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Foreign direct investment in Querétaro gains momentum

by | Apr 10, 2023

Foreign direct investment in Querétaro has become one of the most attractive options in the country for international manufacturers. Its strategic location, rule of law, quality of life, and stable labor environment are the main characteristics that distinguish it from its competitors.

This 2023, Querétaro started with 55 projects in its investment portfolio that will eventually generate about 23,894 jobs and represent an investment of approximately US $5.2 billion.

According to Marco Antonio del Prete Tercero, Secretary of Sustainable Development of the State, for foreign direct investment in Querétaro, “the first things that we offer include a safe environment characterized by the rule of law, a superior quality of life, and economic competitiveness.”

Querétaro keeps its promises

“A state that fulfills what it offers and promises” distinguishes Querétaro from others. It delivers security, education, competitiveness, and health. These are things that are critical to promoting foreign direct investment in Querétaro.

Efforts to attract investment are oriented towards training support, job creation, and infrastructure development, which represent a stimulus for the companies to decide to establish operations in Querétaro.

In direct foreign investment in Querétaro, from January to September 2022, the state attracted US $764 million. This is an increase in the growth rate of almost 11% annually, with the United States being the leading investor. The countries that followed the US were France, Canada, and Japan. Of the total, nearly 60% of the foreign direct investment corresponds to reinvestments, which indicates that companies based in the state continue to bet on developing their projects, he maintained.

According to data from the Secretariat of Sustainable Development (Sedesu), in 2022, 47 projects were completed and, in the medium term, will generate 13,996 jobs. They represent a foreign direct investment in Querétaro of USD 1.4 billion.

As part of this investment attraction strategy, proactive promotion is essential. Therefore, the state participates in foreign tours, trade fairs, and commercial exhibitions in Canada, Germany, the United States, and the United Kingdom.

Foreign direct investment in Querétaro requires a solid infrastructure

Infrastructure also plays a vital role in attracting foreign direct investment in Querétaro since “competitiveness is also measured in shorter times, greater vehicular flow accesses so that people and merchandise move efficiently and safely.”

And not only roads but also energy, water, and education are also important. “Everything is based on a developed infrastructure.”

Regarding industrial and business activity, Del Prete highlighted the network of clusters that the state has, which simultaneously form part of its economic growth strategy. For example, Querétaro’s primary industries include information technologies, aerospace, automotive, plastics, energy, logistics, and medical devices.

Regarding connectivity, he highlighted the Querétaro International Airport (AIQ), where the leading national airlines such as Aeroméxico, Volaris, Viva Aerobús, TAR, and international airlines such as United Airlines are present. In the same way, it has become a logistics hub in terms of cargo, mobilizing about 72,000 tons of cargo in 2022, nationally and internationally. In addition, firms such as DHL, UPS, FedEx, and Mercado Libre have a presence in Querétaro.

Mercado Libre has its air hub in the entity, which represents an investment of US $55 million, which was made in 2020.

Querétaro strives to attract advanced manufacturing companies with significant innovation and technology to add value to the economy in sectors such as data centers, industry 4.0 technologies, and the metaverse.

In recent years there has been a boom in data centers with foreign direct investment in Querétaro.  This makes it the state with the most megawatts installed in Mexico (48 MW). Companies such as Ascenty, Kio, Alestra, Equinix, Digital Reality, Odata, Triara, CloudHQ, and Huawei have a presence there.

Investors can have tremendous confidence in the state. For example, international rating agencies such as Standard and Poor’s and Moody’s give it the highest rating with an investment grade (BBB for a long-term issuer on a global scale and mxAA + on a national scale, both with stable prospects, by S&P and Baa2 with Moody’s stable outlook).

Querétaro has positioned itself internationally among the Latin American cities of the future. According to fDi Intelligence, it is the second most desirable destination for companies to invest in Mexico.  According to KPMG it is the fourth state with the best performance and competitiveness at the national level.  It also is recognized as being in fourth place for the most sustainable societies, by the Center for Economic Research and Teaching (CIDE).

Companies can draw on a growing population

Today, Querétaro has 2,368,000 inhabitants and is positioned as the Mexican entity with the second-highest growth rate in its population compared to 2010. “In 30 years, the population doubled, an important fact that has allowed us to continue growing and developing the economy,” Del Prete said. From 2010 to 2020, there was a growth of 2.7% in the number of inhabitants, the exact figure registered from 2000 to 2010.

The average age of the population of the state is 28 years. Therefore, Querétaro offers companies a young population that is essential for their growth and success. This makes the state attractive to invest in since it has a large and growing economically active population (EAP).

The EAP of Querétaro is numbered at 1,041,000 people. Although its unemployment rate is 5% on average, it is also one of the states with a high percentage of its economically active population formally employed, with 63 percent.

To deal with the unemployment rate, he commented, there are strategies in conjunction with other secretariats, such as Labor and Education, as well as with industry clusters to determine a common core of knowledge required for the state to prepare workers for jobs in industry.

Manufacturing is the sector that generates the most significant number of jobs, followed by services, commerce, and construction. As regards the latter, Querétaro is one of the preferred destinations for real estate investment in housing construction, industrial parks, and public works.

 

Contact LATAM FDI to discuss your foreign direct investment plans in Latin America.

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