Saturday, May 31, 2025

Despite regulatory complexity, investment in Mexico remains high

Mexico ranks as the third most challenging country in the world to do business, according to the Global Business Complexity Index (GBCI) 2025, an annual ranking that evaluates the regulatory complexity of doing business in 79 countries that collectively account for 94% of global GDP.

The index, published by accounting group TMF Group, saw Mexico move up one position this year after it came in No. 4 last year. This consolidates its position as one of the most complex economies in terms of regulation, taxation, and administration.

Yet, this has not discouraged investments in the country.

In the report, TMF Group notes that, despite the volatile context, interest in Mexico remains undiminished. Many companies are not only maintaining their investment plans but are also investing in the long term.

“What we see most in our business is that investment continues unabated. It’s coming from the United States, Europe, and China, with companies determined to establish themselves here,” Dunia Salomón, managing director for TMF Group in Mexico, told Expansión magazine.

She said that the country attracts investment because of its strategic geographic location and its network of trade agreements, key to nearshoring. Despite the uncertain environment and recent reforms in labor and judicial matters, Mexico remains open to the public.

“It has challenges, but it hasn’t stopped being competitive,” adds Dunia Salomón.

The increased complexity of doing business in Mexico is due to multiple factors, Salomón said. One is that  there is also a lack of uniformity in the application of regulations: one office may require five requirements, while another may require six for the same permit. Digitalization is advancing, but it has not yet completely replaced in-person procedures. This creates bottlenecks, especially after the pandemic, when demand increased and operational capacity had not fully recovered.

Mexico also lost ground compared to other countries on the ranking, which made faster progress in simplifying their regulatory processes.

Meanwhile, TMF Group notes that the main challenge isn’t the complexity itself, but rather the uncertainty surrounding some processes and the ambiguous interpretation of certain rules.

Salomón thinks that for investors, “the key is to have a clear action plan and surround themselves with experts who understand the local environment.”

“The country is attractive, but it requires preparation. It’s not enough to apply the same formula as in other jurisdictions. Here, you need local advice, patience, and knowledge. That’s the difference between successful expansion and failure,” says Salomón.

As part of Plan Mexico and to boost investment, the government created the National Digital Investment Window, which provides guidance and support for foreign companies. TMF’s general director in Mexico said that the results of this initiative would be reflected between 2026 and 2027. By then, Mexico should show progress in simplifying procedures and reducing administrative barriers. If it manages to implement these measures, it could move down the ranking of the complexity of doing business.

With reports from Expansión

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