Manufacturers have been moving to "twin plant" assembly operations, which allow US businesses to ship materials over the border to a manufacturing plant. Once in Mexico the manufacturing plant there will construct the materials into a finished product, and ships it to the US plant for final shipment to the retail market. Mexico, being the first country with a commercial treaty signed with the major markets of the world, offers a unique opportunity. They have low operating cost proximity with the US skilled workforce, high employee productivity and top quality of life. Mexico has become the crossroads of the global economic activity. .
Mexico's Economic Overview .
Mexico has a free market economy. State-owned enterprises in Mexico have fallen from more than 1,000 in 1982 fewer than 200 in 1999. Inflation in December 2000 was down to 9.5%. Economists believe that these economic situations are a signal of a good environment for business opportunity. For the last year and a half the dollar exchange rate has been stable at approximately 9.5, the GDP per capita was approximately $4,300 and grew at a rate of7.0% during the year 2000. Economists consider that the Mexican peso is overvalued. .
COMPETITION IN MEXICO.
Bottled water is Mexico's highest consumed ready to drink beverage. Bottled water has grown to be so popular that Mexico's is the world's biggest water market, consuming about 4 billion gallons. Even though Mexico may be the world's largest bottled water market, the Mexican water industry has yet to consolidate and modernize. Mexico's bottled water market is far from being a cohesive industry. Mexico's bottled water market is best described as being a reaction to the nations historically poor quality and its difficult terrain. .
The consistent growth of Mexico's bottled water offers opportunities for suppliers eager to profit from the industry's ongoing consolidation to explain the strong regional focus of the water industry in Mexico, there are two major developments: .