From “Don’t Invest” to “Wait and See”: Business Confidence in Mexico Improves, but Capital Remains on Hold
Private-sector analysts’ sentiment about whether now is a good time to invest in Mexico has moved past the pessimism that dominated much of 2025, but it still hasn’t found solid footing in outright optimism. The latest Survey on the Expectations of Private-Sector Economic Specialists from Banco de México shows a meaningful shift: the share of responses describing the environment as “unfavorable” fell toward the end of 2025 and stayed at similar levels at the start of 2026. The change, however, hasn’t translated into a wave of confidence; instead, it reveals a new mood: doubt.
In practice, that doubt shows up as operational caution. Nearly half of specialists say they are “not sure” whether it’s a good time to invest, while openly favorable views remain near lows. This pattern fits an environment in which the economy avoids a sharp deterioration but lacks clear catalysts to trigger long-term decisions. It also aligns with moderate near-term expectations: a majority expects the economic situation to remain “unchanged” over the next six months—an assessment that rules out an immediate crisis, but also a rapid recovery.
The contrast becomes clearer against the official narrative. The federal government has insisted there is a large pipeline of private investment for the current six-year administration, framed under Plan México. In reality, the gap between announcements and execution remains the key issue: permits, energy availability, water, logistics, security, and regulatory certainty all weigh heavily when companies try to turn intentions into construction, capacity expansion, or new plants. In particular, capital-intensive investments—advanced manufacturing, e-mobility, semiconductors, data centers, and supplier networks—tend to require longer horizons of certainty than respondents say they currently perceive.
The 2026 calendar adds another reason to wait: the USMCA review, scheduled for the second half of the year, is acting as a “pivot date” for many companies. Mexico has benefited from its production integration with the United States and the reshoring/nearshoring of supply chains, but part of the private sector prefers to postpone decisions until it gets clearer signals on rules of origin, dispute-settlement mechanisms, industrial policy, and the overall tone of the North American trade relationship. It’s no coincidence that, even with major investment announcements in northern Mexico, many projects remain in planning, land acquisition, or engineering phases, without yet translating into a sustained pickup in fixed investment.
The macroeconomic backdrop also sets limits. Growth forecasts for 2026 remain subdued, with several scenarios clustering around 1%, depending on external conditions and domestic capacity to remove bottlenecks. On top of that, interest rates are still relatively high in real terms—despite an easing cycle already underway—which raises financing costs and increases the return threshold companies require. For sectors such as construction, transportation, or import-intensive manufacturing, dynamics in the foreign-exchange market and external volatility also influence execution pace, even though the peso has shown resilience in recent episodes.
Where the signal is most delicate is in the composition of investment. Mexico can attract foreign direct investment inflows, but the economy needs total investment—domestic private, foreign, and public—to be large enough and steady enough to sustain potential growth. In recent years, public investment has faced budget constraints and reallocations, while domestic private investment tends to react more quickly to regulatory uncertainty and a weakening business environment. The result is a gap: the country benefits from its “geographic moment” and preferential access to the North American market, but it doesn’t always convert that advantage into a cycle of productivity and infrastructure that steadily raises income per capita.
Business leaders have been explicit about the factors that weigh most heavily. Confidence in the rule of law, regulatory clarity, the physical security of operations, and certainty around labor and tax rules routinely appear as priorities. At the same time, regional inequality shapes the reach of nearshoring: northeastern states and the Bajío capture a significant share thanks to their industrial base and human capital, while other regions face high informality, insufficient infrastructure, and higher security costs. That asymmetry limits the “depth” of the phenomenon: even with announcements of new plants, the benefit is not distributed evenly and does not, by itself, create a nationwide step-change in investment.
Looking ahead, the challenge is less about interest and more about execution. If 2026 delivers credible signals of certainty—through the USMCA review, regulatory stability, and the ability to secure energy and logistics—the announced pipeline could translate into capital spending and formal employment. If not, the most likely scenario is moderate growth, with selective investments concentrated in already-established regions and sectors, while the rest of the country moves at a pace too slow to close productivity gaps.
In sum, private-sector sentiment has shifted from a flat “no” to a strategic pause: Mexico’s economy retains structural advantages thanks to its integration with North America, but the decisive step depends on institutional certainty, enabling conditions, and implementation. The market isn’t pricing in a collapse—but it also hasn’t found compelling reasons to accelerate capital.
