Tianguis, Pan-American Games and Miss Mexico Pageant

August 2, 2011

Puerto Vallarta and Riviera Nayarit are getting a shot in the arm of positive news and events that they certainly need.

Tianguis 2012 will be held at the Vallarta Convention center, an event that has always been held previously in Acapulco. Tianguis is the annual (and largest) travel fair and market for Mexican tourism. It brings in people from all over the place – nationally and internationally.

This came about because of strong cooperation between Riviera Nayarit and Puerto Vallarta to market the destination together as one. This is a great coup for the region, being the first place to hold the Tianguis since they decided to start moving it around the country. And great to see the two tourism offices coming together to make this happen. Hopefully its a sign of more compromise and working together on other projects down the line.

The Pan-American Games will also be taking place in the region, at least the water events such as sailing. This takes place this fall, primarily in Nuevo Vallarta. Good coverage should come out of this.

And the Miss Mexico pageant will be held in the region this September – that certainly should bring good coverage!

Very positive news regarding tourism for the region.


Mexico’s positive Tourism Dept. changes

July 28, 2011

In a piece featured with CNN a few days ago, a number of positive measures are mentioned with regards to what Mexico is doing to help its ailing tourism industry.

  1. Mexico has begun allowing holders of U.S. visas to enter Mexico, opening up the possibility of tourists to the United States extending their trips south of the border.
  2. Brazilians, Russians and Ukrainian visitors can gain travel permission to Mexico on the Internet, with no need for a visa. (In 2011 to date, Mexico has seen a 40.9% increase in Brazilian tourists, a 58.1% increase from Russia and 32.8% increase from China, according to Mexico’s tourism ministry.)
  3. Finally, for travelers from other countries, visas to Mexico in many cases can be obtained through a travel agent, erasing the need for trips to embassies.

These are important changes that should make it easier for people to travel to Mexico. Point #1 is an excellent move, as it allows for people that are planning to visit the U.S. to now, with no additional paperwork, visit Mexico at the same time. And point #3, that visas can now be obtained through a travel agent and not have to visit an embassy, is also a great idea. But will it be enough?

Mexico has to look at other markets, especially over the next few years while the U.S. economy is on the road to recovery, and allow Americans time to really see the reports on violence in Mexico for what they really are: it’s taking place in very specific places, which in most cases are far from the popular tourist regions, and its being sensationalized. At some point Americans will begin to understand that millions of Americans visit Mexico every year without ever experiencing problems and actually have a very good time.

But until then, Mexico has to look elsewhere, just like U.S. investors are looking elsewhere, at emerging markets. The U.S. and Europe are going to be tied down with debt problems, both sovereign and public, along with high unemployment, for some time to come. Public debt and unemployment are going to make it hard for Americans to travel, while people in emerging markets are not experiencing similar issues. They are not plagued by high debt and unemployment. Investors are looking at foreign emerging markets for better returns, it looks like Mexico is as well for their tourist industry.

For U.S. travelers specifically, the Commerce Department’s most recent data — for 2009 — shows that 31.7% of all U.S. international tourists go to Mexico. From 2002 to 2009, while U.S. tourism to Canada fell by more than 27%, tourism to Mexico from the U.S. increased by 5.1%. This happened even though the overall number of Americans traveling abroad decreased, from a peak of 64 million in 2007 to 61.4 million in 2009.

These are impressive numbers, and coming from the U.S. department of commerce, not Mexico’s: 1 in 3 American international tourists in 2009 went to Mexico.

However, although these new markets may provide tourists, they most likely will not be providing people or families that may be interested in real estate. Mexico’s strongest target markets for real estate sales remains in the U.S. and Canada, where travel to somewhere warm is for most people, only 3-4 hours away. For the local real estate market to make a serious bounce back, it needs Americans buying second homes once again. With real estate values still falling in the U.S., it seems this is still a ways away. Although the local market seems to be holding its own, its a long ways from the boom years from 2003 to 2008.


Manufacturing Business in Mexico is strong…

July 12, 2011

This article was featured in the NY Times yesterday. Here’s some of the highlights:

When the latest bloody headlines from the drug war in Mexico reach headquarters in New York, Ken Chandler, the manager of an American electronics manufacturing plant here, jumps on the phone. He is not begging to come home. He is begging to stay. “We try to put them at ease, to say it is not time to pack up,” said Mr. Chandler, who oversees the company’s operations in this border city, where the military arrived last week to help purge drug cartel members from the police department.

Not that his employer, Spellman High Voltage, needs much assurance. Like a crop of other manufacturers at the border, including six companies in this city alone, Spellman is expanding its operations, with a new plant under construction after making a calculation that offers one of the starker paradoxes of these violent days in Mexico. Despite the bleak outlook the drug war summons, the Mexican economy is humming along, not without warning signs, but growing considerably faster than that of the United States.

