The challenges for the Mexican economy
Manuel Romo, CEO of Citibanamexconsiders that one of the challenges is to trigger investment so that banks can finance projects that promote economic growth.
High interest rates is an issue that could affect the placement of credit in Mexico and some banks have sought to raise little or maintain rates at levels similar to the pandemic.
However, mortgage loan rates – which reached single digits – are already returning to rates of 10% and placement is beginning to slow down, according to data from Banxico.
For Scotiabank, although 2023 will be an economic slowdown, it still has opportunities in the placement of financing such as the automotive company that has suffered in recent months due to the fact that the lack of chips caused low sales of new cars.
The good news
Bankers agree that one of Mexico’s strengths lies in the fiscal discipline that the federal government has maintained.
“We believe that the fiscal discipline that this government has followed has been extremely positive, when you see the levels of debt against GDP we have remained at healthy and adequate levels,” he says. Adrián Otero, CEO of Scotiabank Mexico.
Another piece of good news is that despite the high interest rates, people continue to demand credit through cards, although this is due to the low level of banking in the country, he says. Santander Mexico.
The opportunities are in the
One of the greatest opportunities in the country is relocation or nearshoring, since the arrival of new companies represents one of the greatest opportunities for the corporate banking business as well as jobs.
“Mexico is a clear potential winner of this deglobalization scenario. The factors described above are generating a relocation of extensive value chains and our country is an unbeatable candidate to receive investments due to its proximity to the North American market, its broad and diversified export platform, its extensive network of trade agreements, and its hard-working people, who are more educated and specialized every day,” Manuel Romo notes.
Adrián Otero adds that one of the proofs that the relocation of supply chains is already in Mexico is the growth in storage plants in states such as Chihuahua.