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Also important to note is that more than 95% of Mexico’s population primarily speaks Spanish and it is considered Mexico’s official language. It was reported in 1995, that only 5.5 million of Mexico’s population spoke at least one of the 62 indigenous languages that exist in Mexico. However, an astounding 85% of Mexico’s population was reported to be bilingual (Everyculture.com, 2017). UDAP will definitely need to label and package their products with both Spanish and English instructions. However, with Mexico’s bilingual rate being so high,
EXPORT BUSINESS PLAN: UDAP Industries, Inc.11labeling the products with both languages shouldn’t create an issue and consumers should be able to read product instructions with ease.Political EnvironmentMexico’s political environment functions as a federal republic system operating under a government that is centralized. Similar to the U.S., Mexican government powers are divided between legislative, judicial, and executive branches at the federal level. Every six years, Mexico holds elections for a president who is elected by popular vote. There is also a Senate with 128 members, a Supreme Court branch, and one governor for each of the thirty-one federation states (Everyculture.com, 2017). Mexico’s government has made public security a key issue moving forward in an effort tosuppress crime and drug-related violence. Organized and petty crime has increased in the last couple of decades. As previously reported in this plan, the homicide rate alone in Mexico is five times higher than that of the U.S. (CBSNews.com, 2016). Also, Mexican police and judicial systems are perceived as ineffective and lack public credibility because their people view them as corrupt. The Mexican political environment favors the exportation of self-defense products like UDAP’s pepper spray. UDAP Industries Inc. will satisfy consumer’s needs for self-defense products against crime when they export and offer their products to Mexico. Although there are basically no tariff barriers hindering the U.S. from exporting to Mexico, UDAP’s pepper spray is considered a sensitive product. This means that they will have to classify their product correctly (according to their Harmonized System (HS) code number) so that it can be easily identified by the Mexican government. UDAP will be required to obtain an import license because the
EXPORT BUSINESS PLAN: UDAP Industries, Inc.12Mexican government agency called The Secretariat of National Defense (SEDENA) requires thatthey have one in order to export in any material that could be classified as a weapon (Export.gov,2016). For specific tax purposes, UDAP will also need to apply to be registered in the Official Register of Importers. UDAP will also want to get a North American Free Trade Agreement (NAFTA) Certificate of Origin for their products. Lastly, UDAP will need to apply to the Secretariat of Treasury and Public Finance to have their product listed on an industry registry (Export.gov, 2016).