TERTIARY SECTOR IN MEXICO: CHARACTERISTICS AND EXAMPLES - ECONOMY - 2025

The tertiary sector in Mexico was estimated to represent 59.8% of the country's Gross Domestic Product in 2013. This service sector employed 61.9% of the total active population.

Throughout the 20th century, Mexico transformed from being an agrarian economy to an industrial one. Thus, in the 1960s, manufacturing was center stage and had become the engine of growth.

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However, the service sector slowly began to assume a larger role and has now become the dominant force for the Mexican economy.

In other words, the service economy has grown considerably as a percentage of the total. At the end of 2016, the Mexican economy was represented by 63.4% services, 33.4% industrial and 3.2% agriculture. This can be compared with 56.5%, 39.5% and 4.0%, respectively in 1993 «.

Within the tertiary economy, trade and financial activities have seen the greatest improvement. In other words, the growth rate in these two sectors during the period has exceeded the growth rate of the economy as a whole.

characteristics

This sector includes transportation, commerce, storage, tourism. At the same time, the tourist activity includes restaurants and hotels, art and entertainment.

The tertiary sector includes various professional, financial and governmental services, such as health, education, financial and banking services, telecommunications, as well as public administration and defense.

Similarly, this broad sector includes real estate activities and rental activities.

Figures from the Tecnológico de Monterrey Business School report an improvement in the economic division of this sector in the first quarter of 2018. During this entire period, it contributed 1.8% of the 2.2% registered in the increase in GDP from Mexico.

On the other hand, the service sector is expected to be a front-line engine of economic growth. This hope is based on the fact that the scope of services occupies more than 50% of the Mexican workforce.

Mexico's service sector is strong, and in 2001 it replaced Brazil as the largest service sector in Latin America, in dollar terms.

tourism

Tourism in Mexico is a great industry. Since the 1960s it has been heavily promoted by the Mexican government, as "an industry without chimneys."

Mexico has traditionally been among the most visited countries in the world, according to the World Tourism Organization.

Mexico was the first in number of foreign tourists among Latin American countries, the second in the Americas after the United States.

In 2017, Mexico was ranked as the sixth most visited country in the world for tourism activities, with more than 22 million visitors.

It has a significant number of sites (31) on the UNESCO world cultural or natural heritage list, among which are ancient ruins, colonial cities and nature reserves, as well as a number of public and private modern architecture works.

Tourism in Mexico is supported by more than three million jobs in the country, which represents 7.3% of the total workforce. In addition, it contributed 13% of GDP in 2011.

Bank System

Financial service is one of the main components of Mexico's service sector and it is the one that has attracted the majority of foreign investment.

According to the IMF, Mexico's banking system is financially sound, where banks have well-capitalized profits and are profitable.

There have been a growing number of foreign banks and financial institutions entering the country, either independently or as part of a merger with a local company.

The presence of companies such as Citigroup, BBVA and HSBC has also been considered one of the main reasons why Mexico was able to recover from its currency crisis in 1994.

According to International Banker, of the 45 banks currently operating in the private sector, the two largest institutions, Banamex and Bancomer, own 38% of the industry's total assets, while the top five have a significant 72%.

Stock Exchange

The Mexican Stock Exchange is also highly capitalized and developed. It is the second largest stock exchange in Latin America, behind Brazil, with an estimated market value of more than US $ 700 billion.

The Mexican Stock Exchange is also closely linked to the US market and, therefore, has been highly influenced by any movement and evolution in the New York and NASDAQ stock exchanges.

Examples of companies

Financial services

Citigroup's acquisition of Banamex, one of the oldest surviving financial institutions in Mexico, was the largest corporate merger between the United States and Mexico, at $ 12.5 billion.

Despite this, the largest financial institution in Mexico is Bancomer, associated with the Spanish BBVA.

SERFIN is part of Santander, Canadian Scotiabank owns Inverlat and Bital operates as part of HSBC.

Televisa

It is the leading Mexican company in the different media, being the largest company in its category in all of Latin America.

It is a major international entertainment business. Much of its programming is broadcast in the United States by Univision, with which it has an exclusive contract.

Group

It is a Mexican hotel company whose headquarters are in Mexico City. It manages, operates and leases hotels, resorts and villas that it owns, with its six different brands.

As of December 31, 2013, Grupo Posadas operates and controls 110 hotels and resorts with a total of 18,943 rooms in 45 cities in Mexico and the United States. The only destination outside of Mexico is in the state of Texas, in the United States.

Port of Liverpool

It is commonly known as Liverpool. It is a mid-to-high-end retailer that runs the largest department store chain in Mexico. It has operations in 23 shopping centers, including Perisur and Galerías Monterrey.

Its 85 department stores comprise 73 stores under the Liverpool name and 22 stores under the French Factories name. It also operates 6 Duty Free stores and 27 specialty boutiques. Its headquarters are in Santa Fe and Cuajimalpa.

Themes of interest

Main economic activities of Mexico.

Economic sectors of Mexico.

Economic problems in Mexico.

References

1. Wikipedia, the free encyclopedia (2019). Economy of Mexico. Taken from: en.wikipedia.org.
2. Fx Street (2019). Mexico: Service sector driving economic growth. Taken from: fxstreet.com.
3. Prableen Bajpai (2015). Emerging Markets: Analyzing Mexico's GDP. Investopedia. Taken from: investopedia.com.
4. Wikipedia, the free encyclopedia (2019). List of companies of Mexico. Taken from: en.wikipedia.org.
5. Wikipedia, the free encyclopedia (2019). Televisa. Taken from: en.wikipedia.org.
6. Wikipedia, the free encyclopedia (2019). Liverpool (store). Taken from: en.wikipedia.org.
7. Wikipedia, the free encyclopedia (2019). Posadas Group. Taken from: en.wikipedia.org.
8. Economy Watch (2010). Mexico Industry Sectors. Taken from: economywatch.com.
9. Lifepersona (2019). Economic Sectors of Mexico: Main Characteristics. Taken from: lifepersona.com.