Mexico, the second largest economy in Latin America, finds itself confronted with several internal and external issues. In the prior year, the country experienced a decline of the economic growth. Major reasons are on the one hand, the uncertain future after the presidential election of Donald Trump, as well as the decreasing industrial production of the main trade partner, the USA. In consequence, the oil price fell, and the Mexican currency lost 20% of their value. On the other hand, the domestic market is strongly influenced by misallocation of educational funds, failed reforms, which increased the income inequality and organized crime. This essay will reflect briefly on these topics, to give a short overview of the country`s economic background andthe current situation. Furthermore, certain information about society, history and the political system will be provided to allow the reader a full insight into these connected topics.
Table of Contents
1. Introduction
2. Overview
3. History
4. Political System
5. Society
6. Economic growth
7. Obstacles for the economic growth
8. Conclusion
Objectives & Topics
This paper examines the contemporary economic situation of Mexico, analyzing the internal and external challenges the country faces, such as political instability, income inequality, organized crime, and the implications of its trade relationship with the United States.
- Economic performance and growth history
- The political framework and democratic challenges
- Social structure, education, and poverty
- Impact of international trade agreements like NAFTA
- Obstacles to economic progress including organized crime
Excerpt from the Book
6. Economic growth
The Mexican wars of independence (1810-21) led to an economic stagnation that persisted until the 1870s. The reason for this was that political instability and foreign invasion were a barricade for foreign investment, risk-taking, and innovation. Most available capital was taken by Spanish owners following independence. Instead of investing in productive enterprises and thereby stimulating economic growth, many wealthy Mexicans converted their assets into tangible, secure, and often unproductive property. Mexico had to wait until the dictatorship of Porfiriato Diaz (1876-1910) to start a rapid and sustained growth and to create the foundations for a modern economy. He established the rule of law, political stability, and social peace, which brought the increased capital investment that would finance national development and modernization. Crime was displaced, communications and transportation facilities were modernized, and local customs duties that had hindered domestic trade were abolished. The Mexican Revolution (1910-20) severely disrupted the Mexican economy, erasing many of the gains achieved during the Porfiriato dictatorship. The labor force declined sharply because the population was declined by 360,000 people. Also thousands of cattle were lost to the plundering of rival militias. Cotton, coffee, and sugarcane went unharvested as workers left the fields to join or flee the fighting. The result was a drop in agricultural output. The banking system was shattered, public credit disappeared, and the currency was destroyed.
Summary of Chapters
1. Introduction: Presents an overview of Mexico's current internal and external economic issues, highlighting the impact of US political changes and domestic structural problems.
2. Overview: Provides a geographical and socio-political profile of Mexico, including its climate, population density, and major urban centers.
3. History: Traces the historical evolution of Mexico from pre-Columbian civilizations and the Spanish conquest to the struggle for independence and the Mexican Revolution.
4. Political System: Explains the structure of the Mexican federal republic, the roles of the executive, legislative, and judicial branches, and the evolution of its multi-party system.
5. Society: Discusses demographic trends, ethnic diversity, the influence of religion, and the persistent challenges of rural poverty and educational deficiencies.
6. Economic growth: Details the economic history of Mexico, focusing on boom-and-bust cycles, the shift toward industrialization, and the role of trade agreements.
7. Obstacles for the economic growth: Analyzes the primary barriers to development, specifically organized crime, income inequality, and political uncertainty.
8. Conclusion: Summarizes the country's potential for growth while emphasizing the need for domestic reform and trade diversification to mitigate external dependencies.
Keywords
Mexico, Economy, NAFTA, History, Political System, Society, Organized Crime, Education, Inequality, Trade, GDP, Development, Reform, Latin America, Industrialization
Frequently Asked Questions
What is the primary focus of this paper?
This paper provides an analytical overview of Mexico's economic state, exploring how historical, social, and political factors shape its current performance and future outlook.
What are the central thematic fields addressed?
The core themes include the historical background, the structure of the political and judicial systems, the demographic and educational landscape, and the challenges of achieving sustained economic growth.
What is the primary research goal?
The essay aims to provide a comprehensive insight into the connected nature of Mexico's economic, political, and social issues to explain why the country's economic path remains fragile.
Which methodology is used to analyze the topic?
The authors employ a descriptive and analytical approach, synthesizing existing reports, historical accounts, and economic data from international organizations to present the country's situation.
What topics are covered in the main section?
The main sections cover the overview, historical development, the functionality of the political system, social issues, an analysis of economic growth, and the specific obstacles hindering progress.
Which keywords define this work?
The work is defined by terms such as Mexico, NAFTA, economic growth, inequality, organized crime, political system, and institutional reform.
How has the Mexican political system evolved?
The system has shifted from the rule of a single party toward a more democratic, multi-party system, though it still faces challenges regarding corruption and transparency.
What is the impact of organized crime on the economy?
Organized crime acts as a significant deterrent to investment and development, contributing to violence, kidnapping, and the erosion of governmental authority.
How do international trade agreements affect Mexico?
Agreements like NAFTA have fostered economic growth and industrialization but have also created dependencies on the US market and contributed to a two-speed economy between the north and south.
- Quote paper
- Thomas Werner (Author), Patrick Stalmach (Author), 2017, Mexico. Political System, Society, History, Economy and Obstacles to Economic Growth, Munich, GRIN Verlag, https://www.grin.com/document/428162
