Translated by Stuart Taylor
The country’s current economic conditions do very little to put us at ease, although the Government justifies itself by saying that the causes are all coming from abroad. Hence, we should be happy about the devaluation of the peso (18.8 pesos to the dollar), despite the fact that Mexicans have lost 30% of their savings value, as now exportation has increased. The increase in agriculture and livestock exports is often mentioned, but in reality the trade deficit for the food and agriculture balance remains. Moreover, although it might appear to be going down, we are still importing more agricultural products than we are selling. To top it all, we now have to pay for these importations with very expensive dollars.
Our problems do not reside abroad, but rather they are the result of totally erroneous economic policies, among them having joined globalization using the neoliberal model with the signing of the North American Free Trade Agreement (NAFTA). This turned us into obvious exporters, but of cheap labor, much of which comes from undocumented workers that benefited U.S. employers and the competitiveness of their products, especially those that turned that country into a huge global competitor in the food and agriculture sector.
The clear consequence of this was the total devastation of the Mexican countryside and, as a result, the exodus of farmers, followed by other Mexican workers, to benefit from the economy of our neighboring country and its production sectors. This explains why Mexico receives such a high volume of remittances – money which is part of the salary of those migrant workers, as Mexican economist Alejandro Canales so rightly said. According to BBVA [Bancomer], they attained 24.77 billion USD in 2015, representing a 4.8% increase. Data from the Secretariat of Tourism (La Jornada, February 3) suggests that this figure is well above that year’s crude oil exports, which totaled 18.52 billion USD and the 15.54 billion USD gained from foreign tourism.
However, the number of people in poverty has increased, going from 53.3 million people in 2012 to 55.3 million in 2014, according to data from the National Council for the Evaluation of Social Development Policy (CONEVAL), and extreme inequality has also increased while the rich are getting fewer but even richer. The reality, as explained by Gerardo Esquivel (Oxfam, 2015), is that the economy has stagnated, growth is entirely insufficient, average salaries are not rising, and poverty is persisting. This is what the country is facing after 20 years of NAFTA.
Mexico has not only become the country with the most assembly plants and the world's biggest workforce exporter but also, sadly, strategies were abandoned that would have allowed it to offset negative factors. Abandoned strategies include those relating to research, science, education, technology and innovation, as with those advancements the country could have gradually adopted the new economic trends and consequently sparked development. Mexico is the country that invests the least in those sectors, which prevents it from having more researchers in relation to the number of inhabitants.
The United Nations Educational, Scientific and Cultural Organization (UNESCO) indicates that government investment in the science and technology sector went from 0.2% of GDP in 2005 to 0.38% in 2013. Regarding general data in the world, UNESCO representative in Mexico, Nuria Sanz, states that today China is the second largest investor in science, technology and research, with 20% of global spending, surpassed only by the United States, whose budget in this area represents 28% of global investment, which is well above the European Union and Japan (19% and 9% respectively).
Mexico is currently finding itself once again at a crossroads. It is about to sign the so-called Trans-Pacific Partnership (TPP) Agreement, which some authors have called NAFTA plus. In fact, the Secretary of Economy, Ildefonso Guajardo Villarreal, travelled to New Zealand to effectuate the TPP. As such, it would appear that “the trade negotiation process that began on December 2, 2012, has come to an end” (La Jornada, February 3).
From our point of view, economic subordination before the United States is going to worsen. The World Bank itself states that of the 12 member countries Mexico will be the country that least benefits from the TPP, as Mexican exports will increase only by 4.7% between 2014 and 2030, compared with Vietnam (30.1%), Japan (23.25%) and Peru (10.3%) (El Economista).
Enrique Peña Nieto will send it to the Senate before April 30, but little can be expected of the Mexican Congress, as the majority of the legislators simply raise their hands, obeying superior orders. This is how the country will irreversibly make the transition toward the antithesis of development. Spanish original
*Ana María Aragonés Castañar is a full-time professor in the Economic Research Institute at National Autonomous University of Mexico (UNAM) in the area of the economics of work and technology. She also offers postgraduate classes in "Mexico-U.S. Studies." A member of the National System of Researchers, she is a National Investigator. Dr. Aragonés earned her baccalaureate degree in History (UNAM, Acatlán); the master's in Work Administration (Autonomous Metropolitan University-Xochimilco); and the Ph.D. in Law (University of Montpellier, France). Her research areas are: migratory flows; changes in labor markets and effects on migration flows in the context of globalization; demographic issues in destination countries. Email: amaragones@gmail.com