Over all, jobs in Mexico’s manufacturing sector increased 8.2 percent to 1.8 million as of January, the most recent figures available, driven mostly by what Mexican officials called regaining health in the auto and electronics industries, the engine of the economy along the border.

Mostly American-owned and in border states, the plants import raw materials duty free and export assembled products, lowering the cost of goods in the United States and providing jobs that pay more than the Mexican average (typically $8 to $16 per day on the assembly line) but a lot less than American wages.

Some of the new or expanding plants come at the expense of plant closings in the United States. Electrolux, which makes washers, dryers and other home products, closed a plant in 2009 in Iowa but opened one in Juárez last month that is expected to employ 400 people. Others are from investors farther afield. Foxconn, a Taiwanese firm that makes iPhones, Dell computers and other electronics, is one of several Asian companies taking root. It opened a plant in Juárez last summer. Down the coast from here, Posco, a Korean steel manufacturer, has announced plans to expand its operations with a second plant that will employ 300 people by 2013. Several other companies plan to built or expand in other states as well.

Over all, the Mexican economy, the second largest in Latin America after Brazil, grew 5.5 percent last year, its fastest pace in a decade, and is expected to grow 4.5 percent this year, driven largely by manufacturing as well as internal growth from an expanding middle class. The American economy, by contrast, is expected to grow between 2.7 percent and 2.9 percent in 2011, the Federal Reserve projected late last month.

Economists say Mexico’s growth would be even stronger without the cartel violence, which in the last five years has left more than 40,000 people dead, according to the count by national newspapers.

Why do they have to put it that way? Over 90% of those killed were narcos killing each other or being killed by police and/or the army. The other 10% consists primarily of the army or police killed fighting against them. There has been little “collateral damage”, as Rumsfeld used to like to say…

The Bank of Mexico reports foreign investment was $17.7 billion last year, far off pre-recession levels of $25 billion and fed in good measure by a single transaction, the purchase of a one of the country’s largest beer companies by Heineken.

Security costs are rising to protect property and shipments, and safety remains the top concern expressed by potential investors, said Bob Cook, the president of the El Paso Regional Economic Development Commission, which helps recruit businesses to Ciudad Juárez, Mexico’s most violent city. “But we are still working with more companies now than we did three years ago,” he said. Business is business, and the proximity to the United States is hard to pass up. The rising cost of labor, transportation and the renminbi have made some companies reconsider Mexico instead of China, he contended. Despite several murders a day, trade between Juárez and Texas rose 47 percent last year to $71.1 billion, he said.

“Central location, great infrastructure, suppliers and labor pool,” he said. “Those things haven’t been tampered with by organized crime.”

See the full story here.


Americans still flocking to Mexico…

July 3, 2011

according to an ABC news report, quoted by Michael Zenn of BoomerAbroad. Unfortunately no links were included for the report, or for the one by the LA Times, but it all sounds good!

Recent reports strongly indicate that the highly televised Mexican drug war has not stopped most Americans from traveling or moving South of the Border.  In fact, according to an ABC News report, of the 5.25 million Americans living in other countries, the vast majority (over 1 million) live in Mexico, and many more may be on their way.  A number of Mexican communities now virtually look like U.S. suburbs and in some cases American and Canadian property owners outnumber locals.
No Fear Here
In areas far from US border towns, such as Playa del Carmen and Tulum, Mexico’s drug war is a distant and far away place.  In fact, when surveyed, most Americans living here feel that they are much safer than in cities like L.A., New York, Chicago, Atlanta or Miami.  Indeed, recent statistics prove them to be right.
According to a report last year by the LA Times, tourist areas in Mexico are 12 times safer than Tampa or Honolulu, 17 times safer than Dallas or West Palm Beach, 26 times safer than Orlando or Houston and a whopping 39 times safer than the U.S. capital, Washington D.C., and Americans and Canadians are coming in droves.
Why Here, Why Now?
Americans and Canadians are sneaking South of the Boarder for all the usual suspects: tropical weather, pristine property, tree-lined beaches, white-sand, warm turquoise water, crystalline coastlines, the beckoning beach lifestyle, and a litany of other adjectives.  But perhaps this time they are descending on magical Mexico for a compelling new impetus altogether.
When the global recession hit, many retirees and investors were driven south where life is cheap and the living is easy.  A dollar down here buys roughly 30% more, taxes are negotiable, and the economy is rebounding at a rapid pace.  Personal debt and the credit crisis are virtually non-existent since Mexicans do not generally use credit to buy things.
Surging Economy
That could explain why the Mexican economy is surging (not sputtering) out of the global recession, recording a 4.3% growth rate in the first quarter of 2010 alone (much faster than the U.S.)  And if you had invested $10,000 here in 2000 you would have witnessed a 232% gain in your bank account.
Perhaps the biggest bonus for retirees and investors in Mexico has been their opportunistic purchases of homes, condos and real estate property.  In key areas, real estate development in Mexico is far outpacing growth in other countries. For example, Playa del Carmen was named the fastest growing area in the world just a few years ago and Tulum, just to the south, is poised to grow even faster in the next 5 years.
Healthcare Heaven
The other goldmine that Americans and Canadians are getting in Mexico is the veritable healthcare jackpot they enjoy that includes full medical, dental and vision coverage for about $600 a year. This government run healthcare plan (IMSS) was created for Mexican employees but is also open to legal foreigners. Imagine a healthcare-fantasy world where there are no deductibles, no co-pays, no limits, no prescriptions to pay for and even pre-existing conditions are covered after 1-2 years.  No small reason to make your way to Mexico.
There are now over 18,000 major American companies currently investing and operating in Mexico and it is estimated that over 1 million Americans are buying, building and or retiring here.  In truth, no one knows exactly how many American or Canadian retirees, entrepreneurs, and families are now traveling or making plans to relocate to Mexico. One thing’s for sure, it’s not a few, it’s not slowing down, and there seems to be no end in sight.  And for those who might doubt it, just ask the Mexican locals and they will quickly remind you “they’re moving in all around us!”.
by Michael Zenn, Boomers Abroad

