Mexico returned to consultancy Kearney’s ranking of the 25 most attractive countries for foreign direct investment (FDI), helped by companies’ interest in nearshoring.
“Mexico rejoins the main index at 21st after a five-year hiatus, perhaps owing to the benefits it is reaping from nearshoring,” the FDI 2024 confidence index report said.
See the report in the Documents box in the top-right corner of the screen.
The index is led by the US for the 12th consecutive year, followed by Canada and China, which was seventh last year but displaced Japan in 2024.
Mexico dropped out of the ranking in 2020, something that had not happened since 2011.
“Strikingly, the [Mexican] market saw a 5.8% increase in exports to $52.9bn year-over-year in May 2023 on the back of growing US demand, representing the second-highest reading on record,” added the report.
“Mexico is the country that has benefited the most from manufacturing investments that migrate from Asia and other places. Investors consider that the country will continue to be a cornerstone for nearshoring to the United States,” Kearney CEO Omar Troncoso told outlet El CEO.
Emerging markets on the rise
This year’s survey demonstrated investors’ preference for developed and trusted markets, which represented 17 of the 25 economies in the Index. However, 19 developed markets dominated the index last year, suggesting investor sentiment about emerging markets is on the rise.
Emerging markets performed better in the 2024 edition in several metrics. In fact, 84% of respondents indicated they plan to maintain or seek new investments in emerging markets, up 3% from last year.
“The addition of Brazil, Mexico, and Argentina this year is perhaps a reflection of the growing reshoring, nearshoring, and friendshoring movement. Kearney’s reshoring index highlights this nearshoring dynamic using Mexico as a key example,” the report said.
It also highlighted that US imports of Mexican manufactured products have increased from US$320bn to US$402bn since the start of the COVID-19 pandemic.
