Overview

Mexico


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Mexico is no longer a one-party state—elections are now fiercely contested

Some have suggested that Mexico's most important geographical feature is the 2,000-mile border it shares with the USA. But Mexico has a striking diversity all of its own—from the snow-capped mountains of the Sierra Madre, to the deserts of Sonora, to the tropical rainforests of Yucatán. Most of the population is to be found, however, in the central region in the high plateau and the surrounding mountains.

Today's Mexicans are largely mestizo, a mixture of Indian and European ancestry. But about one-third are of purer Indian origin, in more than 60 ethnic groups concentrated in the south. They also tend to be the poorest. Overall, 18% of the population live below the national poverty line.

Education levels have improved in the past ten years and only 10% of adults are now illiterate. Even so, one-third of adults have not completed primary education. Standards of health are also better, with a substantial reduction in infant mortality, though rates vary markedly between states.

Population growth and rural–urban migration have contributed to an explosive growth of cities, particularly of Mexico City, which with a population of 18 million is the second largest city in the world. It also has some of the most polluted air and is suffering from rising levels of crime.

Apart from migrating to cities, Mexicans have also been moving to the USA. By 2004, 10.3 million first-generation Mexicans were living in the USA. At least half are there illegally. They send $26 billion annually in remittances. Around 400,000 people emigrate annually.

A major stimulus for emigration has been the poor state of Mexican agriculture. Agriculture only contributes 4% of GDP but is responsible for 16% of employment. Only about one-fifth of the country is suitable for arable farming, and even then the soil is often thin and levels of technology are low. Over half of this land consists of ‘ejidos’, small collective farms generally growing maize and beans. From the mid-1980s, the government liberalized agriculture—reducing subsidies and allowing the ejidos to be sold and consolidated. But this brought few benefits to small farmers who found it difficult to get bank loans. Following the 1994 North American Free-Trade Agreement (NAFTA), Mexican maize farmers also find it very hard to compete with imports from the USA. Corn prices have fallen and one-third of corn is imported. The brightest agricultural development has been in the north, where irrigation has permitted a flourishing export trade in fruit and vegetables to the USA.

Aside from the land, one of Mexico's greatest natural assets is oil. Mexico is the world's fifth largest producer and the third largest source of crude oil to the USA. At present rates of extraction, reserves should last until around 2016. Another valuable asset is silver: Mexico has the world's largest silver production.

3,300 assembly plants on the US border

Most industrial employment is in manufacturing which since 1994 has been transformed by NAFTA. One of the most dynamic parts of the economy, which preceded NAFTA, has been the ‘maquiladora’, the 3,300 duty-free assembly plants strung along the border with the USA which employ one million people—10% of formal sector jobs.

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