Mexico has impressive bilateral relations with the Russian Federation. During the last decade, Mexico has been exploring new opportunities with its partners in this part of Europe, in particular, with Russia. In this interview, Ambassador Extraordinary and Plenipotentiary of Mexico to the Russian Federation, H.E. Norma Pensado Moreno, talks about the key priorities, challenges and the economic changes that could possibly influence future bilateral directions of Mexico-Russia.
Interview Excerpts follow:
Q:What are your Government’s priorities in and expectations from the Russian Federation?
NPM: Mexico´s Government issued new objectives of foreign policy; one of them is building stronger relations with our partners beyond North America. In this endeavor, Eastern Europe plays a key role. Moreover, due to its dynamism during the last decade, Mexico has a special interest in exploring new cooperation opportunities with its partners in this part of Europe, in particular with Russia.
For Mexico and the Russian Federation, there is great potential in their bilateral relationship. In 2017 and 2018, considerable progress was made in its political dialogue and cooperation in various areas, but a real deepening still remains, mainly in the economic field, in order to match the size of its economies, being both among the 15 biggest in the world.
Both countries are of decisive importance in their respective regions. Within the group of Latin American countries, Mexico occupies an important place for Russia’s foreign policy agenda. For Mexico, Russia is a country with high political, scientific, cultural, energy, tourist, investment and commercial potential.
The bilateral dialogue between the two countries has focused on the Mechanism of Political Consultations, official reciprocal visits, exchange and cooperation (educational, cultural, scientific and technical), energy, economy, trade and tourism. Mexico and Russia agree on positions in many International Forums and on principles such as the promotion of multilateralism. In this context, they have prioritized the issues of international security, the pacific use of cosmic space, the fight against drug trafficking and transnational crime.
The bilateral relationship is in a very good dynamic, due to the presidential meetings in BRICS and APEC summits, as well as the meetings of foreign ministers, in August and November of 2017. The celebration of the V Joint Commission of Cooperation in Culture, Education and Sports took place last February after many years, and the VI Economic Commission Mexico-Russia is expected to take place during 2019.
In short, our Government priorities and expectations are to continue and deepen the cooperation Mexico and the Russian Federation have both in our bilateral relationship in all areas and in the multilateral agenda, as well as to exploring new cooperation in areas such as energy and telecommunications, in which Russia has strengths.
Q: Do you have the same business agenda in other ex-Soviet republics where you are accredited?
NPM: I am also accredited as Ambassador to Armenia and Belarus. Overall, Mexico’s business agenda is similar in the three countries. We want to expand trade, promote investments and connect our business community to their counterparts in these countries through the organization of business missions and participation in commercial promotional events. It is also a common goal in the three countries to promote Mexico as a tourist destination.
However, we have also set specific goals based on the prospects identified in each country. Russia is a big country and it represents a wide scope of opportunities. In the case of our Armenian counterparts, we have talked about the many opportunities in the IT and renewable energies sectors. As for Belarus, we are aware of its potential in the production of tractors and agriculture machines as well as in its new industrial technologies. We need to do some work to translate this flow of information into real opportunities that can be explored by our business communities.
Q: Could you please discuss the level of Russia’s economic engagement in Mexico? Is your Government satisfied with Russia’s investment interest as compared to, most probably, other foreign players in Mexico?
NPM: Both Russia and Mexico are conscious that there is significant room to grow in our bilateral economic relations given the size of our economies and the possibilities of complementarity. We want to increase economic exchanges and investments.
That said, I want to highlight that Russia has made significant steps regarding its economic engagement in Mexico. It is Mexico’s most important investment partner among Eastern European countries, with a total investment of $20.9 million between 1999 and 2017. There are Russian investments in more than 80 Mexican companies, in fields such as transportation, hotels, and mining.
In June 2017, as a result of Mexico’s public tender process in its oil industry, Lukoil was awarded an exploration and extraction contract in the Gulf of Mexico. In March 2018, the company announced that, in consortium with the Italian company Eni, it had been awarded another contract. This consolidates its presence in Mexico since it started to cooperate with Pemex in 2014.
