Information about Economy Of Mexico
The economy of Mexico was the 14th largest in the world in 2006[1] with a gross domestic product (by PPP estimate) that surpassed a trillion dollars in 2004,[2] measured in purchasing power parity. Mexico has a free market and export-oriented economy and is firmly established as an upper middle-income country with the highest income per capita in Latin America, in market exchange rates. Mexico is the only Latin American member of the Organisation for Economic Co-operation and Development.
Since the 1994 crisis, administrations have improved the country's macroeconomic fundamentals. Mexico was not significantly influenced by the recent 2002 South American crisis, and has maintained positive, although low, rates of growth after a brief period of stagnation in 2001. Moody's (in March 2000) and Fitch IBCA (in January 2002) issued investment-grade ratings for Mexico's sovereign debt. In spite of its unprecedented macroeconomic stability, which has reduced inflation and interest rates to record lows and has increased per capita income, huge gaps remain between the urban and the rural population, the northern and southern states, and the rich and the poor.[2] Some of the government's challenges include the upgrade of infrastructure, the modernization of the tax system and labor laws, and the reduction of income inequality.
The economy contains a mixture of modern and outmoded industry and agriculture, both of which are increasingly dominated by the private sector. Recent administrations have expanded competition in ports, railroads, telecommunications, electricity generation, natural gas distribution and airports, with the aim of upgrading infrastructure. As an export-oriented economy, more than 90% of Mexican trade is under free trade agreements (FTAs) with more than 40 countries, including the European Union, Japan, Israel, and much of Central and South America. The most influential FTA is NAFTA, which came into effect in 1994, and was signed in 1992 by the governments of the United States, Canada and Mexico. In 2006, trade with Mexico's two northern partners accounted for almost 90% of its exports and 55% of its imports.[1]
After five decades of political turbulence following the independence of Mexico, the four consecutive administrations of president Porfirio DÃaz (during the last quarter of the nineteenth century) brought unprecedented economic growth. This growth was accompanied by foreign investment and European immigration, the development of an efficient railroad network and the exploitation of the country's natural resources. GDP per capita levels circa 1900 were on par with Argentina and Uruguay, almost three times that of Brazil and Venezuela.[3] Annual economic growth between 1876 and 1910 averaged 3.3%.[4] Political repression and fraud, as well as huge income inequalities exacerbated by the land distribution system based on latifundios, in which large haciendas were owned by a few but worked by millions of underpaid peasants living in precarious conditions, led to the Mexican Revolution (1910–1917), an armed conflict that drastically transformed Mexico's political, social, cultural, and economical structure during the twentieth century under a premise of social democracy. The war itself, however, left a harsh toll in the economy and population, which decreased over the 11-year period between 1910 and 1921. The reconstruction of the country was to take place in the following decades.
The period from 1930 to 1970 was dubbed by economic historians as the "Mexican Miracle", a period of economic growth spurred by a model of import-substitution industrialization (ISI) which protected and promoted the development of national industries. Through the ISI model, the country experienced an economic boom through which industries rapidly expanded their production.[5] Important changes in the economic structure included free land distribution to peasants under the concept of ejido, the nationalization of the oil and railroad companies, the introduction of social rights into the constitution, the birth of large and influential labor unions, and the upgrading of infrastructure. While population doubled from 1940 to 1970, GDP increased sixfold.[6]
The ISI model had reached its peaked in the late 1960s. During the 1970s, the administrations of EcheverrÃa and López Portillo, tried to include social development in their policies, an effort that entailed more public spending. With the discovery of vast oil fields in a time in which oil prices were surging and international interest rates were low -and even negative- the government decided to borrow from international capital markets to invest in the state-owned oil company, which in turn seemed to provide a long-run income source to promote social welfare. In fact, this method produced a remarkable growth in public expenditure,[5] and president López Portillo announced that the time had come to learn to "manage prosperity"[7] as Mexico multiplied its oil production to become the world's fourth largest exporter.[8]
In the period of 1981–1982 the international panorama changed abruptly: oil prices plunged and interest rates rose. In 1982, president López Portillo, just before ending his administration, suspended payments of foreign debt, devalued the peso and nationalized the banking system, along with many other industries that were severely affected by the crisis, among them the steel industry. While import substitution had produced an era of industrialization in previous decades, by the 1980s it was evident that that protracted protection had produced an uncompetitive industrial sector with low productivity gains.[5]
President de la Madrid was the first of a series of presidents that began to implement neoliberal reforms. After the crisis of 1982, lenders were unwilling to return to Mexico and, in order to keep the current account in balance, the government resorted to currency devaluations, which in turn sparked unprecedented inflation,[5] which reached a historic high in 1987 at 159.7%.[10]
The first step toward the liberalization of trade was Mexico's signature of GATT in 1986. During the Salinas administration many state-owned companies were privatized. In 1992, the North American Free Trade Agreement was signed between the United States, Canada and Mexico, and after the signature of two additional supplements on environments and labor standards, it came into effect on January 1, 1994. Salinas also introduced strict price controls and negotiated smaller minimum wage increments with labor unions with the aim of curbing inflation. While his strategy was successful in reducing inflation, growth averaged only 2.8 percent a year.[5] Moreover, by fixing the exchange rate, the peso became rapidly overvalued while consumer spending increased, causing the current account deficit to reach 7% of GDP in 1994. The deficit was financed through tesobonos a type of public debt instrument that reassured payment in dollars.[11] The Chiapas uprising, and the assassinations of the ruling party's presidential candidate, Luis Donaldo Colosio and the Secretary-General of the party and brother of the Assistant-Attorney General José Francisco Ruiz Massieu in 1994, sent a disquieting message to investors. Public debt holders rapidly sold their tesobonos, depleting the Central Bank's reserves,[11] while portfolio investments, which had made up 90% of total investment flows, left the country as fast as they had come in.[5] This unsustainable situation eventually forced the entrant Zedillo administration to abandon the fixed exchange rate. The peso sharply devalued and the country entered into an economic crisis in December 1994. The boom in exports, as well as an international rescue package crafted by American president Bill Clinton, helped cushion the crisis. In less than 18 months, the economy was growing again, and annual rate growth averaged 5.1 percent between 1995 and 2000.[5]
President Zedillo and president Fox continued with trade liberalization and during his administrations several FTAs were signed with Latin American and European countries, Japan and Israel, and both strove to maintain macroeconomic stability. Thus, Mexico became one of the most open countries in the world to trade, and the economy base shifted accordingly. Total trade with the United States and Canada tripled, and total exports and imports almost quadrupled between 1991 and 2003.[12] The nature of foreign investment also changed from portfolio to foreign-direct investment (FDI).
The Mexican currency is the peso (ISO 4217: MXN; symbol: $). One peso is divided into 100 centavos (cents). MXN replaced MXP in 1993 at a rate of 1000 MXP per 1 MXN. The exchanged rate has remained stable since 1998, oscillating between 9.20 and 11.50 MXN per USD. Interest rates in 2007 were situated at around 7 percent,[16] having reached a historic low 2002 below 5 percent. Inflation rates are also at historic lows; the inflation rate in Mexico in 2006 was 4.1 percent. Unemployment rates are the lowest of OECD countries at 3.2 percent. However, underemployment is estimated at 25 percent.[1] Mexico's Human development index was reported at 0.821,[17] (comprising a life expectancy index of 0.84, an education index of 0.86 and a GDP index of 0.77), ranking 53 in the world within the group of high-development.
