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Leuthard targets business hurdles in Mexico

Doris Leuthard talks to Mexican Economic Minister Eduardo Sojo

(Keystone)

Economics Minister Doris Leuthard has highlighted Mexico's vital role for Swiss businesses in the Americas on the first day of an official visit.

During talks with Mexican partners, she agreed to seek closer cooperation between Switzerland and Mexico on environmental and energy matters. but also demanded better protection of Swiss companies' interests.

Speaking after meeting Economics Minister Eduardo Sojo on Tuesday in Mexico City, Leuthard highlighted the potential of the local market for Swiss companies and efforts to increase imports from the North American nation.

She said that the Swiss insurance sector and environmental service companies stood to benefit, as well as the Swiss machinery, pharmaceutical and biotechnology firms.

Both sides also agreed to organise seminars for small and medium-sized enterprises to promote the opportunities on the Mexican market.

Leuthard, who is accompanied by a major business delegation, pointed out the pivotal role of Mexico within the Organisation for Economic Development and Cooperation (OECD) and the World Trade Organization, in particular for other Latin American countries.

Mexico has a strong strategic position between North and South America. It also serves as a trade hub for the Asia-Pacific region as well as Europe.

Leuthard told swissinfo that the Mexican authorities pledged to take action in a bid to crack down on counterfeiting, breaches of intellectual property rights and crime in general.

"The talks were very constructive. We were assured that our input is taken seriously, but we can't expect results immediately," she said.

The Swiss delegation also raised the apparent lack of competitiveness and shortcomings in police and legal proceedings, which put the Mexican market at a disadvantage.

Leuthard said she had heard of a major case of theft at a Mexican subsidiary of the Hilti technology group where local police even failed to record the crime.

Infrastructure

For his part, Sojo stressed that the Mexican economy is prepared to weather a downturn in the United States economy.

"Over the past five years our economy has developed in a bid to de-couple from the US economy," he pointed out.

He said the fiscal reforms provided funds for necessary infrastructure projects in transport and energy sectors. Sojo added that Mexico is keen to further diversify exports and forge closer business relations with countries other than the US and Canada, its partners in the 1994 North American Free Trade Agreement (Nafta).

Economists say the medium-term outlook for the country is positive as a result of strong institutions and fiscal prudence.

They point out potential for the banking sector. However, they are critical of restrictive regulations for financial services and the large foreign ownership of banking assets.

Environment

Leuthard also met the environment minister, Rafael Elvira, on Tuesday. Both sides came out in favour of pushing ahead with talks to boost cooperation on environmental and energy issues.

Moves are underway to sign a memorandum of understanding according to an economics ministry spokeswoman.

Leuthard, who is on her first visit to Mexico, is to meet the finance minister, Augustin Carstens, and the central bank governor, Guillermo Ortiz later this week, before travelling to the city of Monterrey – a major industrial hub in the northeast of the country.

swissinfo, Urs Geiser in Mexico City

In brief

A free trade accord between the European Free Trade Association (Efta) - which includes Switzerland - and Mexico came into force in 2001.

Mexico and Switzerland signed accords on double taxation and investment protection in 1993 and 1995 respectively.

There are more than 400 Swiss companies active in Mexico, including cement producer Holcim, the pharmaceutical company Roche, the two largest Swiss banks, UBS and Credit Suisse, as well as the engineering company ABB and food giant Nestlé.

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