Latin America has seven big economies Brazil, Mexico, Argentina, Venezuela, Colombia, Chile and Peru. The largest economy can be shown as Brazil. Mexico is the second largest economy in Latin America and expanded at a strong pace for most of 2011 but started to show signs of slowly decelerating. Result to that seems to be multinational firms. The multinational firms set up their factories to Mexico to reduce the cost of production. Although the multinational firms seem to be helping the Mexico economy, they also harm the domestic firms. The question has to be asked that how does production of manufacturing goods & services by domestic or multinational affect a country’s economy?
First of all, we have to mention about the Mexico’s economy briefly. Mexico locates in the Central America and has GDP over one trillion. Some of the countries locate in Central America as well as Mexico, are Guatemala, Panama, El Salvador, Honduras, Nicaragua and Belize. These countries are very poor in GDP and very low income compared to Mexico. Mexico also has a higher income level refer to the GDP per capita. Mexico’s GDP growth over the last year is 4%. What is GDP and why is it so important for a country? GDP represents the output of all final goods& services produced in an economy during a year. It is important because it reflects the situation of economy by all final goods& services produced in an economy so that the governments can foresee the economic situation of a country. There is also another variable that can show economic evaluations which is GNI. According to World Bank, Mexico’s GNI is also over one billion however since their population is high, GNI per capita is less compared to the other Latin American Countries. GNI per capita i...
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...m competition by the Mexican government through tariffs are no longer protected. Because a very large percentage of Mexican manufacturers are small with fewer than 250 workers, some of them have not been able to withstand the pressures of competing in an international marketplace. However, the increase in manufacturing output over the past 5 years suggests that the surviving manufacturers are doing well.
Works Cited
• Retrieved data on 5 May, from www.worldbank.org
• Retrieved data on 5 May, from http://www.nationsencyclopedia.com/economies/Americas/Mexico-OVERVIEW-OF-ECONOMY.html
• Retrieved data on 6 May, from http://geo-mexico.com/?tag=trade
• Retrieved data on 9 May, from http://www.iie.com/publications/chapters_preview/332/06iie3349.pdf
• Retrieved data on 9 May, from http://www.nationsencyclopedia.com/economies/Americas/Mexico.html#ixzz2TF51a352
In this paper I will discuss the history and practices of the Maquiladora industry. I will discuss its background, its problems, the benefits it offers to United States companies, and the impact the NAFTA has and will have on the industry. In addition, I will make a suggestion on a possible strategy the Maquiladoras can adopt in order to address the challenges brought on by the NAFTA, to ensure it remains a strong force in the future.
A prime example of this is the relationship between Mexico and the United States. Mexico has a comparative advantage over a large majority of countries in the world in its abundance of cheap labor. Mexico also has fairly underdeveloped environmental protection and labor laws, which allows corporations more leeway in their operations. Additionally, Mexico provides incentives to foreign corporations including reduced tariffs, unrestricted leases and certain tax exemptions. As a result, corporations have less overhead costs and a greater potential for profits.
Ikea is a Swedish company that provides furnished products throughout the world. Ingvar Kamprad founded it in the year of 1943. Its furniture is self-assembled thus allowing the company to reduce its expenditures and offer customers low prices in return. When segmenting a market, IKEA usually focuses on age, income level, and lifestyle. It aims to attract young, underprivileged individuals who look to buy furniture for the first time. An example of this would be college students; they are often confused, doubtful, and looking for something cheap. IKEA currently operates in twenty-seven countries including Korea, China, Sweden, and Netherlands amongst many others (IKEA.com). Although it is
Located in the southeastern section of Mexico, right along the Pacific Ocean, lies the diverse Mexican state of Oaxaca. Due to the “sixteen ethno linguistic groups [that were able to] maintain their individual languages, customs and ancestral traditions” (Schmal), Oaxaca is by far one of them most ethically complex states in Mexico. In fact, Oaxaca is heavily dominated by the Zapotec and Mixtec people, which are the two largest groups in Oaxaca. However, globalization has recently impacted the greater city of Oaxaca and its inhabitants more than ever. Western goods, services, ideas, values and media have impacted areas all around the world and Oaxaca, Mexico has seen its effects first handed. Globalization has deeply impacted small communities within Oaxaca; cities have been deserted, families have been relocated, and economical distress has been experienced. If globalization did not have a direct impact on communities within Oaxaca, local communities would have been able to thrive, local businesses would flourish, and economic hardships would have been decreased. Without globalization, the citizens of Oaxaca, Mexico could have stayed in their homelands and gathered wealth to invest back in their community, schools, and other facilities.
