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2 Mexico is a large country, 1.95 m* 1.97 m* United Kingdom (0.24m*) France (0.67m*) Germany (0.36m*) Source: World Atlas (millions of squared meters) 1.65 m* Italy (0.30m*) Benelux (0.075m*)

3 highly populated (11th largest in the world) 125,000, ,000, ,000, ,000, ,000, ,000,000 95,000,000 Mexican Population Forecast 90,000,

4 In 2020 we will have the greatest demographic bonus in Mexican history Dependents for every 100 people Total Children Demographic Bonus Elderly Source: CONAPO: National Council of Population

5 The south of USA and the north of Mexico hold a population of 84 million ,844, Mexican Population 21 m Mexico City 8 m Los Angeles 512, ,024,238 Source: INEGI and U.S. Census Bureau

6 Source: International Monetary Fund 14th largest country in the world (GDP)

7 macroeconomic stability

8 Recent economic history through the eyes of inflation Mexican inflation since the 80 s Inflation of 4.4% in (e) GATT Source: International Monetary Fund, (e): estimate Central Bank Independence Tequila Crisis + NAFTA

9 healthy shift in govt s foreign debt profile, Figura 3: Deuda interna y externa (% de la deuda). Foreign vs. domestic debt (% of total) Figura pla Foreign Domestic Source: Mexican Ministry of Finance (SHCP)

10 reduction of debt and longer terms, not bad! la deuda). Figura 4: Deuda pública externa (% del PIB) y plazo promedio de vencimiento de los valores gubernamentales (días). Foreign public debt (% of GDP) vs. maturities (days) Foreign Public Debt Maturity Maturity * Third quarter Source: Mexican Ministry of Finance (SHCP) and Mexican Central Bank

11 historical levels of international reserves, and 140,000 International reserves (US$ million) 120, ,000 80,000 60,000 40,000 20,000 0 Jan-96 Jan-97 Jan-98 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Source: Mexican Central Bank

12 dic-00 dic-01 dic-02 dic-03 dic-04 dic-05 dic-06 dic-07 oct-08 we have enough cash to pay 3x our foreign, res). International Reserves / Foreign Debt (ratio) Figura 2: Reservas inter. / deuda externa del sector público e Source: Mexican Central Bank Fuente: SHCP

13 financial reforms have been incresing tax revenues Number of Tax Payers (millions) Source: Mexican Revenue and Customs (SAT)

14 a strong financial system is in place Bank s Capitalization Index ( Nov 2010, %) Source: Mexican Ministry of Finance

15 FX volatility similar to that othe Sept 2008 Sept Source: Reuters MX$ 2% -16% -2% -25% 24% -7%

16 low country risk compared to that of LatAm EMBI+ spreads (basis points) Source: Mexican Ministry of Finance

17 investment grade economic fundamentals Sovereign Risk Ratings Source: BBVA Bancomer

18 platform for industry

19 Source: AlixPartners and we offer the lowest operating cost for electronic projects and manufacturing

20 Transferring operations to Mexico can lead to important savings Source: United States Department of Labor and International Labor Organzation

21 strong R&D capabilities 90,000 engineers and technicians graduate every year 2,539 higher education Institutions 900 post-graduate engineering and technology programmes -Mexico invests 7% of GDP in education

22 our expertise: manufacturing, Principal exports, 2008 (US$ mm) Source: The Economist Intelligence Unit

23 the trend speaks for itself, Export volume (US$ billion) Source: Ministry of Economy

24 Source: Ministry of Transport and Communications (SCT)...Mexico is a logistics platform

25 although exports still dependent on the US, Main destinations of exports, 2008 (share of total) Source: The Economist Intelligence Unit

26 you can t disregard our unmatchable FTA network, Canada Islandia Noruega Dinamarca Suecia Finlandia India Corea del Sur Japon Guatemala Estados Unidos Cuba Honduras Nicaragua Reino Unido Irlanda Belgica Luxemburgo Suiza Alemania Holanda Estonia Latvia Lithuania Polonia Rep. Tcheca Slovakia Hungria Liechtenstein Eslovenia Costa Rica Romania Colombia El Salvador Panama Portugal Brasil España Italia Francia Austria Malta Israel Grecia Bulgaria Chipre Peru Australia Bolivia Uruguay FTAs with 44 countries Chile Argentina Source: Ministry of Economy

27 Source: World Bank, Doing Business Index we are simplifying processes

28 the world recognises Mexico s business appeal Doing Business Ranking 2011 Source: World Bank, Doing Business Index

29 and what we are doing to improve Doing Business Ranking (trend) Source: World Bank, Doing Business Index

30 In general, operation costs are very competitive Source: World Bank, Doing Business,

31 Source: World Bank, Doing Business, The simplicity of opening a business is favourable...

32 Source: World Bank, Doing Business, and so is the simplicity of closing it...

33 ... Mexico went up from number 11 places in the FDI Confidence Index Source: A.T. Kearney s FDI Confidence Index 2010

34 Source: Ministry of Economy and large FDI income

35 Source: Stocks markets in each Country Mexico is a profitable investment choice

36 therefore.

37 5/1/96 5/1/97 5/1/98 5/1/99 5/1/00 5/1/01 5/1/02 5/1/03 5/1/04 5/1/05 5/1/06 5/1/07 5/1/08 5/1/09 5/1/ Mexican inflation since the 80 s (e) Low inflation Fuente: SHCP. Figura 3: Deuda interna y externa (% de la deuda). Foreign vs. domestic debt (% of total) Foreign Domestic Internal financial market Figura 4: Deuda pública externa (% del PIB) y plazo promedio de vencimiento de los valores gubernamentales (días). 100,000 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Fuente: SHCP y Banxico. therefore International reserves (US$ mm) Historical reserves Export volume (US$ mm) Canada Islandia Noruega Dinamarca Suecia Finlandia India Corea del Sur Japon Guatemala Estados Unidos Cuba Honduras Reino Unido Irlanda Belgica Luxemburgo Alemania Holanda Estonia Latvia Lithuania Polonia Rep. Tcheca Slovakia Hungria Liechtenstein Nicaragua Suiza Eslovenia Costa Rica Romania El Salvador Colombia Portugal Panama España Brasil Italia Francia Austria Malta Israel Grecia Bulgaria Chipre Peru Australia Bolivia Uruguay FTAs with 44 countries Chile Argentina Manufacturing, not commodities FTA 44 countries Investment grade

38 Source: Goldman Sachs MEXICO HAS A HUGE POTENTIAL!

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