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.
At the end of last year (2009) commerce between the two countries was over three times what it was in 1999. The Trade Balance between Mexico and Finland is shown in Exhibit 1.
The Trade Balance between Mexico and Finland reveals that during the period from January 1999 to December 2009, total exports from Mexico to Finland grew over 40 times. Also, imports to Mexico from Finland showed an outstanding 62.54% growth rate during the same period.
Reciprocal actions brought in US$815 million during 2009 in business between the two countries. Compared with the previous year, in 2008 total commerce between Mexico and Finland retreated for the first time in over a decade. During this interim, statistics recorded a 21% decrease in total commerce between the two partners.
Currently there are 37 Finnish subsidiaries in Mexico. This ranks Mexico as the second most important destination for Finnish production among the Latin, Central and South American Countries, coming in just behind Brazil.
The Foreign Direct Investment from Finland in Mexico re???? ects the following results. There are 12 Finnish companies in the manufacturing industry; 10 provide services; 7 are dedicated to commerce and one is in mining and extraction.
Obviously, Finland is an important major investor in Mexico. Finland’s top investors include Nokia, Luvata and Kone.
Nokia is a pioneer in mobile telecommunications and is an important producer of mobile electronic devices worldwide. Nokia´s Plant in Reynosa is one of the nine manufacturing facilities that Nokia operates worldwide. At this plant, Nokia prepares electronic devices for export to 20 different countries. Nokia is the largest export Maquiladora in northern Mexico and the sixth largest nationwide.
At their Reynosa Facility Nokia employs over 3,200 people in order to produce 55 different models and their operation includes the program “Take Quality Personally”. This is a knowledge-building plan a for the Nokia Reynosa labor force.
Luvata is the leading manufacturer of tubes, coils and coolers for the heating, ventilation, air-conditioning and refrigeration (HVAC) industry. Recently they announced the official opening of a multimillion dollar copper-tube manufacturing plant in Monterrey, Nuevo Leon. The new facility, within close proximity to several key customers, will focus on delivering fast and frequent orders of copper tubing to both large OEM manufacturers and smaller local customers in the air-conditioning and heating industry.
This new installation includes 180,000 square feet for the operation of the plant and almost 6,000 square feet for office space. This new Luvata plant has been designed to complement their operations in Franklin, Kentucky, and to serve as a strategic production point for their clients in the Mexican and U.S. Markets.
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-todate technology while provisioning diverse industries as well as providing maintenance and services required for automated gates.
Exhibit 2 shows Finnish Investment in Mexico. During the period from January, 1999 through March, 2009 companies with capital from Finland invested an estimated US$561 million.
The distribution of economic sectors in mexico benefited by Finnish investment during period beginning in January 1999 until March 2009, points to resources going mostly into the manufacturing industry (59.9%); next is other services with (38.5%). Exhibit 3 shows the distribution of Finnish investment in Mexico by sectors.