Title:         

Background Note: Mexico

PA Source: Office of Public Communication, Bureau of Public Affairs Description: Historical, Political and Economic Overviews of the Countries of the World Date: Jan, 15 19931/15/93 Category: Country Data Region: North America, Country: Mexico, Subject: Travel, North America Free Trade, History, International Organizations, Trade/Economics, Military Affairs, Cultural Exchange, State Department [TEXT]

Official Name:

United Mexican States

PROFILE

Geography
Area:
2 million sq. km. (764,000 sq. mi.); about three times the size of Texas. Cities: Capital--Mexico City (est. 20 million). Other cities--Guadalajara, Monterrey, Puebla de Zaragoza, Leon.
Terrain:
Coastal lowlands, central high plateaus, and mountains up to 5,400 m. (18,000 ft.).
Climate:
Tropical to desert.
People
Nationality:
Noun and adjective--Mexican(s).
Population (1992):
89 million.
Annual growth rate:
2%.
Ethnic groups:
Indian-Spanish (mestizo) 60%, American Indian 30%, Caucasian 9%, other 1%.
Religions:
Roman Catholic 90%, Protestant 5%, other 5%.
Language:
Spanish. Education: Years compulsory--8. Literacy: 90%.
Health:
Infant mortality rate--30/1,000. Life expectancy--male 68 yrs., female 76 yrs. Labor force (30 million): Services-30%. Agriculture, forestry, hunting, fishing--24%. Manufacturing--19%. Commerce--13%. Construction--7%. Transportation and communication--4%. Mining and quarrying--0.4%.
Government
Type:
Federal Republic.
Independence:
First proclaimed September 16, 1810; republic established 1822.
Constitution:
February 5, 1917.
Branches:
Executive--president (chief of state and head of government). Legislative--bicameral. Judicial--Supreme Court, local and federal systems.
Political parties:
Institutional Revolutionary Party (PRI), National Action Party (PAN), Party of the Democratic Revolution (PRD), Popular Socialist Party (PPS), Authentic Party of the Mexican Revolution (PARM), Party of the Cardenist Front of National Reconstruction (PFCRN).
Suffrage:
Universal at 18.
Administrative subdivisions:
31 states and a federal district.
Flag:
Green, white, and red vertical bands. Centered is an eagle holding a snake in its beak and perching on a cactus.
Economy
GDP (1991):
$282 billion.
Per capita GDP:
$3,200.
Annual real GDP growth:
3.6%
Avg. inflation rate:
19%.
Natural resources:
Petroleum, silver, copper, gold, lead, zinc, natural gas, timber.
Agriculture:
Products--corn, beans, oilseeds, feed grains, fruit, cotton, coffee, sugarcane, winter vegetables.
Industry:
Types--manufacturing, services, commerce, transportation and communications, petroleum and mining.
Trade (1991):
Exports--$27 billion: manufacturing 59%, petroleum and derivatives 30%, agriculture 9%, other 5%. Imports-- $38 billion: intermediate goods 63%, capital goods 22%, consumer goods 15%. Major trading partners--US, EC, Japan. US imports--$30 billion.
Official exchange rate (January 1993):
3,100 pesos, equivalent to 3.1 new pesos (introduced January 1993)=$1.

PEOPLE

Mexico is the most populous Spanish-speaking country in the world; it is the second most populous country in Latin America , after Portuguese-speaking Brazil. About 70% of the people live in urban areas. Many Mexicans emigrate from rural areas that lack job opportunities--such as the underdeveloped southern states and the crowded central plateau--to the industrialized urban centers and the developing areas along the US-Mexico border. According to 1991 census estimates, the population of greater Mexico City is roughly 20 million, which would make it the largest urban concentration in the world. The border region and Guadalajara, Monterrey, and other cities have undergone a sharp rise in population. Education in Mexico is being decentralized and enhanced in rural areas. The increase in school enrollments during the past 2 decades has been dramatic. Education is mandatory from ages 6 through 14 or until primary education is completed. Primary enrollment from 1970 through 1989 increased from less than 10 million to nearly 15 million. In 1990, 80% of the population between the ages of 6 and 14 were in school. (Latin America as a whole averages 85% enrollment.) Enrollments at the secondary school level have also shot up from 1.4 million in 1972 to as many as 5 million in 1990. Between 1959 and 1990, enrollments in institutions of higher learning skyrocketed from 62,000 to 1.5 million. Central to cultural expression are Mexico's history and quest for national identity. Contemporary artists, architects, writers, musicians, and dancers continue to draw inspirations from a rich history of Indian civilization, colonial influence, revolution, and the development of the modern Mexican state. Artists and intellectuals alike emphasize the problems of social relations in a context of national and revolutionary traditions.

