Upside risk is presented to our growth forecasts for two Mexican ports, Altamira and Tampico, as the state government for Tamaulipas has announced a massive forthcoming investment in the facilities. The investment will not only focus on the ports themselves but also their connecting infrastructure. This highlights that, while the central Mexican states are set for an economic boom, as they attract robust manufacturing sector-driven growth through improved transport links and incentive programmes, the northern states continue to invest as well, and will likely continue to attract the bulk of FDI inflows.
According to a press release from the government of the northern Mexican state of Tamaulipas, the Mexican transport and communications authority, SCT, is to invest MXN5.5bn (US$454mn) over the next three years in the state ports of Altamira, Tampico and Matamoros. The largest project will be the modernisation of the port of Matamoros, which will cost MXN1.5bn, and was one of President Nieto's campaign pledges. In Altamira work will include dredging to ensure a deeper draught capable of handling larger vessels, and new intermodal connections. These will take the form of a new railway line, new access roads and a new underpass.
|Port of Altamira TEU Throughput, 2008-2017|
These investments will provide upside risk to our medium-term (2013 to 2017) growth forecasts for the ports of Tampico and Altamira. Tampico has seen a huge reduction in its box handling in recent years, falling from 11,152 twenty-foot equivalent units (TEUs) in 2008 to just 447 in 2012. Our medium-term forecast currently averages 7.0% a year, so even with the upside risk from these investments it is doubtful that previous volumes will be recaptured. At Altamira, however, 2012 saw 578,685TEUs, a record volume of boxes, handled at the port, and in 2013 we forecast throughput of 603,728TEUs. Growth over the medium term is to average 11.0%, with significant upside from the improved intermodal links.
We expect the ports to enjoy strong growth as they continue to benefit from both the recovering US economy and a growing domestic consumer base. The bulk of manufacturing in Mexico continues to be in the north, and these ports will be key in bringing in goods bound for the US market. This will either be through the import of spare parts for finished products made in Mexico and exported to the northern neighbour, or simply through re-exports. The city of Matamoros lies directly on the US border, and the development of its port will enable shippers to avoid US harbour tax while still avoiding lengthy transport times from other more southerly ports.
|Federal District And North Dominate|
|Mexico - FDI By Region 2000-2012, %|
BMI has highlighted that the central Mexican states are set for an economic boom as they attract more industries, in particular related to the automobiles sector, through incentive packages and their improved transport links - namely port and rail developments ( see 'Central American States Set For An Economic Boom', April 3 2012). While we continue to see this developing, this announcement highlights how the northern states of the country also continue to improve their transport links, and therefore their attractiveness to business. As a result the north will remain the key recipient of FDI after the Federal District around the capital. From 2000 to 2012, Tamaulipas itself was the eighth-largest recipient of FDI inflows in Mexico.