For a long time, Celanese and Mexico have enjoyed a successful and rewarding relationship with almost 70 years of continued presence as one of Mexico’s most notable companies. It all started in 1945 when Celanese began manufacturing cellulose acetate yarn for the textile industry at Ocotlan, Jalisco. The 1950s and 1960s marked an important growth in the areas of synthetic and artificial fibers (e.g., nylon, rayon) as well as the plastic film industries (e.g., cellophane). During the 1970s, Celanese Mexicana established a polyester manufacturing plant in Queretaro and started the production of acrylic esters at Cosoloeacaque. In 1982, the Cangrejera Chemical complex began operations, catapulting Celanese Mexicana into the role of the largest secondary chemicals and fibers producer in Mexico. It was also during this time that Celanese Mexicana became a major exporter with sales outside Mexico representing 37 percent of its production by volume. These goods were being shipped to the United States and Canada, Western Europe, North Africa, China and Hong Kong, and, in South America, to Argentina, Brazil and Venezuela.
In 1987, Celanese Corp. became Hoechst Celanese AG when the U.S.-based corporation was acquired by the German pharmaceuticals manufacturer Hoechst. In 1997, Hoechst spun off its Industrial Business as part of its strategy to concentrate in life sciences; as a result of this spinoff, Grupo Celanese became a fully-owned subsidiary of Celanese AG, exiting the polyester and nylon businesses and concentrating in its Chemical and Acetate divisions. This also brought a closer integration to the other Celanese operations, optimizing with this its manufacturing footprint and product portfolio, expanding the acetate operation and taking advantage of the economy of scale of the U.S .operations in other products.
Currently, Grupo Celanese has an acetate manufacturing site at Ocotlan, Jalisco, and a chemicals manufacturing site and a Maritime Terminal at Coatzacoalcos, Veracruz. Its products are used in a variety of industries such as paints and coatings, automotive, food, beverage, lubricants, filtration media, and textiles, and it continues to ship product solutions around the globe.
During the last 20 years, Mexico has committed to trade liberalization and global integration. Today, Mexico has free trade agreements signed with 44 countries which are, according to the Financial Times, twice as many as China and four times more than Brazil. Building on this is Mexico’s privileged geographical situation – neighbor to the world’s largest economy and a major export hub to the Asian, European and South American markets.
Beyond the trade efforts, the 21st century also marked an era of fiscal responsibility in Mexican public spending; this has contributed to Mexico achieving record levels of strategic reserves as well as remarkable currency stability. As a result, Mexico was able to ride the 2008 global economic crisis in relatively good shape compared to other Latin American countries, taking advantage of this major event to rationalize uncompetitive manufacturing technologies while modernizing the remaining manufacturing footprint.
This long-time continued commitment to trade liberalization and focus on fiscal responsibility has produced, as indicated in the chart below, a growth in Mexico’s export USD levels of approximately 640% from 1993 to 2011 (i.e., from NAFTA until today).
Today, a combination of available skilled labor, modern technologies and unprecedented government reforms in key areas of public policy (e.g., labor, education, and telecom) are making Mexico a very attractive investment destination in sectors such as automotive, electronics, household goods, and aerospace. As the Financial Times quoted in its September 19, 2012 article: “Today, Mexico exports more manufactured products than the rest of Latin America put together.”
However, despite this promising foundation, there is no question Mexico has serious issues to address in order to be able to grow beyond its current opportunities: endemic corruption, security, and outdated energy policies – to name only a few. However, as Celanese’s 68-year track record proves, a long, successful history is not the product of serendipity, but on the contrary, the result of an innovation-quality-customer focused driven workforce together operating in a country offering a business-friendly environment.
Figure 1. Mexico’s Merchandise Trade with All Countries
Source: Compiled by Congressional Research Service using data from Mexico’s Ministry of Economy and Global Trade Atlas.
Into the future, the potential in Mexico is there. With a current customer base in Mexico across a range of industries – food products and ingredients, adhesives, coatings and paints, automotive solutions, and tobacco products – Celanese has a solid foundation for creating customer value and providing new chemistry solutions. More importantly, Celanese can bring a broad knowledge base to support collaborations with our customers required to satisfy the technical demands that the industries coming to Mexico need. The degree with which we are successful rising to this challenge will determine our success in Mexico for the next generation to come, as it has determined our success to date.