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Export and FDI Promotion Institutions: Are there any success stories

2. Contents. Exports and FDI evolutionBancomext: some findings in trade promotion Bancomext results. 3. Attraction of FDICoordination of different organizationsFederal and local governmentsPrivate-public sectorsPromoting the competitiveness of Mexican firmsFinancingPromotional toolsTechni

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Export and FDI Promotion Institutions: Are there any success stories

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    1. Export and FDI Promotion Institutions: Are there any success stories? Héctor Reyes Retana President and CEO Mexico’s National Bank for Foreign Trade

    2. 2 Contents Exports and FDI evolution Bancomext: some findings in trade promotion Bancomext results

    3. 3 Attraction of FDI Coordination of different organizations Federal and local governments Private-public sectors Promoting the competitiveness of Mexican firms Financing Promotional tools Technical assistance MEXICO’S EXPORT STRATEGY Has relied on stability, liberalization, trade agreements and promotion

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    5. 5 Foreign direct investment, 1980-2005 (million dollars) In the last decade Mexico has received 140 billion dollars in FDI And remains as the second FDI recipient among emerging economies The U.S. is the main FDI source for Mexico With 63% of total And Mexico is the leading destination of U.S. investment

    6. 6 MAIN CHALLENGES AHEAD Decreasing share in world exports Mexico ranks as tenth world exporter (considering the European Union as a whole) But has started to decrease its share in world exports From 3.3% to 2.8% between 2000 and 2005 This is due to: Loss of competitiveness arising from pending domestic reforms Participation of new countries in international trade, such as China The impact of Nafta started to fade out and other countries have obtained similar advantages

    7. 7 MAIN CHALLENGES AHEAD To incorporate a greater number of small and medium size firms to the export chain 543 firms account for 80% of non-oil exports The other 20% comes from 22,854 firms To diversify export markets 86% of total exports go to United States To increase the national contents of exports

    8. 8 BANCOMEXT: SOME FINDINGS IN TRADE PROMOTION

    9. 9 BANCOMEXT OVERVIEW Founded in 1937 Own resources generation Export credit and guarantees Information, advise and training Promotion in Mexico and abroad Focused on small and medium size exporting firms Attraction of foreign direct investment into Mexico 35 representative offices in Mexico and 31 offices abroad

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    12. 12 INTERNATIONAL TRENDS IN EXPORT PROMOTION ORGANIZATIONS To offer a more efficient support to exporting firms

    13. 13 INTERNATIONAL TRENDS IN EXPORT PROMOTION ORGANIZATIONS To offer a more efficient support to exporting firms

    14. 14 BANCOMEXT APPROACH TO EXPORT PROMOTION Close collaboration with the private sector and local governments The leading private organizations are in our Executive Board In many cases we develop joint promotional activities We have gradually increased the share of products and services that are sold to our customers Bancomext solves Mexican exporters needs regarding financial and promotional services Offers trade promotion, financing and attraction of FDI “One stop shop” for those firms looking for services that would help them compete abroad

    15. 15 BANCOMEXT APPROACH TO EXPORT PROMOTION Our services cover the whole export cycle The coordinated work of our offices constitutes an important value added to the export chain The comprehensive approach has resulted in efficiency gains For Mexican exporters In the attraction of FDI, since trade and investment flows are closely linked Promotional services are provided in Mexico and abroad In order to facilitate the contact between exporters and importers Financing is offered directly or through financial intermediaries

    16. 16 BANCOMEXT APPROACH TO EXPORT PROMOTION Promotion is focused on specific export projects Matching highly competitive exports and the specific markets demanding those products Project management and supervision through an electronic network that involves: Our foreign offices around the world, our national branches all over the country and the central headquarters in Mexico City Follow-up, evaluation and feed back To improve process operation and customer satisfaction we systematically measure the impact of the Bank’s services and their performance A whole system of performance indicators has been implemented There is no central government budget for export promotion

    17. 17 BANCOMEXT RESULTS

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    19. 19 TOTAL CREDIT, 2004-2006 (Million dollars)

    20. 20 TRADE PROMOTION CONTRIBUTES TO EXPORT DEVELOPMENT Bancomext services generate annual exports over 6 billion dollars This amount represents 38% of SME’s exports* Each year Bancomext promotional services enable, on average, 2,000firms to export

    21. 21 BANCOMEXT: NUMBER OF FINANCIAL AND PROMOTIONAL SERVICES PROVIDED TO SME’s BETWEEN 2001 AND 2005 In the last five years services granted to SME’s have multiplied by three

    22. 22 ATTRACTION OF FDI In 2002 Bancomext received the mandate to promote FDI We work in coordination with: The Ministries of Economy and of Foreign Relations as well as with state governments Between 2002 and 2005 FDI projects reached five billion dollars Mostly in export oriented activities such as automotive and autoparts, electronics, textile and apparel, food and agribusiness and metal-mechanic

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