Foreign Investment in Mexico from the Perspective of the Foreign Investor.

A factor contributing to the continuation of the economic revolution in Mexico has been, and will continue to be, foreign investment. The liberalized foreign-investment regulations and the positive attitude of the Foreign Investment Commission (FIC) in approving foreign investment proposals promote a more favorable environment for foreign investors. The Mexican government recently completed negotiating the NAFTA, a proposed free-trade agreement with the United States and Canada. The government is now considering what additional actions may be required to compete successfully with those other nations trying to attract scarce investment funds.

Opportunities for foreign investors in Mexico are brighter than they have been in fifty years. Nevertheless, investors will make better decisions by being mindful of the substantial cultural and legal differences between the two countries, as well as the history of foreign-investment regulation in Mexico. This is true in negotiating the establishment of investments, joint ventures, and licensing agreements. With respect to the history of the FIL Regulation, an understanding of these directives is fundamental to predicting what the future may hold in this important area of human activity.

Most foreign investors look forward to the day when investment policies in Mexico will be more transparent. Mr. Jaime Serra, the Minister of Trade and Industrial Development, announced the FIL and the FIL Regulations will be amended in order to adopt the NAFTA. These amendments, Mexico’s liberalization of foreign investment controls, and commitments Mexico undertook in the NAFTA, move Mexico closer to a market driven and controlled by economic forces rather than government edict.