Last year Minister of Trade and Industry visited Mexico heading a business delegation in sectors such as aerospace, automotive, equipment and energy. And this October, the Deputy Minister of Trade and Industry also went to Mexico with a delegation of companies in the construction sector. I can thus say that we see a positive trend in Russia’s engagement in Mexico and we hope it will remain.
Q: On the other hand, how does Mexico engage Russia? How do you view the possibility of effective trade exchanges between the two countries?
NPM: Mexican investment in Russia is also growing. In 2017 Gruma, one of the biggest producers of tortillas and other agro products opened a plant in the Moscow region with an investment of $50 million. Other companies with presence in the country are Kidzania –with an entertainment center in the Moscow region- and Nemak –with a manufacturing center for automotive components in Zavolzhie, near Ulyanovsk. Also, the Mexican air company Interjet has acquired several Russian-developed units, the Sukhoi SuperJet-100.
In addition, different Mexican governmental agencies have been encouraging Mexican producers from the agricultural sector to explore opportunities in the Russian market. As a result, representatives from more than twenty companies have visited Russia in the last four months to get acquainted with potential partners. We had a big delegation in Moscow last June, within the framework of the FIFA World Cup, and the second one in mid-September, which attended the World Food fair in Moscow.
Therefore, I can confidently say that there is keen interest from the Mexican side to strengthen its economic ties with Russia. Our goal is to translate all these steps into a substantial growth in trade exchanges.
Q: How is Mexico’s tourism business developing in Russia? Are the number of Russian tourists increasing compared to the previous years? What strategies have you adopted to further popularize your country’s recreational destinations?
NPM: One of the main priorities of the Government of Mexico is tourism. Thanks to the efforts of our government in this area, in 2017 Mexico ranked sixth in the world in reception of foreign tourists, according to the World Tourism Organization, with almost 40 million visitors (39.3 million). Out of this amount, only 37,300 Russian visitors entered Mexico by airplane (an increase of 21.5% in comparison to 2016); it means less than 0.1% of all the tourists we received last year; even if it is increasing, it does not correspond to the importance of Russia in the world.
We strive for having again the numbers we had in 2013 when almost 108,000 Russians visited Mexico. The good news is that in the first 8 months of 2018, Mexico received more Russian visitors than in the whole 2017. If this trend continues we will receive more than 50,000 Russian tourists at the end of the year -something not seen since 2014-, it means almost 65% more than two years ago.
For the coming years, we are confident that the number of Russians who will visit Mexico will continue increasing thanks to the actions implemented by the Government of Mexico to popularize my country in Russia, among them:
1) the organization or participation in events aimed at the main Russian tour operators; 2) the participation in tourism exhibitions in Russia; 3) the publication of brochures or information in Russian language including the version in this language of the Website of our Tourism Office, which will be in force in the next weeks.
In this framework, a key role play the recent visit to Russia of more than 45,000 Mexican football fans to attend the World Cup who brought with them our “Fiesta”, something that Russians liked very much and has motivated them to visit Mexico in the near future.
Q: What are views about economic changes in Russia and the Eurasian region? And how would the changes possibly influence future directions in economic cooperation in Mexico?
NPM: We closely follow the economic developments in Russia, Armenia, and Belarus, including the regional integration efforts within the Eurasian Economic Union. We are aware of the challenges the countries are facing, but also of the opportunities that are being open. We want to focus on the opportunities. As I mentioned before, the interest in deepening economic relations is mutual and is growing. We will carry on with the work that has been done in the last years.
In the case of Russia, we have still to agree on a date for the next meeting of the Economic Intergovernmental Commission, which will be key to strengthen our cooperation framework. Experts from the two countries are engaged in processes that we hope will lead to the reopening of the Russian market for Mexican beef and seafood products. The trends are very positive, and we can remain optimistic in that regard.