Mexico’s natural beauty continues to awe the world. From breathtaking mountains to gorgeous beaches to adventures jungles it is like one country which has it all. Tourism plays a pivotal role in the economy of the country. But with times changing, the other important sector of the country is now getting its due recognition.
 
For instance the stock market of the country is the second-best performing major market in the world so far this year, lagging only Germany’s. The benchmark IPC index has raised 23.6 per cent in U.S.-dollar terms. Investors are now convinced that nothing can derail Mexico’s economic growth.

“This is a market that was dead in the water for a long time,” said Scott Piper, portfolio manager of Excel Funds Management Inc.’s Latin America Fund. Now, he said, “we’re seeing capital markets expanding, the number of [listed companies] increasing. We think that [the proposed reforms] are structural long-term positives for the market.”

The manufacturing sector is booming and they can now give competition to Asian countries. The market pro government with its reforms has led to bigger gains for the Mexican economy and for investors. A series of reforms to the country’s financial and labor markets has provided further fuel for Mexico’s economy.

President-elect Enrique Peña Nieto is aware of the impact of market on the economy. Therefore the he and his party is formulating policies that would facilitate labor measures such as hourly wages instead of daily rates and loosen rules on hiring and firing. Thoughts are being pondered over tax collection system for increased revenue and privatization in Mexico’s energy sector.

These reforms when implemented will position Mexico as Latin America’s biggest economy by 2022, according to a Nomura Emerging Markets Research report. “We believe that, over time, capital will likely flow much more efficiently to Mexico than Brazil,” said Benito Berber, Nomura’s senior Latin America strategist and co-author of the report.

The recent reforms have been crucial is creating a domestic base of buyers, according to Adam Kutas, who manages Fidelity Investments Canada ULC’s Latin America fund. “That’s very positive” for the country’s investing environment, he said.
 
The financial market reforms, passed in 2009 and 2010, saw Mexico’s first real estate investment trust come to market, and introduced structured equity securities called CKDs that are intended for heavy investments from pension funds.

“Mexico is the natural stop for risk-averse investors if they want to get into emerging markets,” says William Landers, senior portfolio manager of BlackRock Inc.’s Latin American equity funds.

Mexican wireless giant America Movil is also listed on the NYSE, making up about 10 per cent of Fidelity’s Latin America Fund portfolio. “Mexicans are very early adopters of smartphone tech and smartphone use,” Mr. Kutas says, particularly because of their young demographic.

Properties in Mexico offer great amenities and luxuries at a great value. XL fund manager Mr. Piper believes real estate is a wise investment. “We think property values will continue to gain over time,” he said. Great price, amazing location and blissful living makes the country a wonderful place to live in.

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