The increase of the manufacturing Industry and its impact in the economic development also brings a dynamism that benefits other sectors such as the restaurant, transportation, housing, finance, exporting among others
Mexico is one of most attractive investment destinations internationally due to it having a dynamic business environment, qualified human talent, commercial agreements and strategic geographic location. These factors cause a favorable environment for companies’ development.
In the last years it has been achieved attracting a great amount of companies that have betted to be installed in Mexico to export their products from here to the entire world.
According to ProMexico, the country has commercial treaties that give it access to 46 nations and 1,200 million consumers; in addition, Mexico has an internal market that exceeds the 120 million inhabitants.
ProMexico underlined that the country lives one of the best demographic moments in its history, as it has the largest population proportion in productive age and in addition, it is in the eighth place worldwide regarding a number of graduates from engineering with 120,000 graduates per year.
All these characteristics have turned Mexico in a highly competitive region for the development of the manufacturing exportation industry.
Nationwide, the Bajio has consolidated as the area that has grown the most in the last years.
Guanajuato, Queretaro, Aguascalientes and San Luis Potosi gather the economic, commercial and political conditions that place them in concentration points of foreign investments, mainly focused to the automotive sector.
Thus, the growth of the manufacturing industry and its impact in the economic development of Guanajuato also brings a dynamism that benefits other sectors as restaurants, transportation, housing, finance, exports, among others.
Guanajuato is one of the entities that have more economic growth according to the Ministry of Sustainable Economic Development (SDES, by its Spanish initials,) as the entity is the sixth economy in the country, with 4.2 % of the national Gross Domestic Product (GDP.)
In the current administration – from 2012 to 2017 – Gunajauato has grown about twice as the country, 21.2 % with 10.3 %, respectively.
It highlights the growth in manufacturers with more than 43 %, as well as the automotive industry, of auto-parts and beverages.
Only in 2012 to 2017, in Guanajuato were concreted 245 new investment projects with an amount higher than 11,760 million dollars and the generation of more than 79,500 jobs.
EXPORT MANUFACTURE INDUSTRY
According to Cesar Gutierrez, president of Index Guanajuato, the export manufacturing industry is one of Mexico’s main engines.
He underlined that in the last six Guanajuato has become one of the most important promoters of this scheme with the arrival of assemblers such as Mazda, Honda, Volkswagen and Ford, in addition of the growth General Motors has had and the announcement of the forthcoming arrival of Toyota.
He considered that for companies the main attractions in the State are its Strategic location, demographic mass and number of youngsters.
“Guanajuato has grown not only in the automotive activity, but also in different sectors such as leather-footwear, agro-food, chemical and home appliances, which have had an important growth in their exports,” he commented.
The Manufacturing, Maquila and Exports Services (IMMEX, by its Spanish initials) constitutes an important source of jobs and currencies.
Based in data from the INEGI up to October 2017, were registered 5,085 active establishments nationwide. While in Guanajuato there were 282 companies, what meant a growth of almost 18 % in comparison with the one from the same month in 2012.
Regarding the personnel occupied by IMMEX companies, it was reported a total of 2.6 million workers in Mexico and in Guanajuato, the figure reached 142,991 people, what represented an increase of 69.3 % in comparison with October 2012, when 84,431 employees were registered.
Regarding compensations paid to the occupied personnel, nationwide the amount was of 32,432 million pesos, while in Guanajuato was of 1,228 million, what represented a growth of 108 % in comparison to October 2012, when 540.7 million pesos were registered.
“It is demonized a lot that export manufacture companies pay low wages; in average wages are in a base between two to two and a half minimal wage of hiring and from there it increases to really interesting levels. The most important is that all these companies members of Index offer a correct remuneration scheme and comply the regulations established by law,” said Gutierrez.
Index mentioned that they are working to make companies certified, for them to be socially and labor responsible and to have an affinity of work with the community.
He said that when there is economic revenue from companies towards workers, those resources are reflected in the community, since collaborators seek where to acquire their goods and services.
That is why, he referred that the manufacturing export industry growth impacts in the development of other sectors such as restaurants, housing, educational and tourism, among others.
He considered that it is necessary to work in specialized personnel training, in the development of infrastructure; in a logistic scheme that allows carrying products quicker and in innovation and research.
Finally, he highlighted that Guanajuato has distinguished by its growth in the last years. “Investments arriving locate us almost in 3rd place of foreign investment nationwide, I have no doubt that more investment will continue arriving,” he ended.
PROVIDING ADDED VALUE
Guillermo Romero, secretary of Sustainable Economic Development in Guanajuato, announced that the entity contributes with 40 of every 100 dollars in production.
“The entity contributes with 40 % of the added value; this is noticeable because the average in Mexico is of 32 %. This means that Guanajuato is above the national average in industry and jobs participation,” he said.
