Valeria Moy, Director General of the Mexican Institute for Competitiveness (IMCO), has delivered a stern assessment of Mexico’s current economic standing, warning that while the country is uniquely positioned to benefit from global supply chain shifts, structural failures—particularly in the energy sector—threaten to undermine its potential. Speaking to international stakeholders at Nordic Day in Mexico City, Moy outlined a blueprint for long-term prosperity that balances the promise of nearshoring with the reality of domestic policy hurdles.
The Nearshoring Pivot and Economic Indicators
Mexico currently holds the title of the world’s 13th-largest economy, valued at US$2.12 trillion. While government aspirations aim to reach the top 10, Moy emphasized that true economic success must be measured by GDP per capita rather than aggregate size. Reflecting on the aftermath of the 2020 pandemic—which triggered the most significant economic contraction since 1932—Moy noted that the country’s recovery was slow, only hitting pre-pandemic benchmarks in 2023.
However, the outlook is shifting. After a period of skepticism regarding “nearshoring,” Moy now believes the phenomenon is tangible. With a massive network of 52 trade agreements and highly favorable average tariff rates with the United States, Mexico is geographically and commercially primed for industrial growth. “Global reconfiguration will allow us to have everything necessary to achieve it,” she stated, noting that the window of opportunity is wide open for partners looking to diversify away from traditional manufacturing hubs.
Energy Vulnerability: The Critical Bottleneck
Despite the optimistic trade data, Moy identified a glaring weakness: the energy sector. She characterized the sector as being in a state of severe decline, with electricity, gas, and water production values sitting 33% lower than they were in 2018. This underinvestment is not just a fiscal statistic; it is a direct threat to national stability and operational continuity.
Moy warned that the risk of power grid instability is an immediate deterrent to foreign direct investment. To remain competitive, she urged the current administration to abandon the status quo and accelerate energy project deployment with urgency. Without a reliable, sustainable, and modern energy infrastructure, the “nearshoring” dream remains fragile, as multinational firms prioritize markets that guarantee energy security over those that provide cheap but intermittent power.
Strategies for Sustained Growth
To move from potential to performance, Moy outlined four pillars essential for the Mexican economy to evolve:
- Internal Certainty: While external geopolitical factors like potential US tariff adjustments remain a constant threat, Moy argued that internal regulatory certainty is the variable under Mexico’s direct control. Investors need to be confident that the “rules of the game” will not be retroactively changed.
- Innovation over Volume: Mexico is successfully churning out high volumes of engineering graduates, but this talent must be converted into intellectual property. Translating engineering output into registered patents is the next frontier for domestic competitiveness.
- Harnessing Renewable Potential: Moy noted that Mexico possesses immense, underutilized natural potential for renewable energy, which could serve as a unique competitive advantage if properly tapped.
- Collaborative Alignment: The success of the “Mexican ship” depends on a unified effort across government, academia, and the private sector.
While recent data shows a reversal in negative investment trends—with surveys indicating that business sentiment is slowly improving—Moy maintained that long-term success requires sustained effort. As investment targets climb toward a goal of 28% of GDP by 2030, the ability of the administration to provide clarity and infrastructure will define whether Mexico solidifies its role in the new global economy or misses the moment entirely.
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