Latin America must invest 3–5% of GDP annually to close its infrastructure gap, per the Inter-American Development Bank. Mexico leads nearshoring execution, now the top source of US imports, yet faces acute power and water bottlenecks — with US pipeline gas imports hitting 6.638 Bcf/d in 2025. Public-private partnerships like FIEMEX (powering 15% of Mexico’s electricity) offer scalable models, while Ecuador’s dollarization and Venezuela’s hydrocarbon potential illustrate divergent institutional readiness. Experts agree: geopolitical tailwinds mean little without domestic execution on energy, water, and governance.
According to mexicobusiness.news, the Inter-American Development Bank estimates Latin America must invest 3–5% of GDP annually to close its existing infrastructure gap and sustain long-term competitiveness — a shortfall that directly constrains nearshoring momentum across the region.
Mexico at the Center of Supply Chain Rewiring
Juan Carlos Zepeda, Partner at MIP Real Assets and CEO of Quantum Energía, stated that nearshoring is no longer theoretical:
“Since 2023, Mexico has become the main source of US imports, and together with Canada we are the main destination of US exports.” — Juan Carlos Zepeda, Partner, MIP Real Assets, and CEO of Quantum Energía
He emphasized that MIP’s investment mandate is explicitly tied to powering industrial real estate development driven by this shift. His firm has deployed capital across multiple Mexican infrastructure segments to support the operational reality of supply chain relocation.
Energy and Water: The Twin Bottlenecks
Thor Equities Group Chairman and CEO Joe Sitt identified two immediate, non-negotiable constraints for industrial site selection: power and water. “The first challenge is always power,” he said, noting that national grid expansion lags behind private-sector demand. As a result, investors increasingly turn to behind-the-meter solutions — on-site distributed generation that bypasses the national grid entirely. He added that water availability is the second consistent constraint.
Zepeda underscored natural gas as a critical enabler, highlighting that Mexico is the largest importer of US pipeline gas, with imports reaching a record 6.638 Bcf/d in 2025. This reflects both deep energy dependency and the scale of infrastructure required to sustain industrial growth.
PPP Models and Institutional Readiness
The panel spotlighted public-private partnerships (PPPs) as a scalable financing mechanism. Zepeda cited FIEMEX — a sovereign infrastructure fund co-managed by MIP (65% equity), a Mexican sovereign fund, and pension capital — as a working model. FIEMEX currently powers approximately 15% of Mexico’s electricity, making it one of the largest infrastructure PPPs in the country’s history. It raises capital via international bond issuance while maintaining a public-interest mandate.
Ecuador’s Vice President María José Pinto highlighted dollarization — adopted in 2000 — as a foundational source of macroeconomic trust that continues to bolster investor confidence decades later. In contrast, Venezuela’s presence at the summit signaled openness to oil and gas investment, but Zepeda stressed that institutional and legal preconditions must materialize before capital can realistically flow.
Execution Is the Only Barrier
World Travel and Tourism Council Chairman Manfredi Lefebvre d’Ovidio offered a stark assessment:
“This is the time for Mexico, and for Latin America.” — Manfredi Lefebvre d’Ovidio, Chairman, World Travel and Tourism Council
His qualifier was unequivocal:
“The only problem standing in the way is Mexico and Latin America themselves.”
Sitt echoed this, concluding that success hinges not on external geopolitics but on internal action — specifically on energy, water, governance, and institutional trust.
Source: mexicobusiness.news
Compiled from international media by the SCI.AI editorial team.
