M exico understands that infrastructure plays an important role in the increase of competitiveness and encourages more dynamic economic growth. In order to pursue those goals, Mexico laun-ched the National Infrastructure Program 2007-2012.

The Infrastructure Program is based on a number of premises, the first being that Mexico will have to substantially increase public investment in infrastruc-ture, thereby increasing the availability of public funds. Second, in any econo-my, public investment is insufficient, meaning that private investment must be promoted in infrastructure as an essential engine of development. Third, that Mexico can and must promote the conditions of economic stability that the current disciplined public finance management is providing the country. The National Infrastructure Program has set the following general objectives:

• To increase the coverage, quality and competitiveness of infrastructure. • To make Mexico one of the world's main logistic platforms, particularly in

transport and energy. • To promote balanced regional development without reducing the growing

competitiveness in the north of the country, yet focusing on the areas that lag behind in the center, south and southeast of Mexico.

• To create more permanent jobs through investment and economic growth that will be created by the infrastructure development.

• To promote sustainable development through projects that preserves the environment and encourages the rational use of Mexico's natural resour-ces.

• To promote the infrastructure required to increase tourist activities that will trigger employment and regional development.

• To improve Mexicans’ access to public services, particularly among the most disadvantaged.

(Continues on page 3)

TABLE OF CONTENTS

Mexico Launches its Infrastructure Program Foreign Direct Investment in Mexico reaches record levels Trade Balance Financial and Economic Indicators Trade fairs and exhibits in Mexico Mexico’s Official Gazette Notices EU Official Journal

September 2007 Year 7, no. 9

Mexico Launches its Infrastructure Program

2

Foreign Direct Investment in Mexico reaches record levels

Source: Banco de México Source: Banco de México

Mexico’s Total Trade in July (billion US$)

Mexico’s Trade with EU and EFTA (million US$)

2006 2007 %

Total 40.1 46.0 14.8

Exports 19.9 22.6 13.9 Exports (excluding oil) 16.5 18.7 13.2

Imports 20.2 23.4 15.8

January - May 2006 2007 %

Exports to the EU 4,390.2 5,060.6 15.3

Imports from the EU 11,537.1 13,018.4 12.8 Exports to the EFTA 56.8 80.7 42.0 Imports from the EFTA 520.7 568.1 9.1

Mexico attracted 13,244 million dollars in foreign direct investment (FDI) in the first half of 2007, an increase of 39% in relation to the same period of the previous year. This is the highest historic level for such period.

As of June 2007, a total of 36,905 firms with foreign parti-cipation were registered in Mexico, of which 8,113 were from the European Union. During the first six months of 2007, the United States ac-counted for 60.7% of total FDI, followed by Spain 13.9%, Netherlands 3.8%, France 3.0%, Belgium 1.5% and Ca-nada 0.8%.

The manufacturing sector is the main recipient of FDI, followed by financial services. The automotive, machine-ry and pharmaceutical subsectors concentrate 53% of the investment in the manufacturing sector.

This FDI figures show the confidence of international in-vestors in Mexico´s recent economic and political envi-ronment. The country has a solid and increasing domes-tic market, as well as a network of free trade agreements and bilateral investment treaties that continuously offers new investment opportunities for the private sector. For these reasons, Mexico continues positioning itself among the top preferences of investors. According to the World Investment Report 2006, publis-hed by UNCTAD, Mexico is the second most preferred location for transnational companies to establish their businesses among developing countries. Furthermore, the launch of PROMEXICO (the new trade and investment promotion agency) and the National In-frastructure Program, will contribute to further growth in FDI flows in Mexico. For more information visit:http://www.economia.gob.mx/?P=1156&NLanguage=en