HISTORY

Highly advanced cultures, including those of the Olmecs, Mayas, Toltecs, and Aztecs, existed in Mexico long before the Spanish conquest. Hernando Cortes conquered Mexico in 1519-21 and founded a Spanish colony that lasted nearly 300 years. Independence from Spain was proclaimed by Father Miguel Hidalgo on September 16, 1810, and the republic was established on December 6, 1822. Prominent in the War for Independence were Father Jose Maria Morelos, General Augustin de Iturbide, who defeated the Spaniards and ruled as emperor for a short period, and General Antonio Lopez de Santa Ana, who controlled Mexican politics from 1833 to 1855. Santa Ana was Mexico's leader during the conflict with Texas, which declared itself independent from Mexico in 1836, and during Mexico's war with the United States (1846-48). The presidential terms of the venerated Benito Juarez (1858-71) were interrupted by the Hapsburg monarchy's rule of Mexico. Archduke Maximilian of Austria, whom Napoleon III of France established as Emperor of Mexico, was deposed by Juarez and executed in 1867. General Porfirio Diaz was President during most of the period between 1877 and 1910. Mexico's severe social and economic problems erupted in the 1910- 20 revolution. Prominent leaders in this--some were rivals for power--were Francisco I. Madero, Venustiano Carranza, Pancho Villa, Alvaro Obregon, and Emiliano Zapata. The Institutional Revolutionary Party (PRI), formed in 1928 under a different name, continues to be the most important political force in the nation.

GOVERNMENT

The Constitution of 1917 provides for a federal republic with powers separated into independent executive, legislative, and judicial branches. The executive is the dominant branch, with power vested in the president, who promulgates and executes the laws of the Congress. The president also legislates by executive decree in certain economic and financial fields, using powers delegated from the congress. The president is elected by universal adult suffrage for a 6-year term and may not hold office a second time. There is no vice president; in the event of the removal or death of the president, a provisional president is elected by the Congress. The next presidential election will be held in August 1994. The Congress is empowered to legislate on all matters pertaining to the national government. Congress is composed of a Senate and a Chamber of Deputies. Consecutive reelection to the Congress is prohibited; 64 senators, 2 from each state and the Federal District (i.e., Mexico City), are elected to 6-year terms. Deputies serve 3- year terms. Under constitutional and legislative reforms adopted in 1986, the Chamber of Deputies was enlarged in 1988 from 400 to 500 members. In the expanded lower chamber, 300 deputies are directly elected to represent single-member districts, and 200 are selected on an at-large basis by a modified form of proportional representation. The 200 at-large seats were created to give the opposition parties more of a voice in the Chamber of Deputies. For over 60 years, Mexico's Government has been controlled by the PRI, which has won every presidential race and most gubernatorial races. To secure its continuance in power, the PRI has, over the years, relied on extensive patronage and massive government and party organizational resources. Following federal elections in 1988, a total of six parties gained representation in the Chamber of Deputies and two in the Senate-- the latter a first in Mexican history. The combined opposition won an unprecedented 237 seats out of a total of 500 in the lower house and 4 of 64 in the upper. In municipal elections held through December 1989, the government recognized several opposition victories by both left-of-center and right-of-center parties. In the state of Michoacan, for example, the center-left Party of the Democratic Revolution won almost half of the state's municipalities, including the state's capital and most populous city, Morelia. In mid-term elections held in August 1991, the PRI bounced back with a major victory. It increased its representation to 320 in the Chamber of Deputies and 61 in the Senate, won numerous local and municipal offices, and based on official figures released, won several gubernatorial contests. However, opposition claims of electoral fraud in Guanajuato and San Luis Potosi states resulted in one governor-elect declining to take office and another resigning less than 2 weeks after his inauguration. In Guanajuato, an opposition leader was appointed interim governor. The judiciary is divided into federal and state court systems, with federal courts having jurisdiction over most civil cases and those involving major felonies. Under the constitution, trial and sentencing must be completed within 12 months of arrest for crimes that would carry at least a 2-year sentence. Trial is by judge, not jury, in nearly all criminal cases. Defendants have a right to counsel, and public defenders are available. Other rights include defense against self-incrimination, the right to confront one's accusers, and the right to a public trial. Supreme Court justices are appointed by the President and approved by the Senate.

