Lack of clear rules, insecurity and impunity make Mexico unattractive for investment: CEESP

An environment without clear rules, with insecurity and high impunity inhibit business investment in Mexico, warned the Center for Economic Studies of the Private Sector (CEESP).

“A business environment without clear rules is clearly not attractive to invest” for foreign companies, which have been attracted by nearshoring, stated the advisory body of the Business Coordinating Council (CCE).

The organization stated that there still persists an environment of insecurity and high impunity with a weakened rule of law that generates high levels of concern among those interested in making investments.

Today in Mexico almost two thirds of the population over 18 years of age feels insecure living in their city, the private entity recalled.

“The black figure, in other words, the total number of crimes that are not reported or an investigation file is not initiated, is 93 percent and that 7 of the 10 most dangerous cities in the world are in Mexico, are issues that are seriously considered by those who wish to invest in the country, attracted by nearshoring,” said the economic analysis institute.

It added that expectations regarding economic activity continue to deteriorate in the face of an environment that limits a better performance of the productive apparatus, affecting the dynamics of employment and consumption.

Uncertainty over the U.S. trade policy is growing due to the concern that beyond the tariff consequences for the countries involved, it could result in a trade war that affects the world economy, detailed the CEESP.

It added that the response of the Mexican authorities will have to be very careful, since they will have to respond in the same way.

“With the application of reciprocal tariffs, it could affect various sectors of the Mexican productive apparatus,” it said.

Mexico imports a significant volume of goods to produce exports and domestic goods that could be seriously affected, affecting final prices,

According to Inegi figures, consumer and business executives' confidence indicators, especially the latter, have already accumulated several months with a negative behavior, especially in terms of their opinion regarding the country's future situation.