In terms of share in GDP per sector (in 2004), the largest contributors in agriculture are Jalisco (9.7%), Sinaloa (7.7%) and Veracruz (7.6%); the greatest contributors in industrial production are the Federal District (15.8%), Mexico (11.8%) and Nuevo León (7.9%); the greatest contributors in the service sector are also the Federal District (25.3%), Mexico (8.9%) and Nuevo León (7.5%).[20]
Since the 1980s, the economy has slowly become less centralized; the annual rate of GDP growth of the Federal District from 2003–2004 was the smallest of all federal entities at a mere 0.23%, with drastic drops in the agriculture and industrial sectors. Nonetheless, it still accounts for 21.8% of the nation's GDP. The states with the highest GDP growth rates are Quintana Roo (9.04%), Baja California (8.89%), and San Luis Potosà (8.18%).[21] In 2000, the federal entities with the highest GDP per capita in Mexico were the Federal District (US $17,696), Campeche (US $13,153) and Nuevo León (US $13,033); the states with the lowest GDP per capita were Chiapas (US $3,302), Oaxaca (US $3,489) and Guerrero (US $4,112).[22]
After the Mexican Revolution Mexico began an agrarian reform, based on the 27th article of the Mexican Constitution than included transfer of land and/or free land distribution to peasants and small farmers under the concept of the ejido.[23] This program was further extended during president Cárdenas administration during the 1930s[24] and continued into the 1960s at varying rates.[25] This cooperative agrarian reform, which guaranteed small farmers a means of subsistence livelihood, also caused land fragmentation and lack of capital investment, since commonly held land could not be used as collateral. In an effort to raise rural productivity and living standards, this constitutional article was amended in 1992 to allow for the transfer of property rights of the communal lands to farmers cultivating it.[26] With the ability to rent or sell it, a way was open for the creation of larger farms and the advantages of economies of scale. Large mechanized farms are now operating in some northeastern states (mainly in Sinaloa). However, privatization of ejidos continues to be very slow in the central and southern states where the great majority of peasants produce only for subsistence.
Since the 1994 crisis, administrations have improved the country's macroeconomic fundamentals. Mexico was not significantly influenced by the recent 2002 South American crisis, and has maintained positive, although low, rates of growth after a brief period of stagnation in 2001. Moody's (in March 2000) and Fitch IBCA (in January 2002) issued investment-grade ratings for Mexico's sovereign debt. In spite of its unprecedented macroeconomic stability, which has reduced inflation and interest rates to record lows and has increased per capita income, huge gaps remain between the urban and the rural population, the northern and southern states, and the rich and the poor.[2] Some of the government's challenges include the upgrade of infrastructure, the modernization of the tax system and labor laws, and the reduction of income inequality.
The economy contains a mixture of modern and outmoded industry and agriculture, both of which are increasingly dominated by the private sector. Recent administrations have expanded competition in ports, railroads, telecommunications, electricity generation, natural gas distribution and airports, with the aim of upgrading infrastructure. As an export-oriented economy, more than 90% of Mexican trade is under free trade agreements (FTAs) with more than 40 countries, including the European Union, Japan, Israel, and much of Central and South America. The most influential FTA is NAFTA, which came into effect in 1994, and was signed in 1992 by the governments of the United States, Canada and Mexico. In 2006, trade with Mexico's two northern partners accounted for almost 90% of its exports and 55% of its imports.[1]
History
After five decades of political turbulence following the independence of Mexico, the four consecutive administrations of president Porfirio DÃaz (during the last quarter of the nineteenth century) brought unprecedented economic growth. This growth was accompanied by foreign investment and European immigration, the development of an efficient railroad network and the exploitation of the country's natural resources. GDP per capita levels circa 1900 were on par with Argentina and Uruguay, almost three times that of Brazil and Venezuela.[3] Annual economic growth between 1876 and 1910 averaged 3.3%.[4] Political repression and fraud, as well as huge income inequalities exacerbated by the land distribution system based on latifundios, in which large haciendas were owned by a few but worked by millions of underpaid peasants living in precarious conditions, led to the Mexican Revolution (1910–1917), an armed conflict that drastically transformed Mexico's political, social, cultural, and economical structure during the twentieth century under a premise of social democracy. The war itself, however, left a harsh toll in the economy and population, which decreased over the 11-year period between 1910 and 1921. The reconstruction of the country was to take place in the following decades.
The period from 1930 to 1970 was dubbed by economic historians as the "Mexican Miracle", a period of economic growth spurred by a model of import-substitution industrialization (ISI) which protected and promoted the development of national industries. Through the ISI model, the country experienced an economic boom through which industries rapidly expanded their production.[5] Important changes in the economic structure included free land distribution to peasants under the concept of ejido, the nationalization of the oil and railroad companies, the introduction of social rights into the constitution, the birth of large and influential labor unions, and the upgrading of infrastructure. While population doubled from 1940 to 1970, GDP increased sixfold.[6]
The ISI model had reached its peaked in the late 1960s. During the 1970s, the administrations of EcheverrÃa and López Portillo, tried to include social development in their policies, an effort that entailed more public spending. With the discovery of vast oil fields in a time in which oil prices were surging and international interest rates were low -and even negative- the government decided to borrow from international capital markets to invest in the state-owned oil company, which in turn seemed to provide a long-run income source to promote social welfare. In fact, this method produced a remarkable growth in public expenditure,[5] and president López Portillo announced that the time had come to learn to "manage prosperity"[7] as Mexico multiplied its oil production to become the world's fourth largest exporter.[8]
| Average annual GDP growth by period | ||
|---|---|---|
)
| ||
| President Cárdenas | ||
| 1900–1929 | 3.4% | |
| 1929–1945 | 4.2% | |
| 1945–1972 | 6.5% | |
| 1972–1981 | 5.5% | |
| 1981–1996 | 1.5% | |
| 1995–2000 | 5.1% | |
| Sources:[9] and[5] | ||
In the period of 1981–1982 the international panorama changed abruptly: oil prices plunged and interest rates rose. In 1982, president López Portillo, just before ending his administration, suspended payments of foreign debt, devalued the peso and nationalized the banking system, along with many other industries that were severely affected by the crisis, among them the steel industry. While import substitution had produced an era of industrialization in previous decades, by the 1980s it was evident that that protracted protection had produced an uncompetitive industrial sector with low productivity gains.[5]
President de la Madrid was the first of a series of presidents that began to implement neoliberal reforms. After the crisis of 1982, lenders were unwilling to return to Mexico and, in order to keep the current account in balance, the government resorted to currency devaluations, which in turn sparked unprecedented inflation,[5] which reached a historic high in 1987 at 159.7%.[10]
The first step toward the liberalization of trade was Mexico's signature of GATT in 1986. During the Salinas administration many state-owned companies were privatized. In 1992, the North American Free Trade Agreement was signed between the United States, Canada and Mexico, and after the signature of two additional supplements on environments and labor standards, it came into effect on January 1, 1994. Salinas also introduced strict price controls and negotiated smaller minimum wage increments with labor unions with the aim of curbing inflation. While his strategy was successful in reducing inflation, growth averaged only 2.8 percent a year.[5] Moreover, by fixing the exchange rate, the peso became rapidly overvalued while consumer spending increased, causing the current account deficit to reach 7% of GDP in 1994. The deficit was financed through tesobonos a type of public debt instrument that reassured payment in dollars.[11] The Chiapas uprising, and the assassinations of the ruling party's presidential candidate, Luis Donaldo Colosio and the Secretary-General of the party and brother of the Assistant-Attorney General José Francisco Ruiz Massieu in 1994, sent a disquieting message to investors. Public debt holders rapidly sold their tesobonos, depleting the Central Bank's reserves,[11] while portfolio investments, which had made up 90% of total investment flows, left the country as fast as they had come in.[5] This unsustainable situation eventually forced the entrant Zedillo administration to abandon the fixed exchange rate. The peso sharply devalued and the country entered into an economic crisis in December 1994. The boom in exports, as well as an international rescue package crafted by American president Bill Clinton, helped cushion the crisis. In less than 18 months, the economy was growing again, and annual rate growth averaged 5.1 percent between 1995 and 2000.[5]
President Zedillo and president Fox continued with trade liberalization and during his administrations several FTAs were signed with Latin American and European countries, Japan and Israel, and both strove to maintain macroeconomic stability. Thus, Mexico became one of the most open countries in the world to trade, and the economy base shifted accordingly. Total trade with the United States and Canada tripled, and total exports and imports almost quadrupled between 1991 and 2003.[12] The nature of foreign investment also changed from portfolio to foreign-direct investment (FDI).
