Mexican Total Entrepreneurial
Activity for 2003 = 12.4%
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World Average TEA 9.6
N. American Average TEA 11.1
Entrepreneurs
in Mexico
The GEM report 2002 finds that 18% of Mexicans are involved
in entrepreneur activities, the highest number of any
of the 29 countries covered in the study. They rank second
worldwide in “opportunity’ entrepreneurship
and fourth in “necessity” entrepreneurship.
Entrepreneurship abounds in Mexico but is concentrated
among low risk, low value added endeavors that require
minimum investments of capital. Due to economic realities,
people are relatively unable to leave existing employment
to pursue high-value ventures. Due to the dearth of risk
capital, they select opportunities that can be tested
quickly and have relatively high success probabilities
and modest up-side potential with quick positive cash
flow. Also, non-transparent business practices in these
ventures make them unattractive to risk-averse investors.
Also, the lack of high quality, timely information on
markets, demographics, competitors, prices and costs hampers
the growth of entrepreneurs. The quality of financial
systems, venture capital, education and legal system needed
to support entrepreneurship lack in Mexico. The Government
permits and licenses needed to start a company are a major
hurdle to most entrepreneurs in Mexico.
Mexico's economy is one of the most open in the world
and, has the largest number of free trade agreements.
Mexico has built a network of free trade agreements with
32 countries and the most important of these agreements
are with the world's largest markets, such as NAFTA, the
agreement with the European Union, an agreement with Japan,
and other agreements with South and Central America. This
has put Mexico in ninth place in the world in terms of
the size of its economy, and seventh place in terms of
the size of the balance of trade. This sustained progress
has built an atmosphere of competition, conducive to innovation
and undergoing constant improvement. This sustained progress
(of the last two years) has allowed for better planned
regulations that enables more assured long-term planning.
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Mexico Connect
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Entrepreneurship
