78.8 F
Mérida
Saturday, October 16, 2021
###

Mixed feelings in Mexico as NAFTA talks continue

Latest headlines

Cozumel’s cruise industry bounces back in a big way

Quintana Roo has come to depend on a steady stream of cruise-goers, to maintain jobs at businesses including restaurants, excursion operators,...

Massimo Bottura’s community dinner is fighting hunger in Refettorio Mérida

Refettorio is a cultural project designed to offer dining experiences through the transformation of surplus ingredients into nutritious and beautiful dishes.

In Europe, Mexican Indigenous organizations denounce the Mayan Train

Indigenous groups from across Mexico, including Yucatán and Quintana Roo, sailed to Europe in what they describe as an invasion of conscience.

A private paradise at your Yucatán country estate

A private country estate is all yours in Yucatán. Contact Eric Partney at Mexico International. Ideal for those...
Yucatán Magazine
Sign up to get our top headlines delivered to your inbox twice a week.

The flags of North America The Mexican, US and the Canadian flags sit in the lobby where the third round of NAFTA renegotiations take place in Ottawa last September. Photo: Getty


While Mexico City tries to convince Washington that NAFTA has been good for both countries, critics south of the border think it’s time to take a hard look at the trade agreement’s shortcomings.

“NAFTA has generated employment, has provided a lot of goods, trade and investment, that’s fine,” said Mexican economist Gerardo Esquivel in the Business Journal newspaper. “But in terms of the final purpose of NAFTA, I think it has been very short to what was supposed to be the goal of NAFTA, which was to promote convergence in the North American region.”

And NAFTA hasn’t reduced the wage gap between Mexico and the United States, which was one of its main goals when it passed in 1994, Esquivel said.

In fact, that gap has gotten worse. U.S. wages went from 2.85 to 3.19 times larger than Mexico’s. More than half the country’s 127 million residents still live in poverty.

In NAFTA’s favor, foreign investment grew from $4.4 billion in 1993 to $32.9 billion in 2015, according to the World Bank. U.S.-Mexican trade increased more than sixfold, from $81 billion in 1993 to $525 billion in 2016, according to the U.S. Census data.

But relatively few regions and business sectors have benefited from that growth.

“All the benefits of NAFTA have been concentrated along the border, certain central states, and somehow Mexico City,” said Esquivel.

The manufacturing work that companies do in Mexico is very simple and is not adding real value to the products that are exported to the U.S, continued Esquivel.

“Most of what we do is just ‘maquila’ work, and that means getting the inputs, doing a minimal processing work in some cases, and just sending them back to the U.S. This can be imported from the U.S. or from other markets,” he said.

Poverty levels have barely budged since NAFTA. In 1992, 53.1 percent of Mexicans lived in poverty, while in 2014 the rate was 53.2 percent, according to the National Council for Evaluation of Social Development Policy.

“Indigenous communities have not benefited at all (from NAFTA) and perhaps have suffered,” said Mark Aspinwall, director of the Division of International Studies at the Center for Economic Research and Teaching in Mexico City. “They’ve definitely suffered in certain areas where infrastructure projects have been put in.”

Aspinwall thinks the Mexican government needs to “do better with its education, it needs better social welfare and social services, it needs better infrastructure, it needs better public services, less corruption.”

According to preliminary estimates by Mexico City economist Jose Luis de la Cruz, eliminating Mexico’s trade surplus with U.S., which has been one of U.S. President Trump’s main goals, would result in a catastrophic drop of 3 to 4 percentage points of gross domestic product growth in Mexico.

For Esquivel, Mexico has only one option, regardless of what happens with NAFTA.

“In any case, I think what we need to do is to do what we haven’t done for the past few decades, which is to look at our internal problems, to invest more in what we haven’t invested in the past few decades, like education and infrastructure,” he said.

Source: Business Journals

- Advertisement -
- Advertisement -

More articles

Yucatán’s bars and cantinas forge a new lobbying association

The group, which is now known as Asociación de Cantineros, is already made up of over 120 members but is yet to elect its first president. 

Progreso to host the Americas’ largest shipyard

Yucatán's Gov. Mauricio Vila Dosal in Trieste Italy with the executive board of the Italian company Fincantieri. Photo: Courtesy

The Dresden Codex, the great Maya book of the stars

The Dresden Codex is a Mayan book believed to be the oldest surviving book written in the Americas, dating to the 11th or 12th century.

How photographer Mike Diaz captures Yucatán’s unique environment

As Mike grew up, he dove back into nature, researching the environment, wildlife, and space. He understood the process he had to follow in order to achieve the photos he dreamed of.

Live music is back at Yucatán’s restaurants and bars

e measure was put in place over a year and a half ago along with a series of other restrictions to help against the spread of COVID-19.

Monument to the Montejo ‘covered in blood’ once again

A group of protesters staged a demonstration in front of the monument to the Montejo, vandalizing it and chanting anti-colonialistic slogans.

Camino del Mayab connects visitors with Yucatán’s remote communities

Photo: Camino del Mayab The Camino del Mayab, a network of trails that begins in Dzoyaxché, spreads out...

Parque De La Alemán — The bustling heart of one of Mérida’s original neighborhoods

The park, which measures about a full city block, features a roller skating rink, a children's playground, a large esplanade with a musical fountain, green areas, and a stage where artistic and cultural events are frequently held.

Yucatán cancels Xmatkuil fair and Hanal Pixán altars at Plaza Grande

The news comes as a disappointment for many who thought that a return to yellow on Mexico’s epidemiological traffic light system would mean more of a return to normal for public events. 

New sterilization campaign in Progreso cracks down on stray animals

The number of stray dogs and cats on the streets and beaches of Progreso has become a public health hazard, admits Mayor Julián Zacarías Curi.