Exploring Mexico's Market: An In-Depth PESTLE Analysis

This report provides a PESTLE analysis of Mexico as an emerging market, examining the political, economic, social, technological, legal, and environmental factors influencing its development. It highlights Mexico's constitutional framework, economic indicators such as GDP growth and sector contributions, social aspects including population and religious demographics, technological infrastructure, legal regulations impacting business, and environmental commitments. The analysis references various sources to support its findings, offering a comprehensive overview of the opportunities and challenges within the Mexican market.

Emerging markets

Contents
Contents...........................................................................................................................................2
BACKGROUND OF EMERGING MARKETS.............................................................................1
MEXICO EMERGING MARKET..................................................................................................1
MAIN BODY..................................................................................................................................2
PESTLE ANALYSIS..................................................................................................................2
REFERENCES................................................................................................................................4

BACKGROUND OF EMERGING MARKETS
Emerging markets operating in growing finance sector marketplaces typically confront
numerous obstacles that harm both their survival and expansion (Bačík, Štefko and Gburová,
2014). The difficulties typically include intellectual finances, external conditions, revenue or
finance administration, technologies, finances, and governmental laws. Emerging markets (or
emerging countries or emerging economies) are markets that have some characteristics of
developed markets but do not fully meet their criteria. This includes markets that have the
potential to become developed markets in the future or developed markets. The term "frontier
markets" is used for developing countries with smaller, riskier or less liquid capital markets than
"emerging markets". Such criteria have included the firm's yearly revenues, personnel count, and
total holdings. In order to assess their company's development chances, companies plan to
expand their operations in developing regions (Clow and James, 2013). Fiscally sound
businesses enter overseas marketplaces thus they could expand their products and boost
revenues. While joining the marketplace, the connected institution must conduct extremely
serious analysis in this situation. Since there are different industry prospects, the company may
also confront difficulties (Cooper, 2012).
MEXICO EMERGING MARKET
Mexico is a nation in the northern part of the America, formally known as the United
Mexican States. The territory is the 13th largest autonomous country in the globe and
approximately 2,000,000 square kilometres (770,000 square miles) in size, making it the sixth
biggest region in the Americas overall. Mexico, the second-most populated state in North
America after Brazil, with an approximate total of about 129 million, ranking it as the tenth most
populated state in the globe and the largest Spanish-speaking state. A confederation, Mexico is
made up of 31 countries including Mexico City. Other major cities in the nation including Leon,
Guanajuato, Veracruz, Toluca, Jalisco, and Diego. Thus Mexico is one of the most important
emerging economies and can be benefitted by all of its factors that add to its value in the current
market scenario (Deb, 2020).

MAIN BODY
PESTLE ANALYSIS
 POLITICAL- The 1917 Constitutional established the United Mexican States as a
confederation with a presidency system-based representational, liberal, and republicans
administration. Several of these characteristics are a result of Mexico's history of
aristocracy, elite class centralization and autocratic leadership. The geographical position
of Mexico has been a major factor in the growth of the nation's involvement in organised
criminality and narcotics smuggling (Desai, 2013).
 ECONOMIC- The economy of Mexico is diversified, consisting of both commercially
held and government-owned businesses. As of May 2020, Mexico had the 15th-largest
nominal GDP ($1.15 trillion) and the 11th-largest by buying market equivalency ($2.45
trillion), both of which are governed by the administration. In 2016 and 2017, the GDP
grew on averaged by 2.9% and 2%, respectively (Fırat, 2013). Mexico's GDP in PPP per
capita was US$18,714.05. Over the past 20 years, agricultural has made up 4% of the
sector, whilst manufacturing has contributed 33% (mainly from the automobile,
petroleum, and technology industries) and activities have contributed 63%.
 SOCIAL- Mexico is the second largest populated state in North America following Brazil,
and Spanish is the national dialect of the state. Spanish was introduced to Mexico in the
fifteenth century. Roman Christianity was identified as the predominant religious belief in
the 2010 United States census by the National Institute of Statistics and Geographic
location, accounting for 83% of the inhabitants (Jones and Rowley, 2011). The remaining
10% (10,924,103) of the inhabitants are representatives of other Christian religious sects,
together with Evangelicals (5%), Pentecostals (1.6%), other Protestant or Reformed (0.7%),
Jehovah's Witnesses (1.4%), Seventh-day Adventists (0.6%), and representatives of The
Church of Jesus Christ of Latter- Less than 0.2% of the overall, or 172,891, were members
of non-Christian faiths; 4.7% said they had no faith; and 2.7% were undetermined (Kruger,
Saayman and Hull, 2019).
 TECHNOLOGICAL- Mexico has a vast transportation system that connects all of the
nation's regions. Mexico does have the greatest constructed transit system in North
America with a total length of 366,095 kilometres (227,481 mi), 116,802 km (72,577 mi)
of which are cemented. 10,474 km (6,508 mi) of them are interstate freeways with

