Mexico Freight Transport Report Q3 2008

At the beginning of April Communications and Transport Minister Luis Tellez said the government would invite bids for the construction of the proposed Punta Colonet mega-port, expected to cost up to US$6bn, by the middle of 2008. The port is part of President Felipe Caldern's ambitious infrastructure program. The proposed site is on the Baja California peninsula, some 129km south of Ensenada close to the US border. The port would be connected by rail to the US, and would help relieve Pacific coast congestion in that country, already acutely felt at Los Angeles and Long Beach. Tellez said he expected Punta Colonet to be built within four to five years. It would have up to 5mn TEUs per annum capacity, and take cargo shipments from Asia bound for North American markets.

BMI's newly released Mexico Freight Transport Report notes that Caldern will encourage continuing growth in trade with the US and Canada - Mexico's North America Free Trade Agreement (NAFTA) partners - and has specifically committed himself to boosting highway construction across the country.

With improving intermodal links we are forecasting average annual maritime freight growth of 4.4% per annum (not least due to the increased movement of cargo through Mexican ports to avoid congestion in US ports). Over all modes, Mexican freight growth will average 4.9% in 2008-2012, ahead of GDP expansion of 3.7% a year. BMI concludes that the value of the Mexican transport and communications will rise to US$169.3bn by 2012, representing 11.5% of the country's total GDP.

During the presidential election campaign in 2006 Caldern spoke of trying to emulate the big transport infrastructure investment surges in European economies like Ireland and Spain, which in his view underpin their current strong growth rates. BMI rates Mexico's regulatory and competitive environments highly in relation to other regional markets. In this report, in fact, we set the country's overall freight rating score at 51.4 (out of a maximum of 100).

The transport and communications sector employed 1.92mn people, or 4.6% of the labour force, in 2006.

We see that figure rising to 2.05mn by 2012, although as a proportion of the labour force it will remain constant at 4.6%.