Macroeconomic, financial and welfare indicators
| Macroeconomic indicators | |
|---|---|
| Mexican notes and coins | |
| GDP (PPP) | US $1.134 trillion (2006) |
| GDP growth | 4.8% (2006) |
| GDP per capita | US $10,600 (2006) |
| GNI per capita | US $7,310 (2005) |
| Inflation (CPI) | 3.9% (2007) |
| Gini index | 49.5 |
| Unemployment | 3.2 % (2006) |
| HDI | ){kind=icon} 0.821 |
| Labor force | 38.09 million |
Main indicators
Mexico's Gross Domestic Product (GDP) in purchasing power parity (PPP) was estimated at US $1.134 trillion in 2006, and 741.5 billion in nominal exchange rates.[1] As such, its standard of living, as measured in GDP in PPP per capita was US $10,600. The World Bank reported that the country's Gross National Income and income per capita in nominal market exchange rates were the highest in Latin America, at US $753.394 billion,[13] and US $7,310[14] respectively, and as such, Mexico is now firmly established as an upper middle-income country. After the slowdown of 2001 the country has recovered and has grown 4.2, 3.0 and 4.8 percent in 2004, 2005 and 2006,[15] even though it is considered to be well below Mexico's potential growth.[11]The Mexican currency is the peso (ISO 4217: MXN; symbol: $). One peso is divided into 100 centavos (cents). MXN replaced MXP in 1993 at a rate of 1000 MXP per 1 MXN. The exchanged rate has remained stable since 1998, oscillating between 9.20 and 11.50 MXN per USD. Interest rates in 2007 were situated at around 7 percent,[16] having reached a historic low 2002 below 5 percent. Inflation rates are also at historic lows; the inflation rate in Mexico in 2006 was 4.1 percent. Unemployment rates are the lowest of OECD countries at 3.2 percent. However, underemployment is estimated at 25 percent.[1] Mexico's Human development index was reported at 0.821,[17] (comprising a life expectancy index of 0.84, an education index of 0.86 and a GDP index of 0.77), ranking 53 in the world within the group of high-development.
Poverty
After the 1994–1995 economic crisis, probably the most severe in the country's history, 50% of the population fell into poverty. A rapid growth in exports propitiated by NAFTA and other trade agreements, and the restructuring of the macroeconomic finances initiated during Zedillo's and continued during Fox's administration had significant results in the reduction of the poverty rate. According to the World Bank, extreme poverty was reduced to 17.6% in 2004. Most of this reduction was achieved in rural communities whose rate of poverty declined from 42% to 27.9% in the 2000–2004 period, although urban poverty stagnated at 11%.[18]Regional economies
Regional disparities and income inequality continue to be a problem in Mexico. While all constituent states of the federation have a Human Development Index (HDI) superior to 0.70 (medium to high development), northern and central states have higher levels of HDI than the southern states. Nuevo León and the Federal District have HDI levels similar to European countries, whereas that of Oaxaca and Chiapas is similar to that of Syria or Egypt.[19] At the municipal level, disparities are even greater: Garza GarcÃa in Nuevo León has an HDI similar to that of Italy, whereas, Metlatonoc in Guerrero, would have an HDI similar to that of Malawi. The majority of the federal entities with high development (superior to 0.80) are located in the northern region (with the exception of Jalisco, Aguascalientes, the Federal District, Querétaro, as well as the southeastern states of Quintana Roo and Campeche). The less developed states (with medium development in terms of HDI, superior to 0.70) are located at the southern Pacific coast (with the exception of Veracruz).In terms of share in GDP per sector (in 2004), the largest contributors in agriculture are Jalisco (9.7%), Sinaloa (7.7%) and Veracruz (7.6%); the greatest contributors in industrial production are the Federal District (15.8%), Mexico (11.8%) and Nuevo León (7.9%); the greatest contributors in the service sector are also the Federal District (25.3%), Mexico (8.9%) and Nuevo León (7.5%).[20]
Since the 1980s, the economy has slowly become less centralized; the annual rate of GDP growth of the Federal District from 2003–2004 was the smallest of all federal entities at a mere 0.23%, with drastic drops in the agriculture and industrial sectors. Nonetheless, it still accounts for 21.8% of the nation's GDP. The states with the highest GDP growth rates are Quintana Roo (9.04%), Baja California (8.89%), and San Luis Potosà (8.18%).[21] In 2000, the federal entities with the highest GDP per capita in Mexico were the Federal District (US $17,696), Campeche (US $13,153) and Nuevo León (US $13,033); the states with the lowest GDP per capita were Chiapas (US $3,302), Oaxaca (US $3,489) and Guerrero (US $4,112).[22]
Components of the economy
Gross Domestic Product (GDP) in purchasing power parity (PPP) in 2006 was estimated at US $1.134 trillion, and GDP per capita in PPP at US $10,600.[1] The service sector is the largest component of GDP at 70.5%, followed by the industrial sector at 25.7% (2006 est.). Agriculture represents only 3.9% of GDP (2006 est.). Mexican labor force is estimated at 38 million of which 18% is occupied in agriculture, 24% in the industry sector and 58% in the service sector (2003 est.).Agriculture and food production
| Food and agriculture | ||
|---|---|---|
)
| ||
| Farmers in Puebla | ||
| Product | Quantity (Tm) | World Rank1 |
| Avocados | 1,040,390 | 1 |
| Onions and chayote | 1,130,660 | 1 |
| Limes and lemons | 1,824,890 | 1 |
| Safflower seed | 212,765 | 1 |
| Dry fruits | 95,150 | 2 |
| Papaya | 955,694 | 2 |
| Chillies and peppers | 1,853,610 | 2 |
| Whole beans | 93 000 | 3 |
| Oranges | 3,969,810 | 3 |
| Anise, badian, fennel | 32 500 | 3 |
| Chicken meat | 2,245,000 | 3 |
| Asparagus | 67,247 | 4 |
| Mangoes | 1.503.010 | 4 |
| Corn | 20,000,000 | 4 |
| 1Source:FAO[1] | ||
Up until the 1990s, the government encouraged the production of basic crops (mainly corn and beans) by maintaining support prices and controlling imports through the National Company for Popular Subsistence (CONASUPO). With trade liberalization, however, CONASUPO was to be gradually dismantled and two new mechanisms were implemented: Alianza and Procampo. Alianza provides income payments and incentives for mechanization and advanced irrigation systems. Procampo is an income transfer subsidy to farmers. This support program provides 3.5 million farmers who produce basic commodities (mostly corn), and which represent 64% of all farmers, with a fixed income transfer payment per unit of area of cropland. This subsidy increased substantially during president president Fox's administration, mainly to white corn producers in order to reduce the amount of imports from the United States. This program has been successful, and in 2004, roughly only 15% of corn imports are white corn –the one used for human consumption and the type that is mostly grown in Mexico– as opposed to 85% of yellow and crashed corn –the one use for feeding livestock, and which is barely produced in Mexico.[27]
Agriculture, as a percentage of GDP, has been steadily declining, and now resembles that of developed nations, in that it plays a smaller role in the economy. In 2006, agriculture accounted for only 3.9% of GDP,[1] down from 7% in 1980,[28] and 25% in 1970.[29] Nonetheless, given the historic structure of ejidos, it still employs a considerably high percentage of the work force: 18% in 2003,[1] mostly of which grows basic crops for subsistence, compared to 2–5% in developed nations in which production is highly mechanized.