DEFENSE

Mexico's armed forces in 1991 numbered about 170,000. The army makes up about three-fourths of the total. One year of limited training is required of all males reaching age 18. A paramilitary force of communal landholders is maintained in the countryside. Principal military roles include narcotics control, maintenance of public order, and civic action assignments such as road-building and disaster relief. Military expenditures constituted about 0.5% of GDP in 1991.
Principal Government Officials
President--Carlos Salinas de Gortari Foreign Minister--Fernando Solana Morales Ambassador designate to the US--Jorge Montano Martinez Ambassador designate to the United Nations--Manuel Tello Macias Ambassador to the OAS--Alejandro Carrillo Castro Mexico maintains an embassy in the United States at 1911 Pennsylvania Ave., NW, Washington, DC 20006 (tel. 202-728-1600). Consular offices are located at 2827 16th St., NW, 20009 (tel. 202- 736-1000), and the trade office is at 1776 I St., NW, 20016 (tel. 202-728-1679). Consulates general are located in Chicago, Dallas, Denver, El Paso, Houston, Los Angeles, New Orleans, New York, San Francisco, Miami, San Antonio, and San Diego; consulates are (partial listing) in Atlanta, Boston, Detroit, Philadelphia, Seattle, St. Louis, and Tucson.

POLITICAL CONDITIONS

President Salinas began his 6-year term in 1988. Salinas, holding a Harvard doctorate, was Secretary of Programming and Budget in the De la Madrid Administration (1982-88), where he played a prominent role in formulating economic policy. Significant themes of the Salinas Administration have included adopting market-oriented economic policies, lowering inflation and reducing the foreign debt burden, pursuing a free trade agreement with the US and Canada, opening the political system, combatting narcotics trafficking, bolstering environmental protection, and curtailing corruption and human rights abuse.

