Dive Brief:
- Two of the giants of the food industry announced at the World Economic Forum in Davos that they would pour billions into Mexico.
- PepsiCo said it would spend $5 billion over five years to expand business in Mexico. The soft drink and snack giant plans to add manufacturing capacity and extend delivery routes.
- Nestle said it would spend $1 billion to build two new factories in Mexico, and to expand an existing facility there.
Dive Insight:
We don't hear a lot of good news out of Mexico these days, so it's wonderful to learn that these two companies will create roughly 4,700 jobs in that troubled land. Good jobs remain far too rare in Mexico.
But the most interesting thing about this news isn't job creation, it's the timing. Just weeks ago, the country added hefty taxes to soft drinks, high-calorie snacks, and pet food — the exact sort of things that Pepsi and Nestle make.
Perhaps this is an indication that neither Pepsi nor Nestle thinks the taxes are here to stay. Or, more likely, it is an indication that the companies believe higher taxes won't help Mexicans change their diets.