2. MARKET ANALYSIS
2.1. Industry Overview
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2. MARKET ANALYSIS
2.1.
Industry Overview
In Mexico, the industry for Chinese Language Learning is very limited and virtually inexistent;
the more adequate category would be generally, Language Learning, as a whole. In which English has the most dominant position.
Despite its shared border with the United States, Mexico has a challenge with limited English language proficiency. It ranks below several other Latin American nations for English ability8. A study conducted for 6 years found that the percentage of adults that are able of speaking another language is 13%. Although a generational gap was found; meanwhile 19% of adults under the age of 30 were proficient on a second language, among adults above 50 years of age, the percentage was only of 6%9.
In Mexico, factors like education level or socio-economic position are determining when accessing to another language; this is clear when we observe that 38% of University students are proficient in a second language, a tendency that is repeated in the 33% that belongs to higher socioeconomic level and is proficient in a second language10.
Urbanization also has an important role when accessing to studies in a second language. In urban zones, 16% of the population claims being proficient in another language, meanwhile in rural zones, the part of the population that can speak a second language amounts only to the
8 Mexican Institute for Competitiveness (IMCO)
9 Consulta Mitofsky. ¿Habla usted otro idioma además del español? 2015. www.consulta.mx/¿Habla usted otro idioma además del español?
10 Ibidem
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4%11.
This as well translates into a small population for people who can effectively train English language, let alone, any other language. We find paramount to fill those spots with Taiwanese natives since local practitioners lack the proficiency to be trainers.
A 2015 study by the British Council – English in Mexico: An examination of policy, perceptions and influencing factors12 – found that the size of the language learning market in the country is approximately 23.9 million people, including every level and type of study from public schools to private institutions to self-access channels. This is equivalent to about 21% of the Mexican population.
Having not coming to existence a dominant institution or system that dominates the Chinese language teaching part of the industry, our institution can position itself as the institution that grabs the position. Additionally, the lack of statistically significant data to assess the potential impact of Chinese language in Mexico, data retrieved from a study made by the British Council indicates that people who had learnt English did it: 45% to improve their employment prospects;
43% as they needed to acquire English as a skill for university; 22% as it allowed them to access more information sources; 11% as it was necessary for their job, 9% to travel, 8% as they were encouraged by their friends and family, 8% so they could create a wider personal and professional network, 3% said it could help them gain social standing13.
11 Ibidem
12 English in Mexico: An examination of policy, perceptions and influencing factors. British Council. May 2015
13 English in Mexico: An examination of policy, perceptions and influencing factors. British Council. May 2015.
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Figure 1. Why Did You Study English.
Source: British Council, Education Intelligence, Latin America Databank 2014
Figure 1 shows that the Mexican consumer, in search for proficiency in a foreign language expects an improvement in their professional career. And it has been true, Mexico and China, for example compete nowadays as a manufacturing country, disputing the market in the United States of America. China is the second place, after United States of America, as country of origin of Mexican imports14
It has been a recurring topic in the 2017-2018 political landscape the renegotiation of the North American Free Trade Agreement (NAFTA), the implementation of sanctions and tariffs for products going into the United States and even a symbol of the current presidency in the United States has been the construction of a wall in the southern border of the United States of America.
14 MIT. “Origins- Mexico,” Observatory of Economic Complexity.
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It seems to be a divorce between the Mexican and American economies.
Thus, two potential solutions circulate among the public opinion. The first consist in strengthening the domestic market. In other words, it is needed that Mexico consumes more from the local industries to detonate new business opportunities. The second solution pretends to promote the diversification of the Mexican international commerce, taking greater advantage of the existing commercial treaties, and seeking for new ones. Countries like Japan, Germany and China have reached to Mexico in a display of support.
More specifically, Mexico and China have built bridges from 2001 to 2006 to facilitate the creation of binational committees that will establish permanent dialogue mechanisms15. Despite all the complications and tribulations, the decision of keeping an open dialogue between Mexico and China provides certain degree of certainty, necessary to face the challenges brought by the Trump Administration in the United States. The Sino-Mexican relationship is reaching a stage of maturity.
Not having a proper player for the language training industry in Mexico that specializes in the instruction of Chinese language, given the socio-politic moment we are going through, represents an opportunity for our company to successfully stablish and more importantly, to thrive in the Mexican Market.