Finland in Mexico

Political relations between Finland and Mexico are good and smooth. The main base of the relations between Mexico and Finland is trade and economic cooperation and there are good conditions for growth and diversification.

The interest of Finnish companies from Mexico has increased since Mexico became a member of the Free Trade Agreement with North America (NAFTA), which opened the entrance to the largest consumer market in the world. Also the Mexican domestic market is considerable. The agreement to avoid double taxation and investment protection has facilitated the bilateral trade flow.

As a result of the Free Trade Agreement signed between Mexico and the European Union back in 2000, both countries are now major commercial and investment partners in which Finland has taken advantage of a strategic position with Mexico.

The signing of this agreement reinforced Mexico as the first country with preferential access to the two largest markets in the world and in this way creating certainty and improvement in its strategic role in world trade.

Exhibit 1 summarizes the Trade Balance between Mexico and Finland. It shows that commerce between the two countries reached its maximum level in the year 2008. There was a decrease in the year in 2009, and things started recovering in a satisfactory way again in 2010. What really stands out is that since the year 2000 commerce between Mexico and Finland has been evolving very satisfactorily following a path of continuous growth, with the exception of the global recession timeframe. Several important factors in the trade balance between Mexico and Finland are revealing. Take, for instance, the fact that during the 13 year time span from January 1999 to December 2012, total exports from Mexico to Finland rose from US$12.78 million to US$100.21 million (+684%).

And at the same time, imports from Finland to Mexico also showed a 141% growth.

Total commerce between the two countries and reciprocal action brought in US$523.26 million during 2012 in trade between the two partners and showed important improvements. This has been especially the period since 2008. This was when, for the first and only time, the total commerce "stats" were available identifying the US$1 billion. In fact, the period 1999 to 2012 represents a 177% growth rate in total commerce between the two nations. And another interesting detail, in 2012 there was a 9.47% increase in commerce (US$523.26 million) compared with (US$477.99 million) in 2011.

Finland represents the 15th largest commercial partner with Mexico among the members of the European Union, and it accounts for 0.9% of total Mexican commerce with the EU.

Exhibit 2 shows Finnish Investment in Mexico. During the period from January 2000 through March 2013, companies with capital from Finland invested US$649.4 million. Finland ranks as the 12th investor among members of the European Union, representing 0.6% of the cumulative investment of 1999 to June 2012 and also ranks 23rd in respect of all nations investing in Mexico.

There are 38 companies with Finnish investment in Mexico. The main sectors with Finnish capital commercialized in Mexico are manufacture, services and commerce. Kone, Nokia, Luvata, KPC and Vaisala are among the Finnish Companies with important presence in Mexico and some of them are expanding their operations in the country.

Kone is a leading producer of elevators. This Finnish enterprise established operations in Matamoros so they could produce electric stairs along with elevators using the most up-to-date technology while provisioning diverse industries as well as providing maintenance and services required for automated gates.

Luvata Monterrey S. de R.L. de C.V. is one of Luvata's newest copper-tube manufacturing facilities. Located in the Monterrey area of Nuevo Leon Mexico, Luvata Monterrey focuses on delivering fast and frequent orders of copper tube to both large OEM manufacturers and smaller local customers in the air-conditioning and heating industry. Luvata also has a large facility in Ciudad Juarez which recently expanded to double its manufacturing plant space.