Interview with Carlos Barcena Pous, Minister of Economy, Zacatecas, Mexico

Interview with Carlos Barcena Pous, Minister of Economy, Zacatecas, Mexico

 Q. How does the Ministry of Economy currently support inbound investment in Zacatecas? What initiatives are in the pipeline?

A.The State Ministry of Economy is currently supporting inbound investment in Zacatecas.througha series of key actions in this matter, such as the following:
a) Soft landing: Personalized support and follow-up on main procedures required upon establishment and initial phase of a new investment project for the state of Zacatecas.
b) Recruitment support andgranting training scholarships for newly hired workers (for a 60-day period).
c) Cash incentive to ease the company’s establishment in Zacatecas.
d) Incentive for specific and specialized training outside Mexico.
Initiatives in the pipeline: Tax, tariffs and contributions rebatesover state taxes,currently under revision.

Q. What economic and other businessbenefits does Zacatecas offer over other states in Mexico for newly investing companies?

The State of Zacatecas is offering key benefits to effectively attract Foreign Direct Investment, aimed to helpnew companies in the search for crucial elements for the company, such as: conducting query for the required supply chain for its start-up, as well as possible customers to increase a local market share… and support in recruiting and selection of human capital with specific profiles, such as: engineers and technicians. The State Government of Zacatecas also provides a possible cash incentive, which can be granted as long as the company’s Planning for Investment and Employment Program Overview meets a series of requirements; based on such planning overview, there is an analysis to determine an amount which may be of up to 10% of the total amount of investment on behalf of the company, which can be provided for productive investment. Additionally, Zacatecas can provide legal security environment for all the investment derived from establishing a new company, along with our state’s government commitment to maintain favorable conditions for the competitiveness of companies and their local growth. Partly, by focusing on completinga high-quality infrastructure in order to meet new company’s demands in terms of logistics; also, by relying on efficient links between academia, industry and government in order to ensure an adequate synergy among these main players, to create the conditions necessary for companies with new investment projects to allocatethem successfully in Zacatecas. Zacatecas has a state governmentwith a pro‐business and investment focus, and that is the reason why our aim is to have all the required elements that foreign companies are seeking for in order to choose Zacatecas as their best option for their project.

Q. Please offer a brief case study of historic successful Chinese corporate investment into Zacatecas.

A.HARBOR MINING LTD.: a Mexican-Chinese mining company of recent creation, incorporated in the State of Zacatecas.Its main activity is the exploitation, extraction, processing and marketing of Manganese, mainlyto the Asian market while looking into the possibility of selling surplus in the domestic market.
* Main foreign key customers: CYMCO from China.

Q. How easy is it to register a new company in Zacatecas, and what is the timeframe?

A. It is quite easy relatively to register a new company in Zacatecas;
Timeframe and procedures:
* It is necessary to verify the availability of the desired company name, in the Ministry of Foreign Affairs (SRE, Secreatría de RelacionesExteriores).
- With these documents, it is necessary to go with a Public Notary to register the Incorporation Documents for the new company, by the shareholders or by some representative from the company authorized to undertake this procedure by Power of Attorney.
- Next, one must proceed to register the company in the Income Tax Office (SAT, Secretaría de AdministraciónTributaria) bureau, which is the equivalent to the Income Revenue/Tax Office;
afterwards, with this Income Tax Office (RFC, for its acronym in Spanish) registration code obtained, one must register this code online on the SAT website.
These are the main steps to register and enable a new company, to function and fully operate in Zacatecas. The time frame to have all this ready is 15.5 days.

Q. How does the infrastructure of Zacatecas benefit companies using the region as a distribution hub?

A.The infrastructure of Zacatecas benefits companies using this region as a distribution hub, greatly due to its strategic geographical location and excellent road connectivity, being close to the country’s capital city as well as main cities; the distances to these main cities are:
* Mexico City (625 km.),
* Guadalajara (317 km.),
* Monterrey (450 km.), Querétaro (410 km.);

And also to the main seaports:
- On the Atlantic: Veracruz (1037 km.) and Altamira in Tampico (618 km.)
- On the Pacific Ocean (Mazatlán (607 km.), Manzanillo (650 km) and Lázaro Cárdenas), along with connectivity and proximity to the main border cities with the United States.

  • Main roads:

Road 54: To Saltilllo, Coah. (360 km.), Monterrey, NL (450 km.); and Laredo, Texas (650 km.); McAllen, Texas (660 km.). Road 45: To City of Aguascalientes, Ags. (115 km.), Guadalajara, Jal. (317 km.) and Mexico City (625 km.);

  • Zacatecas is an automotive hub, to the adjacent Bajío region (states of Aguascalientes, San Luis Potosí, Jalisco and Guanajuato) and to the north with the state of Coahuila.
  • Direct National flights. Zacatecas City to the following destinations: Mexico City and Tijuana, BC.
  • Direct International flights. Zacatecas City to the following destinations: Dallas, Texas; Los Angeles, California; and San José, California.

FERROMEXis the only main railway network covering the state of Zacatecas, with a total network of674.90 kms. within the State.
- This railway enters from the north coming from the border city of Cd. Juárez Chihuahua and the city of Torreón, Coahuila, to enter the state by the location of San Isidro/Estación Camacho (in the state limits with Durango and close to Coahuila); this railway continues south to the until reaching the municipality of Cañitas de Felipe Pescador, Zacatecas, where it continues as a railway that goes in direction to the South, passing through the municipalities of: Fresnillo, Calera (where the Airport Industrial Pak is located), Morelos Industrial Park, next by the cities of Zacatecas and Guadalupe, and continues south by the location of San Jerónimo, before reaching the state limits to the south with Aguascalientes (with the town of Cosío, Aguascalientes) andexiting in direction to the city of Aguascalientes, always by the FERROMEX main railway.
- After passing through the state of Aguascalientes entirely by the FERROMEX network, until reaching Celaya, Guanajuato, where it changes and connects to the KANSAS CITY SOUTHERN (KCS) railway network, passing through the Bajío region to the city of Querétaro until reaching Mexico City.
- Upon arriving from the city of Aguascalientes, the FERROMEX railway enters Zacatecas through the town of Loreto, Zacatecas (in the state limits with Aguascalientes to the south passing the state until reaching through the town of Salinas de Hidalgo, San Luis Potosí, heading in direction to the city of San Luis Potosí, SLP; afterwards, this FERROMEX railway changes and connects with the KANSAS CITY SOUTHERN (KCS) railway network, in direction to the city of Saltillo, Coahuila in direction to the north, passing through the city of Monterrey, NL to end in the border cities of Nuevo Laredo, Tamps. With Laredo, Texas; and Reynosa, Tamps. With McAllen, Texas.

* Also, a new Strategic Inbond facilityis currently in the process developing for next year (2018)in order to facilitate and expedite storage, (logistics) and customs procedures.

Q. What are your time-specific goalsfor job creation in Zacatecas, and which sectors are of primary focus for development?

A.The sectors catalogued as of a primary focus for development, are the ones held as key strategic sectors for the Economic Development Plan for this 2016-2021 administration period, being the following:
* Automotive, Metal-Mechanical
* Aerospace
* Renewable Energies, Eolic, SPV Parks and Waste to Energy (WTE)
* Mining
* Information Technologies (IT)
* Agribusiness
* Tourism

Goals for job creation,during 2016-2021 Period:

Planned 40,000 (as a minimum)
Desired 50,000
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