Export sector, the engine of the economy in 2021: Caintra

MEXICO – With the accelerated vaccination process in the United States and a downward trend in unemployment, the drag that this country will have on Mexico’s exports to this market will most likely extend throughout the year, consolidating sales abroad as the engine of Mexico’s economy in 2021, pointed out the Chamber of Industry of the Transformation of Nuevo León (Caintra).

“Manufacturing exports are of great relevance to the country’s economy, which represent 36% of the country’s GDP. In addition, they are an important point in the value chain, linking large companies and SMEs with their counterparts in other countries. They also represent high value jobs,” explained the organization.

It indicated that the expectation is that exports will allow a growth of the industrial sector in the country during 2021 of around 4.9%, after having contracted 10.2% in 2020.

The organization explained that with the production figures for the first months of this year seem to show some sectors that will stand out in 2021 for their dynamism and drive over the rest of the activities.

Among these, the country’s manufacturing exports stand out, which in the first month of the year show an increase of 4.9% compared to the start of 2020.

“The performance of exports is the result of the growth dynamics in the United States, where manufacturing orders are expanding and its economy grew 4.1% in the last quarter,” explained Caintra.

However, the organization clarified that due to the nature of the export sector, it is currently facing short-term risks such as uncertainty in global markets, outbreaks of the pandemic, volatility in the exchange rate and international prices of inputs.

An uncertain national and international outlook would complicate activity in this sector and, therefore, would cause a slowdown in this growth.

“For this reason, it is essential to guarantee optimal conditions in the interior of the country for the best performance of the export industry and promote the economic recovery of Mexico,” said the agency.

Also, Caintra called on the authorities to facilitate the exchange of merchandise abroad.

“Among the points that we consider crucial are: simplifying and speeding up the procedures for the export of goods, as well as speeding up the VAT refund of exporting companies; guarantee the operation of companies with a constant and efficient supply of electricity and gas. Without these inputs, the activity stops and, with it, exports. In addition, SMEs should be supported to insert themselves into global value chains, through financing and advice on digitization and process optimization processes,” said the organization.

Source: El Economista