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The Q112 BMI Mexico Retail report forecasts the countrys retail sales to grow from an expected MXN2,323bn (US$196.85bn) in 2011 to MXN2,675bn (US$257.88bn) by 2015, a rise of 15.2%. Increasing affluence, a growing population – including a larger number of young people – and the continuing development of organised retail infrastructure are the key factors behind the forecast growth in Mexicos retail sales.

Mexicos nominal GDP is predicted to be US$1,151.0bn in 2011, with real GDP growth of 4.0% y-o-y expected for the year. Average annual GDP growth of 2.6% is predicted by BMI between 2011 and 2015. With the population forecast to increase from 114.8mn in 2011 to 120.1mn by 2015, GDP per capita is expected to reach US$14,514 by the end of our forecast period.

Mexico is the worlds 11th largest country in terms of population. Almost 55% of Mexicans are 24 years old or younger, one of the highest percentages for an upper-middle-income economy in the world. The proportion in the 20-44 age range, which is crucial for retail sales, was estimated at 41.5% at the end of 2010, according to the UN Population Division. In 2005, 63.6% of Mexicans were described by the UN as economically active, and this reached 66.3% in 2010. The trend towards urbanisation is predicted to continue, with the proportion of those living in towns and cities already estimated at 77.4% in 2010.

Consumer credit grew strongly in the years up to 2008. In 2006, banks approved 8.7mn credit cards, awarding 40% of new accounts to customers with no previous credit history. There were estimated to be 29mn credit cards in circulation in Mexico during 2008, up from an estimated 22mn in 2007. The number of debit cards is estimated at 11mn. However, access to credit tightened considerably during 2009.

Retail sub-sectors forecast to show strong growth include food and drink, which is forecast to grow 41.5%, from a predicted US$67.90bn in 2011 to US$96.06bn in 2015.

Consumer electronic sales are expected to increase by 32.1% between 2011 and 2015, from US$11.12bn to US$14.69bn. The Mexican market offers continued growth potential in key digital products groups such as computers (which have less than 20% penetration), notebook computers (21% compound annual growth rate projected), digital cameras (9%) and LCD TV sets (20% compound annual growth rate projected).

Vehicle sales are forecast to rise 33.4% during the forecast period, from 914,414 units to 1,219,824 units. There is significant optimism for a strong recovery in domestic demand for cars after Volkswagen estimated that it achieved a 25% year-on-year (y-o-y) rise in sales in 2010 to US$8bn.

Over-the-counter (OTC) pharmaceutical sales are forecast to rise by 48.5% between 2011 and 2015, from US$1.59bn to US$2.36bn.

Retail sales for our Latin American universe in 2011 are expected to reach US$1,344bn, based on varying national definitions. Total consumer spending for the region, based on BMIs macroeconomic database, is predicted to be US$3,004bn. Brazil and Mexico are expected to account for an estimated 74.0% of regional retail sales in 2011, with the two countries still likely to account for 72.5% of all retail sales in the region by 2015. Mexicos predicted 2011 market share of 14.6% is expected to fall to 13.1% by 2015.