Latin History
Mexico Economy
Mexico is located in North America and known as United Mexican States. It consists of thirty-one states and a federal district with the capital of Mexico City. It is most populous city in the Earth. The GDP is $1.149 trillion and per capital income is $11,249. the income per capita is $7.310. It is 12th largest economy in the world as measured in Gross Domestic product. The GDP real growth rate is 4.8%. The average annual GDP growth during 1972 to 1981 was 5.5% whereas during 1981-1986 it was only 1.5%. The GDP’s main share is from services 69.4% and the industry captured 26.7%. From Agriculture it is only 3.9%. The public debt is 23.3% of GDP. Mexico is highly dependent on exports to the United States. The quarter share of the country’s GDP is based on the exports to the United States. Hence the Mexican economy is strongly linked with the U.S. business.
The 1994-year is Mexico’s bad year. Of course it starts with acceptance of NAFTA in the year beginning with United States and Canada and ends with dark Christmas with peso devaluation. During the year there are many political problems like Chiapas rebellion, assignations of political leaders. There was such situation the Mexico attacked with the crisis during 1982 and it got recovered by 7 years whereas during 1994 peso devaluation, it takes for 7 months only to get recovery. During December 19, 1994, the exchange rate is 3.50 pesos per dollar. The consumer demand for goods collapsed. The Mexican interest rate on loans dramatically increased creating a shock in the banking system. Some businesses closed due to increase of market share. The exports increased with high exchange rate
Trade Relationship between Mexico and United States
90% of Mexican trade has been put under free trade agreements with over 40 countries. The North American Free Trade Agreement is significant in this regard. 9% of Mexican exports go to the United States and Canada. And imports recognized 65% from these two countries. The exports to Untied States are 88.4% and imports from United States are 68.4%. Mexico is dependent on trade with United States. The U.S. exports to Mexico include electronic equipment, motor vehicle parts and chemicals and in case of Mexican exports to the United States are Petroleum, cars and electronic equipment.
Mexico depends more than on U.S. economy whether it may be good or bad. The NAFTA relation between U.S and Mexico completed more than 10 years. Of course, after the peso devaluation, the Mexico economy become stable, perhaps the United States plays major role. Initially, there was a free trade agreement between Canada and United States called Free Trade Agreement during 1988. Thereafter it was included Mexico and fresh agreement is established in the name of NAFTA. It is trilateral agreement.
It is an agreement among the United States, Canada and Mexico. The agreement indicates elimination of tariffs of the produced traded in the respective nations i.e. United States, Canada and Mexico. It is planned to phase out tariffs over a period 15 years. Besides the restrictions were said to be removed from many categories, which includes motor vehicles, computers, textiles and agriculture.
Mexico Political
The type of government is Federal republic. Representing political parties are Institutional Revolutionary Party, National Action Party, Party of the Democratic Revolution, Green Ecological Party, Labor party and several small parties. The politics of Mexico are dominated by the three political parties in Mexico i.e. National Action Party (PAN), Party of the Democratic Revolution (PRD) and the Institutional Revolutionary Party (PRI). The recent federal presidential elections were held on July 2, 2006.
President Zedillo and president Fox continued with trade liberalization and several FTAs were signed with Latin American and European countries. Thus Mexico became one of the most open countries in the world of trade. Most Important reform during President Fox period is implementation of Freedom of Information laws. With this effect Mexico City and 26 states supposed to fight against corruption. Hence Mexico becomes international model by usage of FOIA laws and enforcement mechanisms.
References
- https://www.cia.gov/library/publications/the-world-factbook/geos/mx.html
- http://countrystudies.us/mexico/65.htm
- http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/0,,pagePK:180619~theSitePK:136917,00.html
- http://www.state.gov/r/pa/ei/bgn/35749.htm
