Two major announcements of electronics-related expansions and investments are recent examples of Mexico’s growing attractiveness in the global electronics market.

    Tata Consultancy Services, a leading IT services firm based in India, recently opened a software development center in Guadalajara with 300 employees. The firm then announced it intends to hire as many as 5,000 local workers in the next five years. Meanwhile, Hewlett Packard recently expanded its Global Business Center in Guadalajara and says it will add 250 workers.

    For Mexico President Felipe Calderón, the announcements are proof of Mexico’s attractiveness to the electronics sector. Mexico’s electronics industry includes more than 700 manufacturing companies. It employs more than 320,000 people and its exports comprise nearly 27 percent of all manufacturing exports.

    A year ago, Mexico’s country risk was 156 base points, a figure that has now fallen to 75 base points, the lowest in Latin America, together with Chile.                              Information technologies, explained the president, serve as an enormous incentive for the country, as well as acting as a magnet for investment and well-paid jobs.

    Information technology in Mexico has grown at an average annual rate of 15 percent. Calderón predicts that rate could increase to 35 percent annually, provided three challenges are dealt with. These include improving human resource training, adopting new information technologies and ensuring legal, juridical and public security in the country. Meeting those challenges will, in turn, attract more investment in the long run.

    To achieve this the government is promoting technological development on several fronts by first providing tax incentives to encourage technological R&D, second, assigning over 2.7 billion pesos to the Fund to Support Micro, Small and Medium Firms for technological financing, training, commercialization, management and innovation and third, reinforcing the Science and Technology Fund for Economic Development which, in conjunction with CONACYT, will assign a further 500 million pesos for other technological innovation and development projects.

Tata Consultancy Services

  Tata Consultancy Services is opening its first Global Delivery Center (GDC) in Guadalajara.

    This is the first major investment by an Indian information technology (IT) firm in Mexico and the new center represents an important step in TCS’ global strategy to further enhance its Global Network Delivery Model, allowing it to better serve its clients in Mexico and across the world.

    “The inauguration of this Software Development Center, together with the expansion of Hewlett Packard’s premises, are specific actions showing that Mexico is an attractive destination for investment, particularly as regards information technology,” said Calderón.

    Calderón said that last year, preliminary foreign investment figures for Mexico between January and March 2005 totaled approximately $3 billion. This year’s preliminary figures for the same period total more than $6.5 billion, twice the amount recorded last year and the highest sum of direct foreign investment in Mexico in a single quarter.

    As a result of its efforts, Jalisco has a state-of-the-art technological corridor, a genuine Mexican Silicon Valley that has successfully adapted to global competition. In the president’s view, Guadalajara has achieved two of the priorities for economic success, which should be repeated in other parts of the country; favorable business conditions that guarantee profitable investment and well-qualified, well-trained human capital.

    Calderón predicted that by the year 2040 Mexico will be one of the world’s five largest economies, due to its vast stock of natural resources, strategic geographical location and above all, its young people and students who will enable the country to achieve its goals. Among the measures implemented to boost Mexico’s competitiveness, the government has launched a number of programs including Prosoft, designed to develop an information technology service industry with the collaboration of state governments.

    N Chandrasekaran, executive vice president & head of global sales & operations for TCS, said Mexico’s proximity to the United States was a major factor in the decision.

     “Apart from a strong domestic IT market, Mexico shares a similar time zone with and is within 5-6 hours flying distance from anywhere in the U.S., allowing us the ability to provide nearshore services for our large U.S. client community”, said Chandrasekaran.

    The Guadalajara center was inaugurated by Calderón, in a ceremony which included business, political and media leaders from the country and the state of Jalisco.

    “I thank Tata Consultancy Services for its confidence,” Calderón said. “We know the professionalism and importance that the company has not only in India but in many countries across the world and we wish to make our country one of the best investment destinations in the world, if not the best.

    “This delivery center also exemplifies the type of productive activity that must be supported and expanded, value added activities, activities that create employment, moreover to young Mexican professionals, activities oriented towards the services sector, which is an area with huge potential and demand in this century of knowledge and information, the 21st century.”

    Guadalajara, the second largest city in Mexico, (with a population of more than 4 million), was chosen by TCS after an extensive survey because of its accessibility, infrastructure and available talent pool.

    “We are impressed by the tremendous talent in this region, nurtured by a very strong education system. We will recruit the best people and train them extensively in the same high quality processes and methodologies that we so successfully use in our operations around the world,” said Ankur Prakash, general manager of TCS Mexico.

    Over the last five years TCS has set up operations in 14 countries across Latin America, including major centers in Argentina, Brazil, Chile and Uruguay, which employ more than 5,000 professionals in those countries and cater to more than 150 clients.

    “This expansion in Mexico marks an important phase in our growth. We will hire 500 people for the Mexico center in the short term and thousands more in the next five years, as we continue to build a strong high impact organization in this region,” said Gabriel Rozman, president of TCS Iberoamerica.

    Tata Consultancy Services is an IT services, business solutions and outsourcing organization that delivers real results to global businesses, ensuring a level of certainty no other firm can match. TCS offers a consulting-led, integrated portfolio of IT and IT-enabled services delivered through its unique Global Network Delivery Model, recognized as the benchmark of excellence in software development.

    A part of the Tata Group, India’s largest industrial conglomerate, TCS has more than 89,000 of the world’s best trained IT consultants in 47 countries.

    TCS Iberoamerica (TCSI) is the business arm of Tata Consultancy Services that operates across the Spanish and Portuguese speaking region of the world. More than  5,000 local consultants provide high quality IT services, business solutions and outsourcing to over 150 regional and global clients across 14 countries in Mexico, Central America, South America, Spain and Portugal. TCSI operates Global Delivery centers (GDC) in Brazil, Mexico and Uruguay at CMMi Level 5, the highest quality standard for the industry, and maintains a global BPO services center in Chile.

Hewlett-Packard project

    Calderón expressed his pleasure at being present at the inauguration of the extension to the Hewlett Packard Global Business Center, a firm that during its 25 years in Jalisco has become the country’s leading information technology firm. He went on to say that the company’s decision will not only create over 250 jobs but also extremely top quality, highly specialized jobs that will lend continuity to Hewlett Packard’s history of excellence.

    “This is an example of how the country is not only becoming an attractive investment destination for global firms, but also a bridge between other countries and a key link in the commercial chain in the global market,” he said.