ECONOMY

The Mexican Government has taken bold steps in recent years to restructure the economy. Monetary and fiscal discipline and a wage/price stabilization program have reduced inflation from more than 150% in 1987 to 19% in 1991 and an estimated 12% in 1992. With the acceleration of market-oriented reforms, Mexico's real GDP growth rate went from 2% in 1987 to 3.6% in 1991. The Mexican economy has gradually decreased its dependence on petroleum exports, which accounted for 30% of 1991 exports, down from 75% in 1982. As another indication of its commitment to economic reform and trade liberalization, Mexico acceded to the General Agreement on Tariffs and Trade (GATT) in 1986. The government has taken steps to put public finance on a sound footing through privatization and deregulation of state-owned companies, elimination of subsidies to inefficient industries, dramatic reduction of tariff rates, and shrinking the overall financial deficit from nearly 17% of GDP in 1987 to a projected surplus equal to 0.8% of GDP in 1992. In 1982, the Mexican Government owned 1,155 parastatal enterprises; by mid-1992, the number had dropped to 230. Eighty-seven of these were in the process of being privatized. Such measures, along with increased confidence in the economy, have brought down real short-term interest rates to about 4% in mid-1992, from 30% in 1990. In addition, in 1989 Mexico was the first country to participate in the US-sponsored "Brady Plan" to help developing countries reduce foreign commercial bank debt. This helped reduce Mexico's foreign debt from its high of $107 billion in 1987 and has further restored business confidence and sparked a return of expatriated capital. Presidents Bush and Salinas seized the opportunity to cement an enduring and mutually beneficial US-Mexican relationship when they endorsed in June 1990 the idea to negotiate a comprehensive free trade agreement. In February 1991, they were joined by Canadian Prime Minister Mulroney in announcing their intention to pursue the North American Free Trade Agreement (NAFTA). The three leaders had a vision that, by breaking down the barriers to trade and investment throughout the continent, NAFTA would create new opportunities and would generate economic growth for their respective countries. NAFTA also serves as a basis for enhancing on-going US-Mexican cooperation on a host of issues. As the two countries stand on the threshold of the 21st century, cooperation on issues such as migration, environmental pollution, and narcotics control--which do not respect national borders--is of critical importance. Mexico's economic growth is vital to its political prospects and has a substantial and direct impact on the US economy. Mexico is our third-ranked trading partner, purchasing two-thirds of its imports from the United States and sending two-thirds of its exports here. Chief US exports to Mexico are motor vehicle parts, office equipment, and agricultural products; top imports from Mexico include petroleum, cars, piston engines, and coffee. The US is the source of two-thirds of direct foreign investment in Mexico. Both US exports and investment have increased as Mexico has progressively opened its economy.
Agriculture
Mexico's agrarian reform program began more than 50 years ago, when land was distributed to landless farmers. By now, almost all available land has been distributed. Raising productivity and living standards of subsistence farmers has been slow, however, due to poor soils and rural population growth. The government stresses increased production of basic crops, such as corn and beans. Emphasis also is given to export crops such as coffee, tomatoes, and winter vegetables. The government hopes to revitalize food production by extending its economic reform program to the agricultural sector. After years of stagnant agricultural production, improved weather conditions in 1990 helped boost Mexico's production of corn, sorghum, and beans. On the other hand, rice and soybean production fell, as farmers shifted toward more profitable crops. In 1992, President Salinas introduced major reforms to Article 27 of the Mexican Constitution, which regulate rural land tenure. As a consequence, Mexican farmers have more autonomy. They may own their land outright, mortgage it, or associate themselves with outside investment. The reforms are aimed at increasing rural productivity and living standards.
Mineral and Energy Resources
Mexico is rich in mineral and energy resources, and mineral exports are an important element in foreign trade. A leading producer of silver, sulfur, lead, and zinc, Mexico also produces gold, copper, manganese, coal, and iron ore. The discovery of extensive oil fields in the coastal regions along the Gulf of Mexico in 1974 enabled Mexico to become self-sufficient in crude oil and to export significant amounts. With crude oil production averaging 3 million barrels per day during 1991, Mexico ranks as the world's fifth- largest oil producer. About half of the oil is refined and consumed domestically, leaving the remainder for export. Proven oil reserves total 45 billion barrels, about 7% of the world's proven reserves. Total hydrocarbon reserves, including natural gas, are estimated at 67 billion barrels.
Manufacturing and Foreign Investment
During 1991, Mexico's manufacturing sector accounted for about one-fourth of the GDP and nearly 60% of exports. It grew by 3.7% during that year. Important gains have been made in the production of cement, aluminum, synthetic fibers, chemicals, fertilizers, petrochemicals, and paper. A growing automobile industry has become one of Mexico's most important industrial and export sectors. Total foreign investment at the end of March 1992 was $33.2 billion. The government announced sweeping revisions of Mexico's foreign investment regulations in 1989. The most important of these is the explicit permission for foreigners to have majority ownership in companies. This is, in effect, a reversal of laws which, in most cases, limited foreign ownership to 49%. The government has also announced that special trust funds will be set up to liberalize foreign access to the Mexican stock market. Key sectors of the economy, including energy, power generation, and railroads, remain restricted to Mexican ownership or the state.
Transportation and Communications
Mexico's land transportation network is one of the most extensive in Latin America. The 36,000 kilometers of railroads are government owned. Tampico and Veracruz on the Gulf of Mexico are Mexico's two major ports, although the government is developing additional ports on the Gulf of Mexico and on the Pacific as well. A number of international airlines serve Mexico, with direct or connecting flights from most major cities in the United States, Canada, Europe, and Japan. Most Mexican regional capitals and resorts have direct air lines with Mexico or the United States. The Salinas Administration is attempting to modernize infrastructure and services, deregulate and develop more efficient transport systems, and privatize all sectors except those constitutionally restricted. Mexico has taken significant steps to modernize its telecommunications system. A key element was the privatization in 1990 of the national telephone company, Telefonos de Mexico (TELMEX), which was sold to a consortium of Mexican investors, Southwestern Bell, and France Telcom. This privatization has meant an increased rate of investment in infrastructure to permit improvement in the telephone network. In addition, eight regional companies are providing cellular telephone service to various parts of Mexico, resulting in a dramatic expansion of cellular telephone users. Two larger satellites have been ordered to replace the two currently in use. The government has also opened the telecommunications sector to further foreign investment.

