The Financial Times reviews global cities annually, categorizing them based on various factors from economic potential and lifestyle to cost-effectiveness. Each global city (grouped as large- and medium-size) was assessed to create the same set of data eventually resulting in the list for 2021/2022. San Luis Potosi, a 1.2 million-inhabitant city in Central Mexico, won itself an upscale position from both economic potential and cost-effectiveness.

San Luis Potosi

San Luis Potosi is the capital of the state of San Luis Potosi in Mexico. Its population in 2021 is 911,908 people, with more than 1.2 million living in the agglomeration of four municipalities.

San Luis Potosi is located in the central part of Mexico, 1860 meters above sea level on a plateau near the Eastern Sierra Madre Mountains. The city is also directly bordered by mountains to the south and west, and some streets already climb these mountains.

FDI Awards – Economic Potential

The Financial Times Business Intelligence Team closely analyzed 20 different data points describing the overall economic potential of the city. Each participating location was measured on a scale of 10 for each aspect, weighted based on their significance, arranged for subcategories and the global list. The Mid/Small City category, in which San Luis Potosi ranked well for two subcategories, was reserved for locations with a population below 2 million.

The economic activities of San Luis Potosi are driven by mechanical engineering, mining, the food industry, the construction industry, and agriculture. Like many Mexican states and cities that surround Mexico City, San Luis Potosi’s most profitable economic activity is focused on growth in the manufacturing industry. As a key milestone, a new BMW facility is manufacturing the BMW 3 Series since 2019. Thanks to the $1 billion investment, the Mexican assembly plant will play a significant role in BMW Group’s growth within the NAFTA region, setting a new standard of sustainability in the industry as the group’s most innovative plant.

San Luis Potosi was able to get ahead of cities, like Antwerp (NL), Düsseldorf (DE), and Edinburgh (UK), due to the remarkable amount of Foreign Direct Investment flowing in the area. The TOP 5 companies in the region are BMW Group, Honeywell, Robert Bosch, General Motors, and 3M, all contributing to the development of the local ecosystem through their intensive need for suppliers.

FDI Awards – Cost-Effectiveness

16 important factors have been measured to result in the 9th place of San Luis Potosi on the Cost-Effectiveness list. As a still-developing region, the city and the surrounding area offer both cheap land and office space prices, and a highly affordable workforce. While the average US annual wage in 2018 was $64,000, its Mexican counterpart was only $16,200. While the Mexican tax system does not lure in companies as countries, as Cyprus does, its value-added tax is only 16%, which creates a predictable and transparent environment.

The above two awards point out correctly that San Luis Potosi has great potential for further economic growth, and although it is less transparent compared to Eastern Europe and the Middle East, the availability of the cheaper, yet educated and professional workforce will be the engine of growth for the foreseeable future.

In Mexico, San Luis Potosi is the preferred national logistics center. The city has excellent railway, highway and aerial infrastructure that connects it to the main exporting ports in Mexico, the U.S. and Canada, for these and many other reasons, the state is an excellent place to invest.