RISK ANALYSISMEXICO

ABHIMANU SINGH | JAYASURYAA H. | RHYTHM MALHOTRA |

ROHAN BHARAJ | SRIRAM S. AYYAR | UCHIT ARORA

POLITICAL RISK ANALYSIS

• Ranks 103 out of 175 countries in Corruption Perception Index (CPI)

• Rule of Law and Freedom for Protest are two parameters that are performing badly.

• Present Government is showing policy stability and political will for growth oriented measures.

• Economic Indicators validates the presence of a good political system.

Basis of CPI: Perceptions of corruption of those

in a position to offer assessments of public sector corruption.

Mexico is not showing considerable growth, while its not declining in status either.

FREEDOM IN THE WORLD

EASE OF DOING BUSINESS

Particulars Rate CommentsInterest Rate 3% As on November 2015Interbank Rate 3.32% As on November 2015Deposit Rates 0.84% As on December 2014Government debt to GDP 30.7% As on December 2014Government Bond 10 Year 6.34% As on December 2015GDP- Nominal $1.283 trillion As on December 2014GDP Per Capita $8626 As on December 2014Corporate Tax Rate 30% As on December 2015Personal Income Tax Rate 30% As on December 2014Sales Tax Rate 16% As on December 2015Social Security Rate 9.23% As on December 2014Foreign Exchange Reserves 170 million As on October 2015Gold Reserves 122 tons As on July 2015Unemployment Rate 4.55% As on October 2015Wages 292 MXN/Day As on October 2015Minimum Wages 70.1 MXN/Day As on October 2015Retirement Age 65 years As on December 2015Home Ownership Rate 76.4% As on December 2010Population 123.79 million As on December 2014

source : tradingeconomics.com

ECONOMIC FREEDOM 2015

RISK BRIEFING

SOCIO-CULTURAL ANALYSIS

Hierarchical Society

Collectivistic Society

Masculine society

Avoids Uncertainty

Normative

High Indulgence

HOFSTEDE MODEL AIR QUALITY

HUMAN DEVELOPMENT INDEX

SOURCES•A.M.BEST•Transparency International Corruption Perception Index https://www.transparency.org/cpi2014/results•http://www.transparency.org/cpi2014/in_detail•Index of Economic Freedom- http://www.heritage.org/index/•Freedom In The World 2015- https://freedomhouse.org/report/freedom-world/freedom-world-2015#.VjDNGX4rJdg•World Bank Doing Business Reports- www.doingbusiness.org•Tradingeconomics.com/mexico• http://www.heritage.org/index/•HumanDevelopmentIndex•http://geert-hofstede.com/•EIU Country Risk Ratings- http://viewswire.eiu.com/index.asp?layout=RKAllCountryVW3

Questions1. Keeping the current situation in mind, do you think Hero Moto Corp should setup factory in Mexico?

2. What are the main factors hindering the high growth in Mexico?