Cemex 1997 Annual Report Download - page 16

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10
A positive year
for North
American markets
1997 was a positive year for CEMEX’ North
American markets. Mexico’s economy contin-
ued to improve at a healthy pace, recording 7%
GDP growth for the year. The main drivers of
this growth were significant foreign investment,
increased consumer confidence and strong
macroeconomic fundamentals. These funda-
mentals included a current account surplus,
lower inflation and real wage growth.
This year, we expect Mexico’s GDP to rise
around 5.0%. We do not anticipate significant
downward pressure on the country’s continuing
recovery as a result of Southeast Asia’s econom-
ic downturn. The nation’s economic perfor-
mance is linked to that of the U.S., which buys
approximately 80% of Mexico’s annual exports.
1997 marked the United States economy’s
sixth consecutive year of GDP growth. Histori-
cally low inflation, low unemployment and
interest rates, coupled with increased produc-
tivity, led to a 3.7% rise in GDP for the year.
This year, we expect GDP growth of about
2.6%. The U.S. economic fundamentals remain
strong. Inflation remains under control, while
interest rates and unemployment continues at
historic lows. However, the expanding U.S.
trade deficit due to depressed prices in Asian
markets may slow overall economic growth.
"It's the most global company in
Latin America. It's made suc-
cessful investments outside of
its primary market, has a good
man-agement team and can
compete with major competi-
tors around the world."
Jean-Dominique Virchaux, Heidruck
& Struggles (Latin Trade, 1/98)
NORTH AMERICA OPERATIONAL REVIEW
Quality role model
Tepeaca plant in Puebla.
A role model for Mexican industry, the
Tepeaca plant was selected out of a pool
of 85 contestants to receive the National
Quality Award. CEMEX also received the
National Exports Award for excellence in
export practices, customer service, pro-
curement and logistics.