multiple vehicles; 9,544 km (5,930 km) are four-lane roads; while the remaining
distances have six carriageways or over. National Council of Power and Pemex, two
state-owned businesses, are in charge of managing power generation in Mexico. Among
the biggest corporations in the globe by income, Pemex generates US$86 billion in
earnings annually and is responsible for the research, production, delivery, and selling of
raw gasoline and domestic energy in addition to the processing and delivery of
hydrocarbon derivatives and hydrocarbons. With 3.7 million gallons each day produced,
Mexico is the sixth-largest petroleum exporter in the globe. Petroleum shipments made
up 61.6% of all sales in 1980 but only 7.3% in 2000 (Lalicic and Weber-Sabil, 2019).
 LEGAL- A partnership is deemed global if the parties concerned are incorporated in
various nations or have fixed addresses there, or if the agreement involves direct
interactions with much more than one country (Lusch and Vargo, 2014). A
commissioners chosen by the Mexican government heads COFEPRIS, a decentralised
and independent organisation that oversees the production, purchase, and exporting of
healthcare goods as well as the management of healthcare institutions. Unfortunately, the
existing legislation doesn't really specify compensating obligations for air quality (LI,
2017).
 ENVIRONMENTAL- Companies thinking about locating their industrial operations in
Mexico must be well equipped on the ecological laws of the nation. This is particularly
crucial in light of the significant actions Mexico has undertaken to lessen its ecological
consequences and battle global warming (Nhamo, 2020). According to Bloomberg News,
Mexico vowed to decrease greenhouse gas footprints by 25% by 2030, making it the
initial emerging region to legally commit to reducing pollutants linked to global
warming. The Mexican administration places a high priority on ecological preservation,
therefore Mexican producers would be prudent to keep up with changing laws. All causes
of air pollution are subject to regulation by Mexican ecological legislation. Furthermore,
irrespective of the city wherein they are situated, a lot of industrial locations would fall
under government control. As a result, every fixed cause of air pollutants (like a plant)
needs to get an environmental operational licence (Tasci, 2020).

REFERENCES
Books and journals
Bačík, R., Štefko, R. and Gburová, J., 2014. Marketing pricing strategy as part of competitive
advantage retailers. Journal of applied economic sciences. 9(4). p.30.
Clow, K. E. and James, K. E., 2013. Essentials of marketing research: Putting research into
practice. Sage.
Cooper, C., 2012. Essentials of tourism. Pearson Financial Times/Prentice Hall.
Deb, S. K., 2020. Evaluation of Mobile Applications in eTourism: an Innovative Outlook.
International Journal of Recent Technology and Engineering.
Desai, S. S., 2013. An analysis of the competitive marketing strategies of the hospitality industry
in UAE. IUP Journal of Management Research. 12(1). p.22.
Fırat, A. F., 2013. Marketing: culture institutionalized. Journal of Macromarketing. 33(1). pp.78-
82.Joshi, M., 2012. Essentials of marketing. Bookboon.
Jones, R. and Rowley, J., 2011. Entrepreneurial marketing in small businesses: A conceptual
exploration. International Small Business Journal. 29(1). pp.25-36.
Kruger, M., Saayman, M. and Hull, J., 2019. A motivation-based typology for natural event
attendees. Journal of policy research in tourism, leisure and events. 11(1). pp.35-53.
Lalicic, L. and Weber-Sabil, J., 2019. Stakeholder engagement in sustainable tourism planning
through serious gaming. Tourism Geographies. pp.1-21.
LI, H. L., 2017. Multi-dimensional Issue of Tourists’ Motivation and Perceived Value in
Predicting Behavioral Intention: Satisfaction as a Mediator. DEStech Transactions on
Social Science, Education and Human Science, (icssd).
Lusch, R.F. and Vargo, S.L., 2014. The service-dominant logic of marketing: Dialog, debate,
and directions. Routledge.
Nhamo, G., 2020. Counting the Cost of COVID-19 on the Global Tourism Industry. Springer
Nature.
Ar, A.Y. and Abbas, A., 2022. Corporate social responsibility projects to supports multinational
enterprises' reputation building efforts in Mexico. Journal of Public Affairs, 22(2),
p.e2495.