In spite of being a staple in Mexican diet, Mexico's comparative advantage in agriculture is not in corn, but in horticulture, tropical fruits and vegetables. Negotiators of NAFTA expected that through liberalization and mechanization of agriculture two-thirds of Mexican corn-producers would naturally shift from corn production to horticultural and other labor-intensive crops such as fruits, nuts, vegetables, coffee and sugar cane.[30] While horticultural trade has drastically increased due to NAFTA, it has not absorbed displaced workers from corn production (estimated at around 600,000).[27] Moreover, corn production has remained stable (at 20 million metric tons), arguably, as a result of income support to farmers, or a reticence to abandon a millenarian tradition in Mexico: not only have peasants grown corn for millennia, corn originated in Mexico. Even today, Mexico is still the fourth largest corn producer in the world.[22]
Industry
| Industrial production | ||
|---|---|---|
| Fundidora Park in Monterrey | ||
| Main industries | Automobile industry, petrochemicals, cement and construction, textiles, food and beverages, mining, consumer durables, tourism | |
| Industrial growth rate | 3.6% (2006) | |
| Labor force | 24% of total labor force | |
| GDP of sector | 25.7% of total GDP | |
Some large industries of Mexico include Cemex, the third largest cement conglomerate in the world;[33] the alcohol beverage industries, including world-renowned players like Grupo Modelo; conglomerates like FEMSA, which apart from owning breweries and the OXXO convenience store chain, is also the second-largest Coca-Cola bottler in the world; Gruma, the largest producer of corn flour and tortillas in the world; and Bimbo, Telmex, Televisa, among many others. In 2005, according to the World Bank, high-tech industrial production represented 19,6% of total exports.[34]
Maquiladoras (Mexican factories which take in imported raw materials and produce goods for export) have become the landmark of trade in Mexico. This sector has benefited from NAFTA, in that real income in the maquiladora sector has increased 15.5% since 1994, though from the non-maquiladora sector has grown much faster.[11] Contrary to popular belief, this should be no surprise since maquiladora's products could enter the US duty free since the 1960s industry agreement. Other sectors now benefit from the free trade agreement, and the share of exports from non-border states has increased in the last 5 years while the share of exports from maquiladora-border states has decreased. Currently Mexico is focusing in developing an aerospace industry and the assembly of helicopter and regional jet aircraft fuselages is taking place.
Energy and mineral resources
Mineral resources are the "nation's property" (i.e. public property) by constitution. As such, the energy sector is administered by the government with varying degrees of private investment. Mexico is the fifth-largest oil producer in the world, with 3.8 million barrels per day.[35] Pemex, the public company in charge of administering research, exploitation and sales of oil, is the largest company (oil or otherwise) in Latin America, making US $86 billion in sales a year,[36] a sum larger than the GDP of some of the region's countries. Nonetheless, the company is heavily taxed, a significant source of revenue for the government, of almost 62 per cent of the company's sales.[5] Without enough money to continue investing in finding new sources or upgrading infrastructure, and being protected constitutionally from private and foreign investment, some have predicted the company may face institutional collapse.[5] While the oil industry is still relevant for the government's budget, its importance in GDP and exports has steadily fallen since the 1980s. In 1980 oil exports accounted for 61.6% of total exports; by 2000 it was only 7.3%.[12]Services
The service sector was estimated to account for 70.5% of the country's GDP, and employs 58% of the active population.[1] This section includes transportation, commerce, warehousing, restaurant and hotels, arts and entertainment, health, education, financial and banking services, telecommunications as well as public administration and defense. Mexico's service sector is strong, and in 2001 it replaced Brazil's as the largest service sector in Latin America in dollar terms.[37]Tourism is one of the most important industries in Mexico. It is the fourth largest source of foreign exchange for the country.[38] Mexico is the eight most visited country in the world (with over 20 million tourist a year).[39]
According to the IMF the Mexican banking system is strong, in which private banks are profitable and well-capitalized.[40] The financial and banking sector is increasingly dominated by foreign companies or mergers of foreign and Mexican companies with the notable exception of Banorte. The acquisition of Banamex, one of the oldest surviving financial institutions in Mexico, by Citigroup was the largest US-Mexico corporate merger, at US $12.5 billion.[41] In spite of that, the largest financial institution in Mexico is Bancomer associated to the Spanish BBVA.[42]
The process of institution building in the financial sector in Mexico has evolved hand in hand with the efforts of financial liberalization and of inserting the economy more fully into world markets.[43] Over the recent years, there has been a wave of acquisitions by foreign institutions such as US-based Citigroup, Spain’s BBVA and the UK’s HSBC. Their presence, along with a better regulatory framework, has allowed Mexico’s banking system to recover from the 1994–95 peso devaluation. Lending to the public and private sector is increasing and so is activity in the areas of insurance, leasing and mortgages.[44] However, bank credit accounts for only 22% of GDP, which is significantly low compared to 70% in Chile.[45] Credit to the Agricultural sector has fallen 45.5% in six years (2001 to 2007), and now represents about 1% of total bank loans.[46]
Other important institutions include savings and loans, credit unions, government development banks, “non-bank banks”, bonded warehouses, bonding companies and foreign-exchange firms.[44]
Securities market
Mexico has a single securities market, the Mexican Stock Exchange (Bolsa Mexicana de Valores, known as the Bolsa). The market has grown steadily, with its main indices increasing by more than 150% in 2003–05. It is Latin America's second largest exchange, after Brazil's. Still, the Bolsa remains relatively small when compared to other North American exchanges. The New York Stock Exchange is about 100 times larger; the Toronto Stock Exchange is six times larger.The Indice de Precios y Cotizaciones (IPC, the general equities index) is the benchmark stock index on the Bolsa. In 2005 the IPC surged 37.8%, to 17,802.71 from 12,917.88, backed by a stronger Mexican economy and lower interest rates. It continued its steep rise through the beginning of 2006, reaching 19,272.63 points at end-March 2006. The stockmarket also posted a record low vacancy rate, according to the central bank. Local stockmarket capitalisation totalled US$236bn at end-2005, up from US$170bn at end-2004. As of March 2006 there were 135 listed companies, down from 153 a year earlier. Only a handful of the listed companies are foreign. Most are from Mexico City or Monterrey; companies from these two cities compose 67% of the total listed companies.
The IPC consists of a sample of 35 shares weighted according to their market capitalisation. Heavy hitters are America Telecom, the holding company that manages Latin America’s largest mobile company, América Móvil; Telefonos de Mexico, Mexico’s largest telephone company; Grupo Bimbo, Mexico and Latin America’s biggest baker; and Wal-Mart de México, a subsidiary of the US retail giant. The makeup of the IPC is adjusted every six months, with selection aimed at including the most liquid shares in terms of value, volume and number of trades.
Mexico’s stockmarket is closely linked to developments in the US. Thus, volatility in the New York and Nasdaq stock exchanges, as well as interest-rate changes and economic expectations in the US, can steer the performance of Mexican equities. This is both because of Mexico’s economic dependence on the US and the high volume of trading in Mexican equities through American Depositary Receipts (ADRs). Currently, the decline in the value of the dollar is making non-US markets, including Mexico's, more attractive.