Very high population rates do not correspond with working labor force, in that (Polaski 2004) the Mexican labor force grew from 32.3 million immediately before NAFTA to 40.2 million in 2002, meaning that Mexico needed almost a million jobs a year simply to absorb the growth in labor supply. Many theorists suggest that a free trade zone will increase employment, by the increase demand for labor therefore creating a vast rapid workforce. However, NAFTA has greatly impacted manufacturing employment, by producing a low small net gain in hobs in Mexico, in that jobs created in export manufacturing have barely kept pace with jobs lost in agriculture due to imports (Polaski 2004). There has been a visible weakening in domestic manufacturing employment, related in part to increase import competition. In addition, the cause of a decline in domestic manufacturing employment is caused due to the relocation of the maquiladora factory workforce, which the United States has relocated the maquiladora assembly plants to China and Indonesia, because of low wage, cheaper labor workforce, skilled workforce, and less environmental protection laws. The maquiladora assembly plants in the late 20th century have disappeared
...ca (Mexico Background Information, 2014). Mexicо thrоugh austerity tо cоntrоl inflatiоn, adjust the structure оf impоrt and expоrt cоmmоdities, and stimulate private investment, expanding оpening tо the оutside wоrld and a series оf pоlicies and measures tо imprоve the ecоnоmic efficiency and the implementatiоn оf the variоus ecоnоmic and sоcial develоpment plans, sо Mexicо's ecоnоmy gradually stabilized, it began tо cоme оut оf recessiоn and the plight оf the crisis, trend tо recоvery and grоwth (Central Intellegence Agency , 2014). Adоpted a pоlicy оf оpenness tо trade, they encоurage dоmestic prоduct expоrt, relax restrictiоns оn impоrts, make fоreign trade grоwth significantly (Central Intellegence Agency , 2014). Hоwever, cultures alsо have certain influence tо the ecоnоmy (BBC, 2012). Dоing business in Mexicо is a gооd chоice (Doing Business in Mexico , 2011).
...s. Products in Mexico have to be much lower in cost for the general public to purchase compared to the US. This is where market share and sales volume come in to play.
The economy of Mexico is vastly diverse, much like that of the United States. Mexico has many different sources of economic revenue including tourism, oil, agriculture, and the automobile industry. The USDS website reports the percentage breakdown of Mexico’s gross domestic product (GDP), with the largest portion (61%) coming from the service sector. The site defines the service sector as commerce and tourism, financial services, transportation and communications. In 2010, Mexico attracted 21.3 million tourists, making it the 10th most visited destination in the world. The remaining portion of GDP is broken down between industry and agriculture. Industry accounts for (31%) of GDP and is defined as a combination of food and beverage, tobacco, chemicals, iron and steel, and others. The remaining 5% of GDP comes from agriculture, with the top three crops being corn, wheat, and soybeans. Mexico also has a variety of natural resources including petroleum, silver, copper, and gold, which is included under...
Mexican Lives is a rare piece of literature that accounts for the human struggle of an underdeveloped nation, which is kept impoverished in order to create wealth for that of another nation, the United States. The reader is shown that the act of globalization and inclusion in the world’s economies, more directly the United States, is not always beneficial to all parties involved. The data and interviews, which Hellman has put forth for her readers, contain some aspect of negativity that has impacted their lives by their nation’s choice to intertwine their economy with that of the United States. Therefore it can only be concluded that the entering into world markets, that of Mexico into the United States, does not always bring on positive outcomes. Thus, one sees that Mexico has become this wasteland of economic excrement; as a result it has become inherently reliant on the United States.
Culture is defined in many ways. It is the belief, customs, arts, and way of life for a particular society, group, place, or time (Culture, n.d.). Along with defining culture there are characteristics that come along with each and every culture you come across. There are five basic characteristics that all cultures share and differentiate from and they are learning, shared, symbols, integrated, and dynamic. “What sets worlds in motion is the interplay of differences, their attractions and repulsions. Life is plurality, death is uniformity. By suppressing differences and peculiarities, by eliminating different civilization and cultures, progress weakens life and favors death. The ideal of a single civilization for everyone, implicit in
Mexico is a country that is led by a federation government which is democratic, representative, and republican based on presidential system since Constitution of 1917. The constitution has government in three levels: federal Union, state, and municipal governments. Officials at three levels are elected by voters. Mexico is fifth largest country in Americas and most populous country in world that speaks Spanish. Mexico is currently in a transformation to help the country grow both economically and politically with the current president taking extreme steps to move ahead.
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...ing economic developments. The Chiapas, which has a mostly Amerindian population, consists mainly of peasant farmers surviving by subsistence farming. Fifty-three percent of the people in Mexico live in extreme poverty (222). Brazil has also seen astonishing increases in the number of people living in poverty. There has been a fifty percent increase in the number of people living in poverty (256). Both Mexico and Brazil will have to work towards a more balanced distribution of wealth in the years to come.
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