The start of 2015 may still be several weeks away, but business owners have a lot to look forward to, as companies operating in the Latin American country are projected to help the nation improve its economic standing.
The Mexican economy is anticipated to grow by 3.7 percent next year, thanks largely to increasing demand among consumers, the Wall Street Journal has learned. The growth projection was recently mentioned in a budget estimate sent to lawmakers in Mexico on Sept. 5.
The economic forecast comes on the heels of what financial analysts are predicting for the country’s gross domestic product next year, which if reached would outperform the 2.7 percent expansion witnessed through the first eight months of 2014.
Mexico’s economy has been on something of a roller coaster ride since the beginning of the year. The paper noted that production of goods and services were relatively limited in the first quarter, only to increase by about 1 percent in the succeeding three-month period. Tracing back to 2012, weak gains were largely linked to reduced trading with U.S.-based partners. Making trade conditions more difficult were tax increases the government instituted to help reduce the country’s deficit.
Helping to improve business owner sentiment for next year is the lack of tax increases that are expected, WSJ reported from ministry officials’ budget estimates.
Trade deficit widens in July
The U.S. is one of Mexico’s main trading partners, but in July, trade activity dipped, evidenced by the country’s trade gap increasing to $618 million from $544 million during the same month in 2013, Bloomberg reported from trade ministry statistics. Nine economists polled by the business news source anticipated a deficit, but only $325 million.
A potential explanation for the widening trade gap may be due to China, which is taking on more of a role as a main trading partner of the U.S. Bloomberg noted that Mexico is losing some business to the world’s most populous nation, as through the first half of the year, exports to the U.S. rose 2.7 percent. However, Chinese exports increased by 25 percent over the same six-month stretch.
Businesses that operate out of Mexico can only do so if they’re in compliance with the current set of regulations. With eContabilidad now due for January 2015 – ensure you understand how to manage both the profits and pitfalls of doing business in Mexico. The revenue opportunities continue to grow, but so will the financial penalties if you are not fully prepared for the changes in legislation.