Mexico Opens Up Energy Sector: Great News.

Added on by Arturo Gutierrez.

This is from last week but President Peña Nieto's announcement on his plans to change the consitution to allow foreign investment is wonderful news. Consider it the second most significant piece of possible legislation since NAFTA in 1994 for Mexico. Opening up the energy sector to foreign investment may have it's detractors, but this is one move that requires little effort to articulate how important it will be for the country. A country, mind you, that has seen tremendous growth from NAFTA alone without loosening the grips on markets traditionally dominated by government sponsored monopolies. 

You need only look at World Bank data to awknowledge how far central america (And Mexico) has come. Sustained economic growth and middle class mobility of 50% over the past decade are indicators of growth. Again, this is happening in countries that have been traditionally closed to foreign investment in government controlled sectors. 

I'm excited for the economic growth that loosing the grips can bring. Exxon Mobile and Royal Dutch Shell are lining up to find new sources of petroleum and Mexico could benefit from billions of dollars pumped into it's economy. But this is about more than economic growth and jobs. It's about a considerable step forward into becoming an open nation socially as well to foreign countries. And if China's recent acquisition streak of natural resource, telecom, and infrastrcture companies in the US is any indication of far east interest in the west, expect to see them heading south as well. 

 

- arturo gutierrez