Despite the recent gains, investors remain wary of making placements in second-tier initial public offerings (IPOs). Purchasers of new issues were disappointed after prices fell in numerous medium-sized companies that made offerings in 1996 and 1997. IPO activity in Mexico remains tepid and the market for second-tier IPOs is barely visible. There were three IPOs in 2005.[47]
Remittances
Remittances, or contributions sent by Mexicans living abroad, mostly in the United States, to their families at home in Mexico, are a substantial and growing part of the Mexican economy; they comprised $18 billion in 2005.[48] In 2004, they became the second largest source of foreign income after crude oil exports, roughly equivalent to foreign direct investment (FDI) and larger than tourism expenditures; and represented 2.5 percent of the nation's Gross Domestic Product.[49] The growth of remittances has been remarkable: they have more than doubled since 1997. Recorded remittance transactions exceeded 41 million in 2003, of which 86 percent were made by electronic transfer.[38]It is estimated that half or more of Mexican immigrants to the United States are legal, and have access to formal transfer channels usually blocked to illegals simply due to the lack of accepted identification documents. The Mexican government, cognizant of the economic viability of immigrant workers, began issuing an upgraded version of the MatrÃcula Consular de Alta Seguridad (MACS, High Security Consular Identification), an identity document issued at Mexican consulates abroad. This document is now accepted as a valid identity card in 32 US states, as well as thousands of police agencies, hundreds of cities and counties, as well as banking institutions.[38]
The main receptors of remittances in 2004 were the states of Michoacán, Guanajuato, Jalisco, Mexico and Puebla, which jointly captured 45% of total remittances in that year.[49] Several state governments, with the support of the federal government, have implemented programs to use part of the remittances to finance public works. This program, called Dos por Uno (Two for every one) is designed in a way that for each peso contributed by migrants from their remittances, the state and the federal governments will invest two pesos in building infrastructure at their home communities.[50]
Government policies and the Central Bank
| Financial indicators | ||
|---|---|---|
| Banco de México headquarters | ||
| Currency exchange rate | 10.76 MXN per 1 USD (May, 2007) | |
| Reserves including gold | US $85.01 billion (2006) | |
| Government budget | US $196.5 billion (revenues) | |
| Public debt | 20.7% of GDP (2006) | |
| External debt | US $178.3 billion (2006) | |
| Bank funding rate | 7% (2/2007) | |
Currency policy
Mexico has had a floating exchange-rate regime since the December 1994 peso devaluation. Under this system, Banco de México makes no commitment to the level of the peso exchange rate, although it does employ an automatic mechanism to accumulate foreign reserves. It also possesses tools aimed at smoothing out volatility. The Exchange Rate Commission sets policy; it is made up of six members—three each from the Ministry of Finance and Public Credit (SecretarÃa de Hacienda y Crédito Publico—SHCP) and the central bank, with the SHCP holding the deciding vote.In August 1996, Banco de México initiated a mechanism to acquire foreign reserves when the peso is strong, without giving the market signals about a target range for the exchange rate. The resulting high levels of reserves, mostly from petroleum revenues, have helped to improve the terms and conditions on debt Mexico places on foreign markets. However, there is concern that the government relies too heavily on oil income in order to build a healthy base of reserves. According to the central bank, international reserves stood at US $75.8 billion in 2007.[52] In May 2003, Banco de México launched a program that sells U.S. dollars via a monthly auction, with the goal of maintaining a stable, but moderate, level of reserves.
Monetary system
Mexico’s monetary policy was revised following the 1994–95 financial crisis, when officials decided that maintaining general price stability was the best way to contribute to the sustained growth of employment and economic activity. As a result, Banco de México has as its primary objective maintaining stability in the purchasing power of the peso. It sets an inflation target, which requires it to establish corresponding quantitative targets for the growth of the monetary base and for the expansion of net domestic credit.The central bank also monitors the evolution of several economic indicators, such as the exchange rate, differences between observed and projected inflation, the results of surveys on the public and specialists’ inflation expectations, revisions on collective employment contracts, producer prices, and the balances of the current and capital accounts.
A debate continues over whether Mexico should switch to a US-style interest rate-targeting system. Government officials in favor of a change say that the new system would give them more control over interest rates, which are becoming more important as consumer credit levels rise. The change would imply eliminating the corto (lit. "shortage") a mechanism that allows the central bank to influence market interest rates by leaving the banking system short of its daily demand for money by a predetermined amount. If the central bank wants to push interest rates higher, it increases the corto. If it wishes to lower interest rates, it decreases the corto. The corto is criticised for its lack of transparency and its tenuous hold overrates. Currently, Mexico is the only country in the OECD that tries to influence interest rates in such a way.[44]
Trade
| International trade | ||
|---|---|---|
)
| ||
| World Trade Center in Mexico City | ||
| Exports | US $248.8 billion f.o.b. (2006) | |
| Imports | US $253.1 billion f.o.b. (2006) | |
| Current account | ){kind=icon} US $400.1 million (2006) | |
| Export partners | US 85.7%, Canada 2%, Spain 1.4% (2005) | |
| Import partners | US 53.4%, China 8%, Japan 5.9% (2005) | |
Free trade agreements
Mexico joined GATT in 1986, and today is an active and constructive participant of the World Trade Organization. Fox's administration promoted the establishment of a Free Trade Area of the Americas; Puebla served as temporary headquarters for the negotiations, and several other cities are now candidates for its permanent headquarters if the agreement is reached and implemented.Mexico has signed 12 free trade agreements with 43 countries:
- NAFTA (1994) with the United States and Canada;
- Grupo de los tres, Group of the three [countries], or G-3 (1995) with Colombia and Venezuela; the latter decided to terminate the agreement in 2006; Mexico announced its intention to invite Ecuador, Peru or Panama as a replacement;
- Free Trade Agreement with Costa Rica (1995);
- Free Trade Agreement with Bolivia (1995);
- Free Trade Agreement with Nicaragua (1998);
- Free Trade Agreement with Chile (1999);
- Free Trade Agreement with the European Union (2000);
- Free Trade Agreement with Israel (2000);
- TN Free Trade Agreement (2001), with Guatemala, El Salvador and Honduras;
- Free Trade Agreement with the European Association of Free Trade, integrated by Iceland, Norway, Liechtenstein and Switzerland (2001);
- Free Trade Agreement with Uruguay (2004); and
- Free Trade Agreement with Japan (2005)
NAFTA
The NAAEC agreement was a response to environmentalists' concerns that companies would relocate to Mexico or the United States would lower its standards if the three countries did not achieve a unanimous regulation on the environment. The NAAEC, in an aim to be more than a set of environmental regulations, established the North American Commission for Environmental Cooperation (NACEC), a mechanism for addressing trade and environmental issues, the North American Development Bank (NADBank) for assisting and financing investments in pollution reduction and the Border Environmental Cooperation Commission (BECC). The NADBank and the BECC have provided economic benefits to Mexico by financing 36 projects, mostly in the water sector. By complementing NAFTA with the NAAEC, it has been labeled the "greenest" trade agreement.[58]
The NAALC supplement to NAFTA aimed to create a foundation for cooperation among the three members for the resolution of labor problems, as well as to promote greater cooperation among trade unions and social organizations in order to fight for the improvement of labor conditions. Though most economists agree that it is difficult to assess the direct impact of the NAALC, it is agreed that there has been a convergence of labor standards in North America. Given its limitations, however, NAALC has not produced (and in fact was not intended to achieve) convergence in employment, productivity and salary trend in North America.[58]
The overall benefits of NAFTA have been quantified by several economists, whose findings have been reported in several publications like the World Bank's Lessons from NAFTA for LA and the Caribbean,[58] NAFTA's Impact on North America,[59] and NAFTA revisited by the Institute for International Economics.[11] They assess that NAFTA has been positive for Mexico, whose poverty rates have fallen, and real income salaries have risen even after accounting for the 1994–1995 Economic Crisis. Nonetheless, they also state that it has not been enough, or fast enough, to produce an economic convergence nor to reduce the poverty rates substantially or to promote higher rates of growth. Some have suggested that in order to fully benefit from the agreement Mexico should invest in education and promote innovation as well as in infrastructure and agriculture.[58]
Given the overall size of trade between Mexico and the United States, there are remarkably few trade disputes, involving relatively small dollar amounts. These disputes are generally settled in WTO or NAFTA panels or through negotiations between the two countries. The most significant areas of friction involve trucking, sugar, high fructose corn syrup, and a number of other agricultural products.[29]
See also
References
1. ^ [https://www.cia.gov/library/publications/the-world-factbook/geos/mx.html#Econ The World Factbook CIA World Factbook]. Retrieved on February 19, 2007.
2. ^ Mexico, World Bank's Country Brief. Retrieved on February 19, 2007.
