrés Manuel López Obrador’s Morena party, Claudia Sheinbaum, wins the June 2 election.  

“I'm telling you clearly, so that there is no doubt, six more years of Morena and we're done with nearshoring, bye bye nearshoring,” Gálvez told a banking convention in Acapulco on Friday. 

Mexico has positioned itself as a key epicenter for the relocation of companies, mainly due to its proximity and commercial ties with its main trading partner, the United States. A total of 73 private sector investments were announced in Mexico between January 1 and March 15, exceeding US$31bn, according to the economy ministry.

However, reports such as the one published at the beginning of this month by Georgetown University say investors have found challenges with issues such as "policy uncertainty, lack of rule of law, insecurity, and energy supply.” 

“Without the participation of the private sector in open and competitive auctions there will not be enough clean and cheap energy. Wake up, let's not let go the best opportunity we’ve had in a generation to boost our economy. We must shake off our fear and dare to achieve because the world is not going to wait for us,” Gálvez said. 

She is proposing five factors to take full advantage of nearshoring, namely: rule of the law, clean energy, treated and sufficient water supplies, education to create new talent, and security amidst rising crime committed by cartels. 

During her speech at the convention, she said her vision for the country involves Mexico becoming a country for the middle classes. 

To do so, she proposed: 

1 - A government that is a source of certainty

2 - Healthy public finances

3 - A government that protects citizens, not criminals

4 - Economic growth and job creation

5 - Reactivation of local economies and support for SMEs and entrepreneurs

6 - Infrastructure

7 - Social programs

8 - A government allied to prosperity.