Good weekend to be in the Vallarta area

March 15, 2011

Three great events took place this past week that made the Vallarta region a wonderful place for water sports enthusiasts. First there was the Banderas Bay Regatta, now in its 19th year. This five day event held from the  8-12, is a regatta designed with Cruisers in mind – fun but competitive races between boats designed for coastal and offshore cruising. It was great being offshore watching them race from Nuevo Vallarta to Punta de Mita, but I’m sure if was even better on board. Race boats and catamarans joined the fun as well in this non-profit event that included nightly fiestas, live music and entertainment; at this signature event for the Vallarta Yacht Club.

Next was the Punta Sayulita Surfboard and SUP (Stand-up Paddleboarding) Classic held in Sayulita. Top name surfers and SUPers from around the world were there to surf and race. It was three days of festivities in Sayulita, which is always a fun place to hang out at anytime. On Saturday night recording artist Mishka performed on the beach to a very large crowd.

This was followed by a SUP clinic held at the Hotel des Artistes del Mar in Punta de Mita, led by the surf legend himself, Mr. Pipeline: Gerry Lopez. The three-day clinic is currently going on, with a slideshow presentation given this evening that was open to the public, given by Gerry showing photos and sharing stories of his amazing life is surf starting back in Hawaii in the 60s.

While some people were freezing to the north, or worried about the very slim chance that they could be a victim of violence in Mexico, others were having a very, very good time in PV!

March 4, 2011

I recently posted an article written up in The Economist that did give a very positive portrayal of how tourism promotion is handled by the Mexican government. Here’s some highlights of another article, but much more positive, that was featured in The News and features an interview with Mexico’s Secretary or Tourism, Gloria Gevara.

“The Year of Tourism in Mexico is one of the greatest strategies of President Calderón. We began the implementation of this program in 2010, because Mexico has great options to offer for tourism. The sector accounts for 9 percent of the country’s GDP and creates nearly 7.5 million jobs, both directly and indirectly, and it is also the third most important industry in the country,” she noted.
“However, if we compare ourselves to another tourism economy like Spain, a country that is smaller than Mexico, and if we consider its tourism options, geographical position and other important aspects, we can corroborate that for them, tourism represents 12 percent of their GDP and it is their first source of income. This means that Mexico has even better opportunities to improve the tourism industry and create millions of jobs, which will ultimately boost our country’s economy,” she added.
She said that the aim of the Year of Tourism in Mexico is to create a comprehensive project that will strengthen the industry. The program is part of a strategic plan that will include special activities and events in 2011, which will further develop the sector. “The President, tourism representatives, governors, legislators, investors and the Secretary General of the World Tourism Organization have already signed an agreement. The objective of said agreement is to implement several programs and make a commitment with the private sector, functionaries and legislators to make sure that everyone participates in making our country a better place,” she said.

Are there any specific goals to evaluate tourism promotion in the Year of Tourism in Mexico?
Most certainly. We’ve set a series of goals that we want to achieve regarding revenue, arrivals and the amount of national and foreign visitors. Nevertheless, we also have long-term goals, which will be achieved over a period of eight years. During this period of time, we think that Mexico will be able to make it to the list of the five most visited countries in World. Currently, were are No. 10 in most visited countries and No. 19 regarding economic spillover. Our goal eight years from now is to be No. 5 on both lists. But in order to do that, we need a continuous growth of 15 percent in the tourism sector annually. In 2010 we had 22.6 million visitors, but by 2018 we want 50 million. True, it’s more than double so we need continuous growth to that, but we’ll deliver.

