When it comes to Latin America, Brazil and its respective funds (such as the $7 billion iShares MSCI Brazil Index (ARCA:EWZ)), takes the cake in many portfolios. With its abundant natural resources, growing middle class and strong government, it is no wonder why Brazil is considered the poster child for growth in the region. However, while most investor attention for Latin America has gone to Brazil, another somewhat forgotten LATAM country is quickly regaining its title as a manufacturing powerhouse. Spring breakers and tequila aside, Mexico could be one the brightest gems in the region and could make a great portfolio addition.

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A Burgeoning Export Leader
Despite being the 14th-largest economy in the world and second largest in Latin America, much of investor's perception of Mexico is tainted by its recent drug-related headlines. However, for those investors willing to look past those headlines, the developing market nation is quickly emerging as a manufacturing powerhouse.

Trade now represents 60% of Mexico's GDP and more than 80% of its exports are manufactured goods. That figure has quietly tripled since 1980 and has strengthened even more since the implantation of NAFTA. According to Mexico's official statistics agency, manufacturing exports hit a record high of $25 billion back in April. That's nearly a 2.5% increase versus March's numbers on a seasonally adjusted basis. Leading the charge was the nation's automobile sector as well as heavy goods production.

However, Mexico's manufacturing export story is just getting started. First, much of Mexico's competitive edge stems from a weak peso policy. Since 1987, the peso has fallen down 1,500% against the dollar. Secondly, China's huge advantage in labor costs is evaporating. Given China's yuan appreciation and recent worker strikes, Mexico's wages now are only 12% higher than the Asian Dragon's. Adding in logistical issues and transportation costs and Mexico's advantage begins to take shape.

That advantage is estimated to continue growing. According to analysts at HSBC, China will continue to lose U.S. market share as the loss of competitiveness in wages, currency appreciation and rising shipping costs take hold. Mexico will eventually catch up to China and Canada, and become the top U.S. trading partner by 2018. Some investors believe that the nation will be a gateway to the rest of Latin America as well.

SEE: Global Trade And The Currency Market

Playing the LATAM Superstar
Adding in the fact that Mexico is rich in farmland, silver and copper, the nation's export-driven economy could be exactly what investors need. However, despite the nation's size and strengths, there is only one broad way to play its emerging economy. The iShares MSCI Mexico Investable ETF (ARCA:EWW) tracks 43 different Mexican firms, including beverage producer Coca Cola FEMSA (NYSE:KOF) and retailer Walmex (OTCBB:WMMVY). The fund has managed to produce a 14.17% annual return since its inception in 1996 and only charges 0.52% in expenses. Overall, the iShares fund makes a great overall play on Mexico's growth.

Operating in 17 countries and having 246 million wireless subscribers, America Movil (NYSE:AMX) is a telecommunications powerhouse that is still growing. Run by billionaire Carlos Slim, the wireless provider has recently made some big acquisitions, such as offering $3.5 billion for a bigger stake in Dutch telecoms company KPN. Shares of the firm yield a healthy 1.1% and represent the dominant wireless player in LATAM.

For investors who want to focus on Mexico's industrial muscle, both CEMEX (NYSE:CX) and Grupo Simec (AMEX:SIM) make ideal choices. CEMEX is one of the world's largest cement and building aggregate producer, while Simec is a leading manufacturer of structural steel products. Both stocks have sold off as the concerns about global growth have taken hold, but currently represent values. Simec currently can be had for a P/E of less than seven.

SEE: Should You Buy Stock Or An ETF?

The Bottom Line
While many investors look towards Brazil for their Latin America exposure, Mexico could be a better bet. The nation is quickly emerging as a manufacturing and exporting powerhouse. With its labor and transportation cost advantages firmly in tow, the nation is poised to be a leader over the next few years. For investors, the previous firms as well as Grupo Aeroportuario del Sureste (NYSE:ASR), make ideal choices to play its growth.

At the time of writing, Aaron Levitt did not own shares in any of the companies mentioned in this article.