Toy trades advance.

Mexico's Ministry of the Economy is preparing a programme to enhance the industry's competitiveness, drawing largely on imports of toy components, accessories, motors and parts, machinery, moulds and raw materials - many products coming from the Chinese mainland.

The attraction is that these imports will be duty free.

Local producers are believed to have developed a new strategy by establishing alliances with the Chinese mainland by integrating local assembly and distribution with imported components, to create price advantages.

Another approach is to import licensed products, brands or designs to help establish competitive value goods.

At the recent Toys Expo 2005 in Mexico City, Mexican Association of Toys Industry president Miguel Angel Martin said the domestic market is valued at US$2 billion, of which up to 65% is represented by imported goods.

This weighting is due to the fact that imported toys with integrated electronic components do not attract anti-dumping duties, he said.

The Mexican toy industry has recently begun to perk up, with a growth of 7% in 2004 over the previous year, the rapidly improving economy and the presence of an enormous internal market, consisting of 32 million kids up to the age of 14.

Martin expects upcoming joint venture announcements between Mexican and Chinese or Spanish partners. One recent milestone was the deal between Spanish producer Molto and a Mexican manufacturer to produce goods in Mexico for export to the US.

from Vicky Acevedo, Mexico City Consultant