Competing for Integration by Radtke Kurt W.;Wiesbron Marianne;Wiesebron Marianne;

Author:Radtke, Kurt W.;Wiesbron, Marianne;Wiesebron, Marianne;
Language: eng
Format: epub
Publisher: Taylor & Francis Group

Mexico and Brazil as strategic locations

Regional integration has brought about strategic considerations from the commercial point of view. NAFTA has propelled Mexico into the position of a strategic location or gateway to the U.S. market as well as to other Latin American markets. Because of the strong U.S. economy, demand for imports continues to be active, and European as well as Asian capital has been using Mexico as an export platform to the USA and Canada. For similar reasons, Brazil has emerged as a strategic location, because of its important position at the core of Mercosur/l—which now covers Argentina, Paraguay, Uruguay and associates, Bolivia and Chile. Brazil represents a large domestic market, and following its successful stabilization of macroeconomic conditions, has re-emerged as a highly-anticipated investment country.

Indeed, a recent survey of Japanese manufacturing firms with more than three overseas operations, covering projections for the next ten-year period, conducted by the Research Institute for International Investment and Development of the Export-Import Bank of Japan, shows that Brazil was the seventh most promising investment country in the 1997 Survey, while Mexico was placed tenth in the 1996 Survey (see Table 6.1).

Table 6.1. Japan: Top-ten Promising Investment Countries over the Next Ten Years

Order 1997 Survey 1996 Survey

Firms Firms

269 264

1 China 196 China 195

2 India 98 India 103

3 USA 83 Vietnam 87

4 Vietnam 64 USA 81

5 Indonesia 57 Indonesia 64

6 Thailand 44 Thailand 63

7 Brazil 30 Malaysia 31

8 Philippines 29 Myanmar 29

9 Malaysia 25 Philippines 28

10 Myanmar 14 Mexico 16

Source: Research Institute for International Investment and Development, Questionnaire Survey on Foreign Direct Investment, 1997 and 1996.

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