3. ^ Perry, G.E.; J.H. López & WF. Maloney et al. (2006), Poverty Reduction and Growth: Virtuous and Vicious Cycles, Washington, DC: The International Bank for Reconstruction and Development / The World Bank, pp. p.148, <[1]
4. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Desarrollo Económico. Retrieved on 2007-02-17.
5. ^ September 30, 2004">Crandall, R (September 30, 2004), "Mexico's Domestic Economy", in Crandall, R; G Paz & R Roett, Mexico's Democracy at Work: Political and Economic Dynamics, Lynne Reiner Publishers, ISBN 10-1588263002
6. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Retos y perspectivas de la EconomÃa Mexicana en el Siglo XXI (PPT). Universidad Veracruzana. Retrieved on 2007-02-16.
7. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Legislatura LIII - Año I - PerÃodo Ordinario - Fecha 19850910 - Número de Diario 19. Crónicas del Congreso de la Unión. Retrieved on 2007-02-16.
8. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)José López Portillo y Pacheco 1920-2004. Retrieved on 2007-02-16.
9. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Cruz Vasconcelos, Gerardo. Desempeño Histórico 1914–2004 (PDF). Retrieved on 2007-02-17.
10. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Valuación Peso Dolar 1970–2006. Retrieved on 2007-02-16.
11. ^ Hufbauer, G.C. & J.J . Schott (October, 2005), "Chapter 1, Overview", NAFTA Revisited: Achievements and Challenges, Washington, DC: Institute for International Economics, pp. 1–78, ISBN 0-88132-334-9, <[2]
12. ^ September 30, 2004">Gereffi, G & M MartÃnez (September 30, 2004), "Mexico's Economic Transformation under NAFTA", in Crandall, R; G Paz & R Roett, Mexico's Democracy at Work: Political and Economic Dynamics, Lynne Reiner Publishers, ISBN 10-1588263002
13. ^ Total GNI Atlas Method 2005, World Bank (PDF). Retrieved on 2007-02-16.
14. ^ GNI per capita 2005, Atlas method and PPP, World Bank (PDF). Retrieved on 2007-02-16.
15. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Reporte ECLAC (PDF). Retrieved on 2007-02-16.
16. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Tasas de Interés, Banco de México. Retrieved on 2007-02-16.
17. ^ United Nations Human Development Report, 2006. Retrieved on 2007-02-16.
18. ^ Mexico: Income Generation and Social Protection for the Poor. Retrieved on 2007-02-16.
19. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Programa de las Naciones Unidas para el Desarrollo (2005). "Informe sobre desarrollo humano, México, 2004" (PDF). United Nations. Retrieved on 2007-02-16.
20. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)INEGI. Producto interno bruto por entidad federativa. Participación sectorial por entidad federativa. Retrieved on 2007-02-16.
21. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)INEGI. Producto interno bruto por entidad federativa. Variación anual. Retrieved on 2007-02-16.
22. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)CONAPO. Indices de Desarrollo Humano (PDF). Retrieved on 2007-02-16.
23. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Ejido. Retrieved on 2007-05-29.
24. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)SecretarÃa de Reforma Agraria. Las Transformaciones del Cardenismo. Retrieved on 2007-05-29.
25. ^ SecretarÃa de Reforma Agraria. Nuevas Demandas Campesinas. Retrieved on 2007-05-29.
26. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)SecretarÃa de Reforma Agraria. Trasformación Institucional. Retrieved on 2007-05-29.
27. ^ Zanhiser, S & W. Coyle (2004), U.S.-Mexico Corn Trade During the NAFTA Era: New Twists to an Old Story, <[3] (retrieved on 2006-09-28)
28. ^
29. ^ Hufbauer, G.C. & J.J . Schott (October, 2005), "Chapter 5, Agriculture", NAFTA Revisited: Achievements and Challenges, Washington, DC: Institute for International Economics, pp. 283–363, ISBN 0-88132-334-9, <[4]
30. ^ Nadal, A. (2002), "Zea Mays: Effects of Trade Liberalization of Mexico's Corn Sector", in Deere, C.L., Greening the Americas, MIT Press, Cambridge, MA, ISBN-10: 0262541386
31. ^ Major Food and Agricultural Commodities and Producers. Retrieved on 2007-02-16.
32. ^ Hufbauer, G.C. & J.J . Schott (October, 2005), "Chapter 6, The Automotive Sector", NAFTA Revisited: Achievements and Challenges, Washington, DC: Institute for International Economics, pp. 1–78, ISBN 0-88132-334-9, <[5]
33. ^ Federal Trade Comission. With Conditions, FTC Allows Cemex’s Acquisition of RMC. Retrieved on 2007-05-29.
34. ^ The World Bank. Mexico Data Profile. Retrieved on 2007-05-29.
35. ^ Energy Information Administration. Top World Oil Net Exporters and Producers. Retrieved on 2007-02-16.
36. ^ América Economia. Top 500 Companies in Latin America (Requires subscription). Retrieved on 2007-02-16.
37. ^ The Mark Twain Institute. Mexico Services Sector posts strong growth, Argentina falls behind. Based on Latin Business Chronicle on Services in Latin America. Retrieved on 2007-02-16.
38. ^ Hernández-Coss, R (2005), The U.S.–Mexico Remittance Corridor: Lessons on Shifting from Informal to Formal Transfer Systems, The World Bank, <[6]
39. ^ UNTWO. World's Top Tourism Destinations (absolute numbers) (PDF). Retrieved on 2007-02-16.
40. ^ Mexico: Financial System Stability Assessment Update (PDF). Retrieved on 2007-05-29.
41. ^ Grupo Financiero Banamex. Retrieved on 2007-02-16.
42. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Acerca de Bancomer. Retrieved on 2007-02-16.
43. ^ Globalization: The Role of Institution Building in the Financial Sector. The Case of Mexico (PDF). Retrieved on 2007-02-16.
44. ^ Country Finance Main Report: April 26], 2006 (Mexico)] (Requires subscription). Retrieved on 2007-02-16.
45. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Mantiene sistema financiero baja penetración: Werner. Retrieved on 2007-02-16.
46. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Zúñiga, Juan Antonio (2006-02-20), "El crédito a la agricultura cayó 45.5% en 6 años", La Jornada, <[7]
47. ^ Country Finance Main Report: April 26th 2006 (Mexico) Securities Market Overview
48. ^ Migration Can Deliver Welfare Gains, Reduce Poverty, Says Global Economic Prospects 2006. Retrieved on 2007-02-16.
49. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Informe Anual, 2004, Banco de México. Retrieved on 2007-02-16.
50. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Fernández, E, Montaño, T.. "Migrantes aportan dinero para obras", El Universal, October 9, 2006. Retrieved on 2007-02-16. (Spanish)2006&rft.language=Spanish">
51. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Ley Monetaria de los Estados Unidos Mexicanos (PDF). Retrieved on 2007-05-29.
52. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)CF109 - Reporte sobre las reservas internacionales y la liquidez. Retrieved on 2007-05-29.
53. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Sobre México. Retrieved on 2007-02-16.
54. ^ WTO. World Trade in 2005 - Overview (PDF). Retrieved on 2007-02-16.
55. ^ With data as reported by INEGI at [8]
56. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) EFE (2006-07-21), "Espera México ser miembro del Mercosur", El Universal, <[9]
57. ^ Think Tank Proposes FTA with EU, Mexico. Retrieved on 2007-05-29.
58. ^ Hufbauer, G.C. & J.J . Schott (October, 2005), "Chapter 3, Environment", NAFTA Revisited: Achievements and Challenges, Washington, DC: Institute for International Economics, pp. 1–78, ISBN 0-88132-334-9, <[10]
59. ^ Weinstraub, S (2004). NAFTA's Impact on North America: The First Decade. CSIS Press: Washington, DC. ISBN-10: 089206451X.
