The State of Tamaulipas is shaping up to have more investment in 2019

Tamaulipas is a land of opportunities for those looking to expand their businesses or start their business operations.

The state has a connected border that offers competitive conditions for investors, in addition, it has highly qualified and specialized human capital on its main clusters: electrical-electronic, auto-parts, chemical and petrochemical, information technologies, metal-mechanic, aerospace and medical industry.

Tamaulipas has consolidated as one of the States with highest foreign direct investment.

At the beginning of each year, Mexico Industry shows the most important data regarding business absorption, those companies that expanded their operation plants and those that trusted the advantages offered by the State to settle their production industrial buildings either in Matamoros, Reynosa, Nuevo Laredo or Altamira; main municipalities with presence in the export industry.

The Manufacturing, Maquila and Export Services (IMMEX, by its Spanish initials) is very important for Mexico and particularly for Tamaulipas, since it is here where most of jobs are and also an economic revenue to personnel payment and consumption of goods and services.

Strong positioning of IMMEX in Tamaulipas

Data provided by the secretary of Economic Development in Tamaulipas, Carlos Alberto Garcia Gonzalez, noted that up to August 2018, 6,208 IMMEX establishments were registered in Mexico, from which 82.8 % belong to the manufacturing industry.

The total of jobs in this industry in the country was 2 million 981 thousand 713 people.

In Tamaulipas the number of establishments was of 411 IMMEX, with 257 thousand 258 workers.

Tamaulipas, eighth entity with the highest investments flow

There are important competitive advantages in Tamaulipas which position the entity among the eight with the highest flow of Foreign Direct Investment.  The geographical position locates this State as the link point for production and commerce of the most important region of America.

Among the challenges the manufacturing industry has to continue being competitive will be without doubt the end of negotiations about Agreements and Trade Treaties that enable the free flow of goods and the elimination of tariffs to key products in the industrial activity, since these impositions raise productive processes, that impacts directly on competitiveness level.  Another important challenge that must encourage world economies, is to provide certainty and confidence to investors.

Snapshot of the industry in Tamaulipas

In August 2018, Tamaulipas registered 411 IMMEX establishments, from which 86.8 % were manufacturers and the rest from primary and tertiary activities.

It participates with 6.6 % of the IMMEX establishments and is located in fifth place nationally.

Within municipal distribution of IMMEX manufacturing companies, there are 152 companies established in Reynosa, 111 in Matamoros; 33 in Nuevo Laredo and 62 in other municipalities of the State.

The number of workers in IMMEX of Tamaulipas was of 257,258.  95.7 % are manufacturing jobs.  It participates with 8.6 % of the total of workers from national IMMEX and is located in fifth place.

Regarding municipal distribution of IMMEX manufacturing establishments workers, 126,273 workers are concentrated in Reynosa; 58,129 in Matamoros; 30,000 in Nuevo Laredo and 32,360 in other municipalities of the State.

Reynosa concentrates 42 % of the IMMEX manufacturer establishments of Tamaulipas and employ 51 % of the total workers.  Between Matamoros and Reynosa are concentrated 74 % of jobs from IMMEX.

Tamaulipas and its 12 strategic sectors

There must be remembered that Tamaulipas has an important economic diversity which characterizes the productive vocations of its seven regions.  A sustained economic development is encouraged in the state in 12 strategic sectors, these are:

·         Agroindustry

·         Tourism

·         Energy

·         Electronic

·         Logistic services

·         Business support services

·         Home appliances

·         Medical equipment manufacturing

·         Chemical and petrochemical

·         Construction products manufacturing

·         Metal mechanic

·         Automotive and transportation equipment

Carlos Garcia said that it is expected that Foreign Direct Investment to increase in Tamaulipas during 2019, this as result of the investments production agency launched by Tamaulipas Government.

“We consider that the sectors with great business opportunity in our region are the energetic, chemical, petrochemical, aerospace, metal-mechanic and electric sectors,” the secretary explained.

Investments for Tamaulipas

At the moment, Tamaulipas has a list of corporates in process of settling their operations from the aforementioned activities, globally, there are 15 companies that represent an investment potential higher than one thousand 104 million dollars and that could generate 6,437 formal jobs located in different areas of the State.