Source: Banco de México and The Ministry of the Economy

Foreign Direct Investment

1994 1995 1996 1997 1998 1999 2000 2001* 2002 2003 2004 2005 2006 2007

6.4

4.9

3.8

4.7

6.16.8

9.28.6

11.1

8.6

12.6

10.9

9.5

13.2

4.5 4.65.4

8.1

6.36.9

8.88.3

10.0

6.4

9.89.0

9.7

First SemesterSecond Semester

Billions of dollars

* Excludes $12.5 bd Citicorp’s acquisition of Banamex

Source: Banco de México and The Ministry of the Economy

Foreign Direct Investment

USA60.7%

Spain13.9%

Netherlands3.8%

France3.0%

Belgium1.5%

Canada0.8% Others

15.6%

By Country

Source: Banco de México and The Ministry of the Economy

Foreign Direct InvestmentJanuary – June 2007

Manufacturing44.2%

Financial services29.0%

Commerce8.9%

Mining7.2%

Other services

5.7%

Transp. & comm.3.9%

Others1.3%

Automotive21.3%

Machinery20.8%

Pharma10.9%

Metal8.6%

Machinery elect.8.5%

Other Manuf.5.3%

Electronic Eq.

4.7%

Others19.9%

By SectorManufacturing

Mexico Launches its Infrastructure Program

3

To realize the Program, the government will undertake concrete actions. First of all, it will increase funds for the development of infrastructure. Second, it will promote the authorization of pluriannual expenditure for infrastructure investment projects based on the tax reform proposal submitted to Congress. Third, it will provide legal certain-ty for projects with public and private participation, and rapidly eliminate excess regulation of infrastructure in-vestment. Fourth, it will encourage better coordination between the government agencies and the private sector. The Program is divided into three basic areas: transport and telecommunication, energy and water. The Infrastructure Program contemplates an investment of 226.1 billion dollars during the President Calderon term, an average of 37.7 billion dollars annually. The transport and telecommunication sector will recieve 67 billion dollars and the energy sector more than 141 billion dollars during the next 6 years.

Opportunities for European firms are open in all areas of infrastructure and in the different stages of the projects such as design, financing and construction. The Program is a clear example that Mexico is working to promote development, to become more competitive and to position itself as one of the best destinations for invest-ment.

(Continues from page 1)

For more information visit: http://www.infraestructura.gob.mx

Foreign exchange rate: 11.11 peso/dollar (18-Sep-2007)

Internacional reserves: $72,280 million dollars (14-Sep-2007) Mexican stock market index (IPC): 30,887 (19-Sep-2007)

Interest rate treasury bonds CETES 28 days: 7.20%

(13-Sep-2007)

Source: Banco de México

Mexico’s Financial Indicators

Inflation rate: 0.41% (August 2007); 1.42% (January - August 2007) Industrial Gross Domestic Product: 2.4% (July 2007 / July 2006) Manufacturing: 2.80%; Construction: 1.20%, Mining: 1.80% General Index of Economic Activity: 2.55% (Jun 2007 / Jun 2006) Consumer Confidence Index: 108.0 pts. (August 2007) -2.4 percentage points (Aug 2007 / Aug 2006) Open unemployment rate: 4.0% (August 2007) Source: INEGI

Mexico’s Economic Indicators

AnnualPublic Private Total Average

Transport & Telecommunications 22.6 44.3 66.9 11.1Highways 14.2 11.4 25.6 4.3Railroads 2.4 2.0 4.4 0.7Ports 1.4 4.9 6.3 1.1Airports 2.9 2.4 5.3 0.9Telecommunications 1.7 23.6 25.3 4.2

Water 12.9 5.2 18.0 3.0Water 9.6 4.1 13.8 2.3Water-Agriculture 3.2 1.1 4.3 0.7

Energy 141.2 23.5Electricity 33.9 5.7Oil 73.4 12.2Petrochemical 33.8 5.6

Total 226.1 37.7Source: National Infraestructure Program

Resources

Investments from 2007 to 2012(Billions of Dollars)

Transport and telecommunications(Main projects)

Build and modernize 17,600 Km of higwaysConstruct 1,400 Km. of railroads and increase the average speedDevelop suburban trains (Valley of Mexico and other Metropolitan Areas)Build 12 multimodal cargo terminals, including Punta Colonet, in Baja CaliforniaConstruct 5 new seaports, including Tuxpan II for energyExpansions to 22 seaports, among them Lázaro Cárdenas and Veracruz [ these 2 projects will increase the installed capacity for container management from 4 to 7 million TEUS (twenty foot equivalent units) ]Build 13 cruise-ships docksDevelop 10 new multimodal corridorsConstruct 3 airports and expansions to 31 (Valley of Mexico and increase the cargo capacity by 50%)

