The Argentina-based e-commerce company Mercado Libre said on Tuesday it will invest US $1.1 billion to grow its storage and service capacity in Mexico this year, propelled by a boom in online purchases during the coronavirus pandemic.

It will be the company’s second biggest investment after Brazil and its biggest in four years.

The figure is almost triple the amount the company invested last year in Mexico, a rapidly growing market in which global rivals such as Amazon want to expand.

The investment will help Mercado Libre double its storage space and drive its fintech services like consumer credit. The expansion will create more than 4,700 jobs.

In the fourth quarter of 2020 Mexico surpassed Argentina, the company’s local market, in terms of items sold. It has continually grown its delivery network, recently opening a fourth distribution center, a 60,000-square-meter site in Nuevo León.

At the end of last year, the company operated 210,000 meters of storage space, principally on the outskirts of Mexico City.

During the announcement, Marcos Galperín, founder and CEO of Mercado Libre, said the investment is a demonstration of the enormous opportunity that Mexico represents for his company. “We hope to grow in Mexico for many years to come,” he said.

However, economic recovery will only be possible if the labor and financial capital is available to enable transactions between sellers and buyers, warned David Geisen, head of Mercado Libre’s Mexican unit.

He added that during the pandemic, seven of 10 sales by small and medium-sized businesses were digital and of those, 50% were made through Mercado Libre.

“Growth in 2021 will be double digit, not triple digit like in 2020, but we will see increments at pre-pandemic levels,” Geisen predicted, without divulging exact figures.

Source: Milenio (sp)