There is this perception that Mexico is a violent country, and public opinion seems to fuel this perception. How has this affected the tourism industry?
Well, we do have an important challenge, and we cannot ignore it any longer. We are aware that Mexico is going through a harsh situation, but insecurity is an evil that has affected every single country. You can see these situations everywhere, and both tourists and the local population are affected. There are countries like Egypt that depend a lot on tourism, and we already know how things are going there. Another example is Russia that has suffered a lot due to the events of the past few weeks.
“In 2008, 5.8 million US citizens visited us by air, in 2009 we had 5.3 million, and in 2010 we had 5.9 million. What does this mean? Well, it means that we had an increase of 10 percent compared to last year and almost two percent compared to 2008. We did all this in spite of the alerts. We also see lot of Canadian tourists. In 2001, 1.1 million Canadian citizens visited us by air, while in 2009 we had 1.2 million and in 2010 almost 1.5 million, which means an increase of 20 percent compared to last year and 29 percent compared to 2008. The US and Canada account for 74 percent of the total of tourists that visit Mexico, but we did see that other countries visit us as well.

What is the reality Mexico is facing with other countries regarding security?
Well, we have to put things into context. When people overseas talk about Mexico, they usually refer to Cancun, but generally speaking, people talk about the entire country. The same thing happens with Colombia, people talk about the entire nation, it’s rare to refer to Bogotá, Medellín or Cartagena. We can also say the same about Brazil, we talk about a whole. However, when we talk about the US, we do mention specific places, including Washington, Arizona, Las Vegas and others. We must mention, though that, in spite of the period of turmoil of sorts the country is currently experiencing, many of our tourism hot spots are safer than most tourist areas in the world. People don’t really talk about that, but it’s true. Yucatán is a perfect example. The state is really safe, far better than security rates in some European countries. Campeche is another case, Chiapas as well. I insist, this is a difficult challenge that we must face, but if we compare our country with several island nations in the Caribbean or other Latin-American countries, our security standards are way above them. We’ve seen, unfortunately, that countries that did not know much about us in the past, now think of us as a nation of violence and insecurity, so we must make sure that we tell people that Mexico is much better. We must tell them that our reality is different from what they think it is.
How is Mexico supposed to react to the alerts issued by several countries?
We must tell the people how well Mexico really is doing. We are a big country, and we take that for granted, but few people know that we are the 14th economy of the world that has a huge area, so it’s important to put things into perspective. President Calderón has urged us to stay united and say good things about Mexico. We cannot ignore the situation we’re currently living in, but it is important to tell the people about the positive things. In 2010, 22 million people visited us, and nothing amiss happened to them. They all had the time of their lives, so much so, that many of them choose to stay here, forever. The bad thing is that no one informs the public about that. Many Mexicans think that the reality is extremely harsh, but it’s not. People in several states can walk around in the middle of the night and visit tourism hot spots without any worries.

You can read the full article here.




Telling it like it is…

March 1, 2011

This article was recently written up in the Economist magazine. Anyone who has ever had anything to do with Mexico’s primary travel show, “Tianguis” in Acapulco, will know there a lot of truth to what Roberto is saying here…

Talk about inconsistency. When Felipe Calderón kicked off his administration four years ago, he sought to eliminate the Tourism Secretariat. Late last year, he declared 2011 to be the Year of Tourism, and on Monday he pompously launched something called the National Tourism Agenda.
Over the years, Mexico became a veritable travel trade powerhouse, attracting up to 22 million foreign visitors, in addition to 45 million domestic travelers, and earning a tidy US$20 billion a year, behind only oil revenues and ahead of income from remittances sent home by migrant workers, and manufacturing exports.
Ever since the glory years of the 1960s and 1970s, when thousands of Winnebagos safely crisscrossed the nation’s highways, each succeeding government has believed that all you have to do to promote Mexico as a major destination is spend millions of dollars in allegedly targeted TV, newspaper and magazine ads in the United States, the source of more than 80 per cent of our visitors.
The basic problem is that Mexico has never worried about the regulatory aspect of the travel trade. Abuses by taxi syndicates are legendary, and the specific case of Los Cabos is outrageous. Rather than promoting a genuine service vocation, federal authorities have negligently allowed local governments to do as they please, and the result is that local service providers have a nearsighted culture of squeezing as much out of a tourist today, and the hell with tomorrow… Read the rest of this entry »