1 / 12

Mexican Economic Development : 1940-2006

Mexican Economic Development : 1940-2006. “The Mexican Miracle”. 1940-1980 Remarkable growth Annual Avg. GDP Growth=6.5% Reasons for Success Government stability Oil Revenue Emphasis on Industrialization Subsidies for domestic industries Import Substitution High tariffs

starbuck
Download Presentation

Mexican Economic Development : 1940-2006

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Mexican Economic Development: 1940-2006

  2. “The Mexican Miracle” • 1940-1980 • Remarkable growth • Annual Avg. GDP Growth=6.5% • Reasons for Success • Government stability • Oil Revenue • Emphasis on Industrialization • Subsidies for domestic industries • Import Substitution • High tariffs • Nationalization of industry. • Oil, railroad, electricity, & thousands of companies.

  3. Parastatal • Company or agency owned (or partially owned) by the government. • By 1980, the government controlled over 1,000 firms. • PEMEX (Mexican Petroleum) • Net worth of $415 billion • Employs approx 140,000

  4. Mexican Debt Crisis, 1980s-90s • WHAT WERE THE CAUSES? • WHY DID THE U.S. WANT TO HELP?

  5. Mexican Debt Crisis, 1980s-90s CAUSES • Heavy borrowing to industrialize caused Foreign Debt • Gambled on high oil prices • 1980s: Prices DROPPED • Import Substitution=Industrial inefficiency • Uncompetitive in global market • Led to a trade deficit • Runaway Inflation: 1987=159% Total Debt 1970=6 billion 1982=80 billion 1976=26 billion 1987=107 billion (70% of GNP)

  6. Bailout of 1995 • International investors withdrew $5 billion from Mexican market. • Lacked ability to pay debt. • Borrowed $50 billion from IMF and the U.S.

  7. PRI Becomes Market-Oriented New policies of Late ‘80s through ‘90s. • Debt Reduction • Austerity Measures • Cut deficit in half in 3 years. • Raised taxes • Reduced social services • Privatization • Sold parastatals • Only about 100 left today.

  8. Opening Up the Economy • Protectionism to neoliberalism • Import substitution to structural adjustment • Allow FDI. • 1986: Joined General Agreement on Tariffs and Trade (GATT) • Precursor to WTO. • Diversified exports (not just oil) • 1992: Signed North American Free Trade Agreement (NAFTA)

  9. North American Free Trade Agreement (NAFTA) • United States, Mexico and Canada • Eliminate tariff barriers • Greatly reduce other barriers (i.e., licensing fees and quotas for foreign companies)

  10. Maquiladoras • Foreign-owned factories in Mexico. • Goods are imported to Mexico. • Made in Mexico. • Then exported. • Largely located in North

  11. Zapatistas • State of Chiapas • Indigenous Mayan farmers Concerns • Abject poverty • Few elite controlled arable land (seized ejidos) • NAFTA • Ended ejidos • PRI “Democracy” • No self-rule • Elite land owners and PRI

  12. Zapatistas • Zapatista Army of National Liberation (EZLN) • Subcomandante Marcos • January 1, 1994 (NAFTA enacted) • EZLN seized 6 towns • Mexican army clashed with EZLN • Cease fire after 12 days • Approx. 200-400 died. • San Andres Accords, 1996 • Protect indigenous languages • Greater local autonomy • NEVER IMPLEMENTED • Few EZLN goals realized

More Related