Among the cities that are being considered as ideal for the settling of these companies are: Reynosa, Matamoros, Nuevo Laredo, Altamira, Ciudad Victoria, El Mante, Villa de Casas and Llera.

The origin of capital of those projects belong to investors from the United States, Spain, South Korea, Venezuela, India, United Kingdom and also a resource of the Mexican private initiative.

Grupo Rio San Juan

Soraya Young, marketing director of Grupo Rio San Juan, said that 2018 was a very good year for Reynosa, as to the third quarter of the year it closed with 1 million 400 thousand square feet of absorbed space.

“One of the largest expansions was the one of the company BBB Industries with almost 450 thousand square feet; while in 2017 one of the largest growth projects was of the company Corning with half million.  These companies are already installed and thanks to their success they are willing to continue growing in Reynosa,” said Soraya Young.

Index Nuevo Laredo, opportunity areas

Guillermo Fernandez de Jauregui, president of Index Nuevo Laredo, said about what is expected for the industry in Nuevo Laredo in 2019: “I believe that with the Agreement mostly arranged or renegotiated, will provide us enough certainty.  In some way this was stopping us as country to have an more accelerated growth and with that I think investments will flow, this besides what is seen regarding the commercial war between the United States and China, and due to this an important amount of Chinese investments are coming to Mexico, thus I believe we will be living moved and interesting times, therefore we have to be prepared in order to this growth wave generates in fact the economic development we want for our country and our regions.”

He added that Index Nuevo Laredo is in charge of improving the already settled industry’s business conditions, this association has worked hard with committees that integrate it, but mainly focusing in human development; area that will provide competitiveness, as well as the issue of safety and environment, which will allow having a sustainable development.

“As industry, we have to be focused in these two schemes to have a lasting growth in the future, in addition of developing our people and take care of our environment,” said Guillermo Fernandez de Jauregui.

Index Matamoros

Rolando Gonzalez Barron, president of Index Matamoros, said that the maquila industry in Mexico is very important specially in the border due to this region is the main job source, as well as the main economy source.  The country in fact is very attractive for foreign investment not only for the facilities it offers to foreign companies to settle, but for their geographical location, their proximity with the United States and its high-quality workforce.

Currently in Matamoros, the maquila industry is stable and continuously growing, the Center for Innovation, Research and Technological Development recently opened by Index Matamoros, will benefit the maquila industry, since it will support this sector in innovation and technology introduction for the transition to Industry 4.0 which will be one of the main challenges for the industry in Matamoros for 2019, trying to introduce the highest number of companies to this area which is Industry 4.0.

“For 2019 we anticipate a higher growth with the arrival or more companies, as well as the strengthening and consolidation of the industry.”

Meanwhile, Index Matamoros will support the industry through its Research Center, by training personnel from maquila companies and students from different universities in the city,” noted Rolando Gonzalez.

Index Reynosa

Enrique Castron Septien, president of Index Reynosa, said that perspectives for 2019 are good and positive things are coming for the industry in this city.  “More work is coming, we will have a work demand of more than 14 thousand jobs in Reynosa; we need prepared, trained people and that is what we are working with the Government of the State of Tamaulipas, with the municipality of Reynosa and with McAllen, TX., aiming to develop young people, attract them and that they can enter into the technological flow developed in companies with the implementation of processes from Industry 4.0.

Will new companies arrive?

Enrique Castro answered yes to this question, and it is precisely due to this changing situation that many companies from Asia and Europe will be looking to Reynosa and the border in general for the opportunity to settle.

“Reynosa has been a city that, during hard times, as in the 90’s, then in the 2000’s; while many other cities lose, we grew and I believe that is the attitude and the way of work closely with McAllen, Mission and Pharr, in Texas, this allow us having attractive conditions to continue developing,” said Castro.

“I believe that the new administration is seeing the importance and knowing a sector which is a pillar for our economy, for our society; the power of having economic and social stability in Reynosa is important, and therefore we have been actively working to achieve this,” said Enrique Castro.