Energy(Main projects)

Increase the electricity generation capacity in 9,000 megawatts and 14,000 km circuit-transmissionIncrease of 4,000 megawatts of renewable energysources to achieve a share of 25 percent of the totalgeneration capacityWiden coverage and enhance quality of the electricity supply Reduce the content of sulphur in fuelsBuild 800 km of pipelines for natural gasIncrease capacity to produce gasoline and achieve a ratio import-sale of 40 percent

Water(Main projects)

Construct water treatment plants in the metropolitan areas of Guadalajara and Valley of Mexico,to reach 60 percent of the collected waters Increase drinking water capacityIncrease coverage of agricultural irrigation

Mexico-EU Trade Links is a monthly informational newsletter published by the Mexican Mission to the EU, Representati-ve office of the Ministry of the Economy. Av. Franklin Roosevelt 94, 1050, Brussels, Belgium. For more detailed information or questions regarding this issue please contact us: e-mail bruselas@economia.gob.mx, fax: 32 (02) 644 04 45, or visit our website at: http://www.economia-bruselas.gob.mx

4

Mexico’s Official Gazette Notices

• 02/08/2007 Decree to amend articles 29, 73, 90, 92, 93, 95, 110 and 111 of the Political Constitution of the United Mexican States

• 15/08/2007 Agreement publishing the China's proto-col of accession to the World Trade Organization (WTO)

• 17/08/2007 Agreement determining the additional quota for powder milk imports in 2006, imported from State members of the WTO

• 30/08/2007 Agreement creating the temporary mo-dality of transborder cargo transport between Mexi-co and the United States of America

EU Official Journal

• 04/08/2007 L204 Agreement between the European Union and the United States of America on the pro-cessing and transfer of Passenger Name Record (PNR) data by air carriers to the United States De-partment of Homeland Security (DHS) (2007 PNR Agreement)

• 18/08/2007 2007/563/CE Commission Decision of 1 August 2007 amending Decision 2006/504/EC on special conditions governing certain foodstuffs im-ported from certain third countries due to contamina-tion risks of these products by aflatoxins as regards almonds and derived products originating in or con-signed from the United States of America (notified under document number C(2007) 3613)

• 28/08/2007 2007/C200/02 Non-opposition to a noti-fied concentration (Case COMP/M.4265 — Phi-lips/Avent)

• 28/08/2007 2007/C200/03 Non-opposition to a noti-fied concentration (Case COMP/M.4475 — Schnei-der Electric/APC)

• 29/08/2007 2007/592/CE Commission Decision of 24 August 2007 amending Decision 2006/656/EC as regards the list of territories from which imports of tropical ornamental fish into the Community are aut-horised (notified under document number C(2007) 3960)

Trade fairs and exhibits in Mexico

MEGA EXPO FRANQUICIAS 2007 October 3-5, 2007 Centro Banamex, Mexico City Franchise Fair Phone : (52) 55 5575-5600 Website: http://www.mef.com.mx/ EXPO TU BODA October 5-7, 2007 World Trade Center, Mexico City. Exhibition of the best products for wedding events Event Management: INTEREXPOS Phone : 01800 0062266 Website: http://www.nosotros2.com/expotuboda/mexico/mexico.aspx

EXPO CIHAC 2007 October 16- 20, 2007 Centro Banamex, Mexico City International building and housing exhibition Event Management: CIHAC Phone: (52) 55 5661-0844 Fax : (52) 55 5661-3445 E-mail: expo@cihac.com.mx Website: http://www.cihac.com.mx

EXPO SALUD Y BIENESTAR October 18-21, 2007 World Trade Center, Mexico City. Health, beauty and fitness exhibition Event Management: Trade Show Phone : (52) 5545-6860 E-mail: adrianzg@expodeljardin.com Wesbite: http://www.expo-salud.com.mx/