Mexico and Latin American EconomiesAmado Villarreal

Mexico and Latin American Economies

11 November 2014

Mexico and Mexico and Latin American Latin American

EconomiesEconomies

Amado VillarrealAmado Villarreal

17th TCI Global Conference17th TCI Global ConferenceMonterrey, N.L. MéxicoMonterrey, N.L. México

Page 3YOUR LOGO

1. Mexico’s Strategic Sectors

2. Latin America’s Strategic Sectors

3. Common Strategic Sectors and Future

4. Policy Implications: Icluster – Mexico - Texas

5. Conclusions

Contenido

1. Mexico

STRATEGIC SECTORS

MEXICAN STRATEGIC SECTORS

No. CLUSTER PE CEI CAIE TLCAN

1Transportation equipment cluster (Automotive and Autoparts

• • • •

2 Electronic cluster• • • •

3 Plastics • • •

4 Tourism cluster • • • •

5Obtaining and processing of non-metallic minerals and fuels

• • •

6Food, beverages, confectionery and snuff

• • • •

7 Chemical manufacturing cluster • • • •

8Obtaining and processing of metal ores and metal products

• • • •

Fuente: Amado, Villarreal (2013). Identificación de Oportunidades Estratégicos de Desarrollo para México

2. Latin America

STRATEGIC SECTORS

Page 7YOUR LOGO

Latin America – Strategic Sectors

Source: The Atlas of Economic Complexity. Harvard University, with World Trade Data, UN.

More than 90% of exports from Latin America are concentrated in the following eight strategic sectors.

Exports - 2012 Argentina Colombia Chile Brazil MexicoEnergy 10.91% 57.24% 24.06% 26.19% 14.10%Automotive 12.00% 1.40% 0.90% 8.63% 18.52%Electronics 3.27% 1.95% 1.20% 7.89% 36.75%Obtaining and processing of metal ores and metal products 7.80% 11.06% 42.12% 9.35% 8.32%Agribusiness 52.98% 14.91% 18.34% 31.85% 6.52%Chemical manufacturing 9.17% 7.79% 4.81% 8.08% 6.04%Wood Products 1.26% 1.74% 7.16% 4.81% 0.66%

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Trade between Latin America and the rest of the World

Source: The atlas of economic complexity

Mexico, Colombia, Brazil and Chile export less than 10% of its products to Latin American countries

Page 9YOUR LOGO

3.

COMMON STRATEGIC SECTORS AND FUTURES

Technological Megatrends Impact

Technology push The comercialization of a scientific or technologic innovation in a defined market.

ClustersAgro – Food -Medical Biotechnology

Intelligent materials and Surface Engineering

MEMsMicro and Nanotechnology

New Energy Technologies

Energy

Automotive and Autoparts

Electronics

Agribusiness

Obtaining and processing of metal ores and metal products

Chemical manufacturing

Wood Products

THE ICLUSTER Iniciative

Page 12YOUR LOGO

1. Mexico

2. Latin America

3. Strategic Sector

4. Icluster – Latin America

5. Conclusion

Region’s composition

.Region Mexico :

Monterrey-Saltillo-Laredo-Reynosa

Region United States :

Dallas – Houston – San Antonio - Austin

Strategic Clusters

BUSINESS SERVICES CLUSTER

CHEMICAL MANUFACTURING CLUSTER

LOGISTIC CLUSTER

TOURISM CLUSTER

MAQUINARY AND EQUIPMENT CLUSTER

ELECTRONIC EQUIPMENT CLUSTER

TRANSPORTATION EQUIPMENT CLUSTER

MEDICAL SERVICES CLUSTER

ENERGY, OIL AND GAS CLUSTER.

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ELECTRONIC EQUIPMENT CLUSTER The quantity of business

located on the US and Mexico is very similar.

End Products and Intermediate Products companies are alike in both regions.

This is a proxy of complementarity in both regions.

The following slide shows a list of companies of the cluster.

Productive Chain Texas Mexico

End products

220

196

Intermediate products

289

388

Main inputs

1,267

1,666

Marketing - 16,629

Services for the cluster supply chain

40,767

12,627 Related industries

1,264 309

In general, this analysis is a primer on the binational value chains, showing some evidence of complementarity and identifying possible puntual areas of opportunity to

design binational regional economic development strategies.

CONCLUSIONMEXICO AND LATIN AMERICA

Regional Economic Development Strategies

1.It is essential to define the productive potential opportunities of the Latin American countries;

1.Guide policy to strengthen strategic sectors or clusters and

1.Guide efforts to accumulate core competencies around the tech trends that have more impact on the strategic sectors and

2.Create value through inserting the Latin American economy in the knowledge economy and on the global value chain.