FOREIGN RELATIONS

The Government of Mexico has sought to maintain its interests abroad and project its influence largely through moral persuasion and selective economic assistance. In particular, Mexico champions the principles of non-intervention and self-determination. In its efforts to revitalize Mexico's economy and open it to international competition, the Salinas Administration has sought closer relations with the US, Western Europe, and the Pacific Basin. While past Mexican and US policies have differed over regional conflicts in Central America, both countries agree on the ultimate goal of establishing a lasting peace based on economic and social justice and democracy. To that end, Mexico participates in a number of recent regional initiatives to promote peace, democratization, and economic development in Central America. Mexico's cooperation in world affairs has extended outside the hemisphere. In August 1990, immediately after the Iraqi invasion of Kuwait, the Mexican Government announced that it would increase oil production capacity by 100,000 barrels a day to demonstrate its solidarity. Mexico actively participates in several international organizations. Although Mexico is a strong supporter of the UN system, it also pursues its interests through a number of ad hoc international bodies. Mexico has been selective in its membership in other international organizations. To date, it has declined to become a member of the Organization of Petroleum Exporting Countries and the Nonaligned Movement. Nevertheless, Mexico acceded to the General Agreement on Tariffs and Trade (GATT) in 1986.

US-MEXICAN RELATIONS

US foreign relations with Mexico are among its most important and complex. They are shaped by a mixture of mutual interests, shared problems, growing interdependence, and differing national perceptions. Historical factors, cultural differences, and economic disparities add further intricacy to the relationship. The scope of US-Mexican relations goes far beyond diplomatic and official contacts; it entails extensive commercial, cultural, and educational ties. Along our 2,000-mile shared border, state and local governments interact closely. The two countries cooperate to resolve many issues, including trade, finance, narcotics, immigration, environment, science and technology, and cultural relations. An independent, strong, and economically healthy Mexico is a fundamental US interest. Both governments actively discuss ways to improve cooperation on an array of bilateral issues. Since 1981, this process has been formalized in the US-Mexico Binational Commission, composed of several US cabinet members and their Mexican counterparts. The Commission holds annual plenary meetings, and many sub-groups meet during the course of the year to discuss a range of topics, including trade negotiations and investment opportunities, financial cooperation, narcotics, migration, law enforcement, cultural relations, education, border cooperation, environment, labor, agriculture, housing and urban development, fisheries, and tourism.
PRINCIPAL US OFFICIALS
Ambassador--John D. Negroponte Deputy Chief of Mission--Allen L. Sessoms Counselor for Political Affairs--Theodore S. Wilkinson Counselor for Economic Affairs--Donald F. McConville Counselor for Labor Affairs--John W. Vincent Counselor for Public Affairs (USIS)--William Dietrich Counselor for Consular Affairs--Patricia Langford Consul General--Kathleen Mullen Counselor for Scientific and Technological Affairs--Ahmed Meer Counselor for Commercial Affairs--Roger Wallace Consul Generals and Consuls Consulate General, Ciudad Juarez--Richard Peterson Consulate General, Guadalajara--John P. Jurecky Consulate, Hermosillo--Gregory Frost Consulate, Matamoros--Janice Jacobs Consulate, Merida--Staphanie A. Smith Consulate General, Monterrey--Jake Dyels Consulate General, Tijuana--Edwin Cubbison
Consular Agents
Acapulco--Lambert J. Urbanek Cancun--Lorraine H. Lara Durango--Kenneth F. Darg Oaxaca--Mark A. Leyes Puerto Vallarta--Jeanette McGill San Luis Potosi--Kathleen C. Reza San Miguel de Allende--Col. Philip Maher Tampico--Mary Elizabeth Alzaga Veracruz--Edwin L. Culp The US embassy in Mexico is located at Paseo de la Reforma 305, 06500 Mexico, DF. Tel. (from the US): 011-52-5-211-0042.
North American Free Trade Agreement