According to data from the SDES, the secondary sector of Guanajuato contributes with 5.2 % of the national total, positioning in the 8th place. While, in the industrial sector without oil, provides 5.7 % occupying 7th place in the country.
The economic policy in Guanajuato is focused in the attraction of national and foreign companies, given priority to tractor companies in order to supply companies from all levels being installed after them.
He remembered that the State is located in the so called Mexico’s Diamond, where it generates 79 % of the GDP of the country.
In addition, he said that there has been a continuity program for more than 20 years, which started with the strategic study of Guanajuato Siglo XXI and until the current administration of Miguel Marquez, governor of the State, policies have been followed.
“Continuity generates confidence and confidence gives certainty; with that, investment flows naturally,” he said.
He explained that in the current administration (2012-2017) 245 new investment projects have been concreted, with an investment of more than 1,760 million dollars and the generation of more than 79,500 jobs.
“It is not the entire investment in the State; it does not include commerce, hotels and all sectors, only the automotive industry, chemical, food, plastics and leather-footwear, which are the industry we have strategically sought to promote for it arriving to the state.
Based in information from the SDES, the automotive-auto-parts sector occupies the 1st place in investment attraction with 8,527 million dollars and the generation of 62,986 jobs.
He said that the economic growth is an indispensable factor for long term social and sustainable development existence in a country.
The head of SDES referred that growth perspectives for the next five years are optimistic. “We live in a very complex world, but the economy continues growing,” he explained.
With the arrival of the manufacturing industry to the State, the region positioned as one of the more dynamic markets and the region with the biggest industrial spaces offer.
Roberto Villanueva, director of the Association of Private Industrial Parks of the State of Guanajuato (APIPEG, by its Spanish initials) said that with the confidence assemblers had of being installed in the region the encouragement was derived, growth and economic development in the entity.
The arrival of these companies has attracted companies from other countries to supply different products from Guanajuato. The supply companies have found in the industrial parks in the state, the ideal place to start their operations.
“It should be observed that previously the State was not considered an industrial area but fortunately, it has been considered like this for five years,” APIPEG has more than 20 private industrial developer brands, which represent more than 30 complexes located in different municipalities of Guanajuato.
These complexes represent about 4,500 hectares of industrial land offer, more than 200 companies established in the development and more than 70,000 jobs generated.
“APIPEG members have generated about 70,000 jobs and each one of the industrial parks in the State are considered of Premium quality, as they have all services required by transnational companies,” he underlined.
He commented that another factor that has encouraged growth is the confidence developers have had to invest in Guanajuato.
Regarding growth perspectives in the next five years in the industrial real estate area, he explained that the increase will be dynamic and sustained. “The growth has been growing by leaps and bounds; the Association has two years of being created. From 2015 to the date we have seen a very large development, we believe that this will have continuity and that will be triggered in the generation of more industrial parks,” he explained.
Exports are some of the main growing engines in the Bajio, its importance lays in the effect they have upon the economic growth in issues as productivity and employment.
According to data from the Foreign Trade Promotion Coordinator (COFOCE, by its Spanish initials) in the last five years, exports in the State have presented a favorable behavior, which reflects in the growth of destinations, jobs, municipalities and export companies in the entity.
Among the most exported products in the State are automobiles, axis, gear boxes, parts and vehicles accessories, broccoli, pneumatics, razors, lettuce, tomatoes, and minerals, among others.
Products made in Guanajuato reach 125 destinations worldwide.
The terrestrial cargo motor transportation activity in Guanajuato represents a 33 % of the total level nationwide, this due to the growth of the manufacturing industry, especially in the automotive sector, Enrique Gonzalez Munoz said, regional vice-president Centro-Bajio from the National Chamber of Freight Transportation (CANACAR, by its Spanish initials.)
He emphasized that this growth also has been reflected in the leather-footwear industry, as currently, leather derived products are commercialized in the entire country and in the world, and most are produced in Guanajuato therefore merchandise transfer increased through terrestrial via to different points in the country.
“Guanajuato has excellent connection with the main ports. The State Government job is to keep the import and export activity of raw material and finished product, this is, to promote the manufacturing sector and support the improvement of roads in order to reduce time,” he explained.
He added that from imported and exported finished products and raw material in the country, the automotive is the one that has reported an important growth with the arrival of new assemblers.
He referred that assemblers such as Mazda and Honda have increased their manufacturing; therefore there is a trend in the increase of merchandise movement for the arrival of supply.
The vice-president informed that from November 2011 to November 2017, more than 536 tons of products for the automotive industry were moved, from which 80 % were through terrestrial transportation.
With that, more than 586 million tons were accounted which were transfer through transportation.
