Mexico’s foreign direct investment rose 48% in the first quarter from regular flows recorded during the same time last year, the latest sign that corporate nearshoring efforts are contributing to the country’s export boom.

Investment surged to $18.6 billion over the first three months of 2023, according to preliminary data Mexico’s Economy Ministry released on Sunday. The percentage increase from a year ago excludes the merger of media companies Grupo Televisa SAB and Univision Holdings Inc. and the restructuring of Grupo Aeromexico SAB, the ministry said.

The sharp rise occurred as businesses have funneled money into Mexico in an effort to move closer to North American consumers.

Aside from the capital, no state received more money than Nuevo Leon’s $2.3 billion. Jalisco received $1.2 billion, while Puebla and Mexico State followed with $0.9 billion each. The majority of the investment growth came from companies that expanded existing operations in Mexico.

“The greatest part of the foreign direct investment was reinvestment in utilities, which is related to the increase in the capacity of plants already installed by companies, and explained by the long-term perspective on export growth,” said Gabriela Siller, director of economic analysis at Banco Base.

The movement of companies from other parts of the world to just south of the US — a practice known as nearshoring — has generated buzz around Mexico’s production possibilities. Nearly $10 billion of the investment went to the manufacturing sector, while $6 billion went into financial services.

If the current pace continues, total investment for the year could reach $43 billion, Siller said. That would represent a 51% gain in total foreign direct investment from 2022 after $6.9 billion from the media merger and Aeromexico restructuring is excluded.