The Walmart of Mexico is set to lay off 1,100 employees after the Mexican government approved a $6bn investment in a food-processing factory.
The move comes as the country prepares to kick off the country’s biggest economic turnaround in decades.
The factory, set to be opened in 2019, is expected to generate 2,500 jobs.
It will be the largest in Mexico.
The Mexican government is considering whether to invest more than $3bn into the plant.
Walmart has said it will build a new plant in the US to export its food products to the US.
The deal will save the company some $700m, according to a Walmart spokesman.
Walmart’s Mexican operations are already the world’s largest exporter of organic foods, and it has been expanding its operations to the region.