“For example, from Guanajuato Inland Port (GIP,) are supplied assemblers such as Nissan which is in Aguascalientes, Audi in Puebla with engines and components; same case as supply for Ramos Arizpe; however, for some assemblers that are about to start operations as in the case of BMW in San Luis Potosi we have documented 80 % of its supply will be from companies established in Guanajuato, therefore the local transportation sector will be the most benefited,” he noted.
He considered that this gives the pattern to prove that the automotive industry is the one leading manufacturing in Guanajuato; therefore the transportation sector plays a very important role for supply in vehicle manufacturing.
SALE OF VEHICLES
“In the last 10 years, Guanajuato has grown to a 6 % level,” said Arturo Gonzalez Palomino, president of the Mexican Association of Automotive Distribution (AMDA, by its Spanish initials) in the entity.
This, he said, derived to students and people migration that arrive to work in the entity; that is why car purchase has been favored.
He said that 2016 was one of the best years regarding vehicle sales with a 30 % growth, while in 2017 there was a decrease of 4.1 %.
“The arrival of this industry has benefited us as Distribution Association and an important point is that we have strengthened the value chain. The spare parts area, the one of industry services and engineering, they start to agglomerate and allow us having suppliers at hand,” he said.
There were 19 car brands 10 years ago in the state, but today there are almost 42. In the area there are 140 sales points of 64 car dealers. In Leon, Celaya, Irapuato, Guanajuato Capital and Salamanca there is more positioning. This industry has generated 10,000 direct jobs and 12,000 indirect ones.
Automobile brands that have more sales in the State are Nissan, General Motors, Volkswagen, Toyota, Honda and Chrysler.
Regarding Premium brands, the market has increased and different companies such as McLaren, Lotus and Maserati have been favored when arriving to Guanajuato.
“The market has been wide and gives us to have different Premium brands which were not seen on streets. We see that we have a strong potential due to the investments that had arrived. Companies’ executives are those brands buyers,” he explained.
International companies that have installed in the area have invested in fleets for their personnel. However, this kind of sales decreased due to the reference interest rate from the Bank of Mexico, which reached 7.25 % increase; thus as the uncertainty present with the North America Free Trade Agreement.
“We have to generate knowledge about the consumption habits, we want to make companies aware for them to be prepared and increase their sales,” he referred.
FINANCE AND BANKING SERVICES, TO THE RISE
For Vicente Lopez Portillo, East regional delegate from the National Commission for the Protection and Defense of Users of Financial Services.
“The fact of opening a job, and industrial park or a company means that there will be workers needing a debit card to collect they pay and from there are derived other kind of products and finance services. The more companies and workers there are, it will be necessary to provide them with finance infrastructure,” he explained.
He informed that from 2012 to 2017 a 68 % increase have been registered in payroll accounts, a 9 % in debit cards and 30 % in credit cards. “These growths are a reflection of the development of the economic activity,” he explained.
Regarding multiple banking institutions he announced that currently there are 582 subsidiaries in the State, this means 17 more than in 2012. “Guanajuato is of the most important States in terms of finance products terms,” he underlined.
For the delegate, the manufacturing industry will continue arriving to the state, therefore it is also expected an important growth in finance terms.
“Every time we have more the newest products in their usage and one of the most important challenges is that inclusion and banking must go together with finance education,” he considered.
Guadalupe Arrieta Nicasio, general manager of the National Chamber of the Restaurant and Condiment Food Industry (CANIRAC, by its Spanish initials) Leon, said that the arrival of transnational companies to the State has impacted the gastronomic industry in the area.
“Previously we did not thought about they want, we only saw it as a service, but for time now we are working in the Chamber to know the needs from the sectors,” she said.
The growth CANIRAC has detected is in the expansion that industrial dinners have, but we have been working in the Chamber to know the needs from the sectors for some time now,” she explained.
The growth CANIRAC has detected is in the expansion industrial dinners have, therefore they had to be trained to answer the needs of each company.
Currently in Guanajuato there are about 680 establishments registered in the Chamber, being Leon the municipality with greater number of members and with an approximate of 183, following are San Miguel de Allende, Celaya, Guanajuato Capital, Irapuato and Salamanca.
The institution has certifications to improve the industries such as Punto Limpio, which has the objective of providing good hygiene practices; Gran Anfitrion, which strengthen companies in business derationing and customer services; Distintivo H, who assures the quality of tourist services; and Distintivo M, which bases in human quality, customer’s satisfaction and routine and improvement management.
“We are attached to what tourism requires. This year several companies have been certified and 21 establishments were updated. This is something we are working within CANIRAC,” she noted.
The restaurant sector in the entity has the 2nd place in job generation nationally and in order to train its collaborators they have had the support of the SDES and with the Municipal Tourism Direction of Leon.
Last year, CANIRAC trained a total of 70 people, they have prepared people in how treat people from abroad according to culture and the customs they have, and in addition, they have lectured courses in Japanese, English and French, likewise they are thinking in implementing a fourth language in order for workers be more prepared.