BBVA Chair Carlos Torres Vila stated that “Mexico is going to be a clear winner in the current context” in which U.S. companies are moving production to closer regions. This trend, known as ‘nearshoring’, is going to accelerate due to the tax incentives the U.S. has designed to promote investment in the fight against climate change in the country (the Inflation Reduction Act, or IRA). He stressed this at CERAWeek, the benchmark global event for the energy sector, which is being held in Houston throughout this week.
“We are the largest bank in Mexico and we’re seeing how Mexico is going to be a clear winner,” the BBVA Chair said. The investments that have already been announced regarding the manufacturing of electric cars in Mexico by U.S. companies are a clear example of the business opportunity that sustainability represents for the country. Mexico also has very significant natural resources for the fight against climate change like the sun and lithium reserves, he noted.
Carlos Torres Vila spoke highly of both the IRA in the U.S., as well as Europe’s efforts to incentivize climate investments on a scale in which “both sides of the Atlantic are dedicating a few percentage points of GDP, about four percent of GDP, to push the energy transition.” In his opinion, both approaches are aligned in the same direction, although the simplicity, incentive system and the long-term nature of the IRA are good lessons for Europe.
Carlos Torres Vila during his speech at Ceraweek.
Decarbonization poses a formidable challenge, he emphasized, especially for emerging countries, which “have immense potential” and can also be “clear winners” like Mexico. Schemes are needed to get the capital flowing toward these markets, the BBVA Chair added.
Sustainability is a strategic priority for BBVA, and a key pillar of growth for the Group, Carlos Torres Vila explained. In 2022, BBVA channeled €50 billion of sustainable financing. This new business is growing so quickly that the bank tripled the initial sustainable finance goal to €300 billion between 2018 and 2025. Furthermore, the bank has set intermediate decarbonization targets for 2030 in six sectors (the power sector, the automotive sector, steel, cement, coal and oil and gas).
Carlos Torres Vila during his speech at the benchmark global event for the energy sector, which is being held in Houston throughout this week.
At this edition of CERAWeek, which brings together the world’s biggest energy companies every year, Carlos Torres Vila participated in a plenary session entitled ‘Financing the energy transition’. He shared the panel with the Chair of Carlyle International Energy Partners, Marcel van Poecke; the Vice President and CFO of Petronas, Liza Mustapha; the CEO of Beyond Net Zero, Lance Uggla; and the Vice President of S&P Global, Roger Diwan.