Elections, volatile currency top risks for LatAm nearshoring, NTT Data says

NTT Data

16/02/2024 17:58

By Aida Pelaez-Fernandez
       MEXICO CITY, Feb 16 (Reuters) - A top executive for
Japanese tech firm NTT Data  9613.T  said  recent "nearshoring"
trends are encouraging companies to move to Latin America,
particularly Mexico, but noted concerns by NTT and its clients
over currency risks and upcoming elections.
    The consulting firm, which pioneered mobile emojis in the
1990s and operates across 50 countries, provide information
technology (IT) and business advice to the wave of firms
expanding to the region from Asia or Europe, among others.
    NTT's Latin America and Europe CEO Chieri Kimura told
Reuters in an interview on Thursday that while North American
nearshoring - moving production to countries closer to the
intended market - was encouraging firms to move to Latin
America, there remained concerns over volatile currencies and
policy-making.
    He pointed to presidential elections this year in the United
States, Mexico and other countries across the region.
    "This year, the biggest risk we need to monitor is the U.S.
election," Kimura said, adding that it would have a "big impact
on the entire geopolitical situation" without elaborating
further. The election is widely expected to be a rematch between
President Joe Biden and his predecessor Donald Trump.
    Mexico has emerged as one of the main beneficiaries of a
"dramatic" shift in the global supply chain, he said, which was
embraced by a Trump administration that sought to move
production away from China.
    In both Mexico and the United States, voters will this year
choose between the current party in power or a shift to the
right.
    For NTT Data, Kimura said Mexico "is a very attractive
market" and "one of the most important countries in which to
grow our business." 

 (Reporting by Aida Pelaez-Fernandez; Editing by Bill Berkrot)
 ((Aida.Pelaez-Fernandez@thomsonreuters.com;))