60. ^ Lederman, Daniel; William F. Maloney & Luis Servén (2004). Lessons from NAFTA for Latin American and Caribbean Countries: A Summary of Research Findings. The World Bank. ISBN-10: 0821358138.
2. ^ Mexico, World Bank's Country Brief. Retrieved on February 19, 2007.
3. ^ Perry, G.E.; J.H. López & WF. Maloney et al. (2006), Poverty Reduction and Growth: Virtuous and Vicious Cycles, Washington, DC: The International Bank for Reconstruction and Development / The World Bank, pp. p.148, <[1]
4. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Desarrollo Económico. Retrieved on 2007-02-17.
5. ^ September 30, 2004">Crandall, R (September 30, 2004), "Mexico's Domestic Economy", in Crandall, R; G Paz & R Roett, Mexico's Democracy at Work: Political and Economic Dynamics, Lynne Reiner Publishers, ISBN 10-1588263002
6. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Retos y perspectivas de la EconomÃa Mexicana en el Siglo XXI (PPT). Universidad Veracruzana. Retrieved on 2007-02-16.
7. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Legislatura LIII - Año I - PerÃodo Ordinario - Fecha 19850910 - Número de Diario 19. Crónicas del Congreso de la Unión. Retrieved on 2007-02-16.
8. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)José López Portillo y Pacheco 1920-2004. Retrieved on 2007-02-16.
9. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Cruz Vasconcelos, Gerardo. Desempeño Histórico 1914–2004 (PDF). Retrieved on 2007-02-17.
10. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Valuación Peso Dolar 1970–2006. Retrieved on 2007-02-16.
11. ^ Hufbauer, G.C. & J.J . Schott (October, 2005), "Chapter 1, Overview", NAFTA Revisited: Achievements and Challenges, Washington, DC: Institute for International Economics, pp. 1–78, ISBN 0-88132-334-9, <[2]
12. ^ September 30, 2004">Gereffi, G & M MartÃnez (September 30, 2004), "Mexico's Economic Transformation under NAFTA", in Crandall, R; G Paz & R Roett, Mexico's Democracy at Work: Political and Economic Dynamics, Lynne Reiner Publishers, ISBN 10-1588263002
13. ^ Total GNI Atlas Method 2005, World Bank (PDF). Retrieved on 2007-02-16.
14. ^ GNI per capita 2005, Atlas method and PPP, World Bank (PDF). Retrieved on 2007-02-16.
15. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Reporte ECLAC (PDF). Retrieved on 2007-02-16.
16. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Tasas de Interés, Banco de México. Retrieved on 2007-02-16.
17. ^ United Nations Human Development Report, 2006. Retrieved on 2007-02-16.
18. ^ Mexico: Income Generation and Social Protection for the Poor. Retrieved on 2007-02-16.
19. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Programa de las Naciones Unidas para el Desarrollo (2005). "Informe sobre desarrollo humano, México, 2004" (PDF). United Nations. Retrieved on 2007-02-16.
20. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)INEGI. Producto interno bruto por entidad federativa. Participación sectorial por entidad federativa. Retrieved on 2007-02-16.
21. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)INEGI. Producto interno bruto por entidad federativa. Variación anual. Retrieved on 2007-02-16.
22. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)CONAPO. Indices de Desarrollo Humano (PDF). Retrieved on 2007-02-16.
23. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Ejido. Retrieved on 2007-05-29.
24. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)SecretarÃa de Reforma Agraria. Las Transformaciones del Cardenismo. Retrieved on 2007-05-29.
25. ^ SecretarÃa de Reforma Agraria. Nuevas Demandas Campesinas. Retrieved on 2007-05-29.
26. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)SecretarÃa de Reforma Agraria. Trasformación Institucional. Retrieved on 2007-05-29.
27. ^ Zanhiser, S & W. Coyle (2004), U.S.-Mexico Corn Trade During the NAFTA Era: New Twists to an Old Story, <[3] (retrieved on 2006-09-28)
28. ^
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}} 29. ^ Hufbauer, G.C. & J.J . Schott (October, 2005), "Chapter 5, Agriculture", NAFTA Revisited: Achievements and Challenges, Washington, DC: Institute for International Economics, pp. 283–363, ISBN 0-88132-334-9, <[4]
30. ^ Nadal, A. (2002), "Zea Mays: Effects of Trade Liberalization of Mexico's Corn Sector", in Deere, C.L., Greening the Americas, MIT Press, Cambridge, MA, ISBN-10: 0262541386
31. ^ Major Food and Agricultural Commodities and Producers. Retrieved on 2007-02-16.
32. ^ Hufbauer, G.C. & J.J . Schott (October, 2005), "Chapter 6, The Automotive Sector", NAFTA Revisited: Achievements and Challenges, Washington, DC: Institute for International Economics, pp. 1–78, ISBN 0-88132-334-9, <[5]
33. ^ Federal Trade Comission. With Conditions, FTC Allows Cemex’s Acquisition of RMC. Retrieved on 2007-05-29.
34. ^ The World Bank. Mexico Data Profile. Retrieved on 2007-05-29.
35. ^ Energy Information Administration. Top World Oil Net Exporters and Producers. Retrieved on 2007-02-16.
36. ^ América Economia. Top 500 Companies in Latin America (Requires subscription). Retrieved on 2007-02-16.
37. ^ The Mark Twain Institute. Mexico Services Sector posts strong growth, Argentina falls behind. Based on Latin Business Chronicle on Services in Latin America. Retrieved on 2007-02-16.
38. ^ Hernández-Coss, R (2005), The U.S.–Mexico Remittance Corridor: Lessons on Shifting from Informal to Formal Transfer Systems, The World Bank, <[6]
39. ^ UNTWO. World's Top Tourism Destinations (absolute numbers) (PDF). Retrieved on 2007-02-16.
40. ^ Mexico: Financial System Stability Assessment Update (PDF). Retrieved on 2007-05-29.
41. ^ Grupo Financiero Banamex. Retrieved on 2007-02-16.
42. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Acerca de Bancomer. Retrieved on 2007-02-16.
43. ^ Globalization: The Role of Institution Building in the Financial Sector. The Case of Mexico (PDF). Retrieved on 2007-02-16.
44. ^ Country Finance Main Report: April 26], 2006 (Mexico)] (Requires subscription). Retrieved on 2007-02-16.
45. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Mantiene sistema financiero baja penetración: Werner. Retrieved on 2007-02-16.
46. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Zúñiga, Juan Antonio (2006-02-20), "El crédito a la agricultura cayó 45.5% en 6 años", La Jornada, <[7]
47. ^ Country Finance Main Report: April 26th 2006 (Mexico) Securities Market Overview
48. ^ Migration Can Deliver Welfare Gains, Reduce Poverty, Says Global Economic Prospects 2006. Retrieved on 2007-02-16.
49. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Informe Anual, 2004, Banco de México. Retrieved on 2007-02-16.
50. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Fernández, E, Montaño, T.. "Migrantes aportan dinero para obras", El Universal, October 9, 2006. Retrieved on 2007-02-16. (Spanish)2006&rft.language=Spanish">
51. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)Ley Monetaria de los Estados Unidos Mexicanos (PDF). Retrieved on 2007-05-29.
52. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles)CF109 - Reporte sobre las reservas internacionales y la liquidez. Retrieved on 2007-05-29.
53. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) Sobre México. Retrieved on 2007-02-16.
54. ^ WTO. World Trade in 2005 - Overview (PDF). Retrieved on 2007-02-16.
55. ^ With data as reported by INEGI at [8]
56. ^ (Poverty Reduction and Growth: Virtuous and Vicious Cycles) EFE (2006-07-21), "Espera México ser miembro del Mercosur", El Universal, <[9]
57. ^ Think Tank Proposes FTA with EU, Mexico. Retrieved on 2007-05-29.