In separate ceremonies in the three capitals on December 17, 1992, President Bush, Mexican President Salinas, and Canadian Prime Minister Mulroney signed the historic North American Free Trade Agreement. The proposed agreement will eliminate restrictions on the flow of goods, services, and investment in North America. This includes phasing out tariffs over a period of up to 15 years, elimination (as far as possible) of non-tariff barriers, and full protection of intellectual property rights (patents, copyrights, and trademarks). The agreement also includes provisions covering trade rules and dispute settlement. NAFTA marks the first time in the history of US trade policy that environmental concerns have been directly addressed in a comprehensive trade agreement. In addition, parallel labor agreements with Mexico reflect concerns raised in connection with NAFTA. With the December 17 signing, the next step is to seek approval in the respective legislatures of the three countries. Once it is approved, NAFTA is scheduled to enter into force on January 1, 1994.
US-Mexico Integrated Border Environmental Plan
On November 27, 1990, the Presidents of Mexico and the United States instructed their environmental authorities to prepare a comprehensive plan to examine ways and means to reinforce border cooperation with a view to solving the problems of air, soil, and water pollution and hazardous wastes along the border. The US-Mexico Integrated Border Environmental Plan was published in February 1992 by interagency groups led by the Environmental Protection Agency (EPA) and the Secretariat for Social Development (SEDESOL). The goals of the plan, which is based on the 1983 La Paz Border Environment Agreement, are to provide long-term protection of both human health as well as of the natural ecosystems that thrive along the border. The four immediate objectives of the plan are: to strengthen enforcement of existing laws; to reduce pollution through new initiatives; to increase cooperative planning, training, and education; and to improve understanding of the border environment. Mexico has committed itself to investing at least $460 million over the next 3 years in environmental protection of Mexican border cities. The US Administration has requested appropriations of $241 million in 1993 for border clean-up. The Mexican Government has also budgeted $220 million for the treatment of vital water resources along the border. At the close of 1994, the plan will be reexamined and, in its second stage from 1995 to 2000, binational environmental protection efforts will be reviewed, refined, and possibly redirected. The plan is an example of existing and projected cross-border environmental cooperation which may serve as a prototype for other nations.
International Boundary and Water Commission
Preceded by several short-term commissions to survey and mark the boundary after its creation in 1848 and modification in 1853, the International Boundary Commission was established as a permanent, joint commission by treaty in 1889. The Water Treaty of 1944 extended its authority to the land boundary and added to its responsibilities the boundary water problems which were becoming more important at that time. The 1944 treaty renamed the body the International Boundary and Water Commission, United States and Mexico (IBWC). It also required that the US and Mexican commissioners be engineers. The IBWC has a wide range of responsibilities and specific programs for solution of US-Mexican water and boundary problems. These include distribution between the two countries of the waters of the Colorado River and the Rio Grande; joint operation of international dams on the Rio Grande to control floods, conserve waters, and generate electricity; other joint flood control works along boundary rivers; solution of border water quality control problems; and stabilization of the river boundaries. These responsibilities and programs are carried out in accordance with various treaties and agreements. The IBWC has successfully resolved many difficult and long-standing problems. For example, the Chamizal Settlement of 1963 resolved a 100-year-old dispute at El Paso/Ciudad Juarez by exchange of territory and rechanneling the Rio Grande. A permanent solution to the international problem related to the salinity of the Colorado River was reached in 1973. Since the early 1980s, the IBWC has focused on troublesome border sanitation problems and has been studying groundwater resources along the boundary.

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Published by the US Department of State Bureau of Public Affairs -- Office of Public Communication -- Washington, DC -- January 1993 -- Editor: Peter Knecht Department of State Publication 7365 Background Notes Series -- This material is in the public domain and may be reprinted without permission; citation of this source is appreciated. For sale by the Superintendent of Documents, US Government Printing Office, Washington, DC 20402. Contents of this publication are not copyrighted unless indicated. If not copyrighted, the material may be reproduced without consent; citation of the publication as the source is appreciated. Permission to reproduce any copyrighted material (including graphics) must be obtained from the original source.(###)