58. ^ Hufbauer, G.C. & J.J . Schott (October, 2005), "Chapter 3, Environment", NAFTA Revisited: Achievements and Challenges, Washington, DC: Institute for International Economics, pp. 1–78, ISBN 0-88132-334-9, <[10]
59. ^ Weinstraub, S (2004). NAFTA's Impact on North America: The First Decade. CSIS Press: Washington, DC. ISBN-10: 089206451X.
60. ^ Lederman, Daniel; William F. Maloney & Luis Servén (2004). Lessons from NAFTA for Latin American and Caribbean Countries: A Summary of Research Findings. The World Bank. ISBN-10: 0821358138.
External links
- (Spanish) Mexican Council for Economic and Social Development
- (Spanish) Mexico Development Gateway
- (English) OECD's Mexico country Web site and OECD Economic Survey of Mexico
- (English) Gross Domestic Product Growth - Mexico
Caribbean Community (CARICOM)
){kind=small}
World Trade Organization (WTO)
gross domestic product, or GDP, is one of the ways for measuring the size of its economy. The GDP of a country is defined as the total market value of all final goods and services produced within a country in a given period of time (usually a calendar year).
..... Click the link for more information.
..... Click the link for more information.
The purchasing power parity (PPP) theory was developed by Gustav Cassel in 1920. It is the method of using the long-run equilibrium exchange rate of two currencies to equalize the currencies' purchasing power.
..... Click the link for more information.
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Anthem
Himno Nacional Mexicano
Capital
(and largest city) Mexico City
Official languages Spanish (
..... Click the link for more information.
Himno Nacional Mexicano
Capital
(and largest city) Mexico City
Official languages Spanish (
..... Click the link for more information.
Economic systems
Ideologies and Theories
Primitive communism
Capitalist economy
Corporate economy
Fascist economy
Laissez-faire
Mercantilism
Natural economy
Social market economy
Socialist economy
Communist economy
..... Click the link for more information.
Ideologies and Theories
Primitive communism
Capitalist economy
Corporate economy
Fascist economy
Laissez-faire
Mercantilism
Natural economy
Social market economy
Socialist economy
Communist economy
..... Click the link for more information.
Latin America (Portuguese and Spanish: América Latina; French: Amérique Latine) is the region of the Americas where Romance languages, those derived from Latin (particularly Spanish and Portuguese), are primarily spoken.
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In finance, the exchange rate (also known as the foreign-exchange rate, forex rate or FX rate) between two currencies specifies how much one currency is worth in terms of the other.
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The Organisation for Economic Co-operation and Development (OECD), (in French: Organisation de coopération et de développement économiques; OCDE) is an international organisation of thirty countries that accept the principles of representative democracy and a free
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The 1994 economic crisis in Mexico, widely known as the Mexican peso crisis, was triggered by the sudden devaluation of the Mexican peso in the early days of the presidency of Ernesto Zedillo.
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The South American Economic Crisis is the economic disturbances which have developed in 2002 in the South American countries of Argentina, Brazil and Uruguay. These crises have shaken confidence in the Washington consensus.
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Moody's Corporation
Public (NYSE: MCO )
Founded New York City (1909)
Headquarters New York City
Website www.moodys.com
Moody's Corporation (NYSE: MCO ) is the holding company for Moody's Investors Service
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Public (NYSE: MCO )
Founded New York City (1909)
Headquarters New York City
Website www.moodys.com
Moody's Corporation (NYSE: MCO ) is the holding company for Moody's Investors Service
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Fitch Ratings, Ltd. is an international credit rating agency dual-headquartered in New York City and London. It was one of the three Nationally Recognized Statistical Rating Organizations (NRSRO) designated by the U.S.
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free trade area is a designated group of countries that have agreed to eliminate tariffs, quotas and preferences on most (if not all) goods between them.
It can be considered the second stage of economic integration.
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It can be considered the second stage of economic integration.
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Central America (Spanish: Centroamérica or América Central) is a central geographic region of the Americas. It is variably defined either as the southern portion of North America, which connects with South America on the southeast, or a region of
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Secretariats
(and largest city)
Official languages English, French and Spanish
Membership Canada
Mexico
United States
Establishment
- Formation 1 January 1994
Website
[1]
The
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(and largest city)
Official languages English, French and Spanish
Membership Canada
Mexico
United States
Establishment
- Formation 1 January 1994
Website
[1]
The
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Independence
The Mexican War of Independence (1810-21) left a legacy of economic stagnation that persisted until the 1870s. The the silver-mining sector of the economy (Mexico's primary earner of foreign capital) was located in the areas of the country that saw the most intensive..... Click the link for more information.
José de la Cruz Porfirio DÃaz Mori (15 September 1830 – 2 July 1915) was a Mexican-American War volunteer, French Intervention hero, and President. He ruled Mexico from 1876 to 1880 and from 1884 to 1911.
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Rail transport is the transport of passengers and goods by means of wheeled vehicles specially designed to run along railways or railroads. Rail transport is part of the logistics chain, which facilitates the international trading and economic growth in most countries.
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gross domestic product, or GDP, is one of the ways for measuring the size of its economy. The GDP of a country is defined as the total market value of all final goods and services produced within a country in a given period of time (usually a calendar year).
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Motto
En unión y libertad (Spanish)
"In Union and Freedom"
Anthem
Himno Nacional Argentino
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En unión y libertad (Spanish)
"In Union and Freedom"
Anthem
Himno Nacional Argentino
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Motto
Libertad o muerte (Spanish)
"Freedom or death"
Anthem
Himno Nacional Uruguayo
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Libertad o muerte (Spanish)
"Freedom or death"
Anthem
Himno Nacional Uruguayo
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Motto
Ordem e Progresso (Portuguese)
"Order and Progress"
Anthem
Hino Nacional Brasileiro
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Ordem e Progresso (Portuguese)
"Order and Progress"
Anthem
Hino Nacional Brasileiro
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Motto
[2]
Anthem
Gloria al Bravo Pueblo (Spanish)
"Glory to the Brave People"
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[2]
Anthem
Gloria al Bravo Pueblo (Spanish)
"Glory to the Brave People"
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Latifundia are pieces of landed property covering tremendous areas. The latifundia [Latin lātifundium: lātus, "spacious" + fundus, "farm, estate"] of Roman history were great landed estates, specializing in agriculture destined for export:
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Hacienda is a Spanish word for an estate, usually, but not always, a vast ranch. Some haciendas were plantations, mines, or even factories. Many haciendas combined these productive activities.
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million (1,000,000), or one thousand thousand, is the natural number following 999,999 and preceding 1,000,001.
In scientific notation, it is written as 106[1]
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In scientific notation, it is written as 106[1]
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Mexican Revolution was a period of political, social and military conflict and turmoil that began with the call to arms made on November 20 1910 by Francisco I. Madero and lasted until 1917.
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For the town and municipality of Spain, see .
The ejido [ɛxˈido] (from latin exitum) system is a process whereby the government promotes the use of communal land shared by the people of the community...... Click the link for more information.
Luis EcheverrÃa Ãlvarez (born January 17, 1922) served as the President of Mexico from 1970 to 1976.
EcheverrÃa joined the faculty of the National Autonomous University of Mexico in 1947 and taught political theory.
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EcheverrÃa joined the faculty of the National Autonomous University of Mexico in 1947 and taught political theory.
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José López Portillo y Pacheco ("JOLOPO") (June 16 1920 – February 17 2004) was the President of Mexico from 1976 to 1982.
Born in Mexico City, López Portillo studied Law at the National Autonomous University of Mexico (UNAM) before beginning his political career with
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Born in Mexico City, López Portillo studied Law at the National Autonomous University of Mexico (UNAM) before beginning his political career with
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Mexican peso
peso mexicano (Spanish)
$1000 Mexican Coins in circulation
ISO 4217 Code MXN
User(s) Mexico
Inflation 3.
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peso mexicano (Spanish)
$1000 Mexican Coins in circulation
ISO 4217 Code MXN
User(s) Mexico
Inflation 3.
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