Mexico on the Rise – Here to Stay or More of the Same Instability?

Mexico’s economy is booming, despite loud concerns that returning power to the traditional Institutional Revolutionary Party (PRI) would mean a return to a despotic cronyism.  It is the second largest export market and has a flourishing network of trade internationally. The incessant drug war is also seeing somewhat more peaceful days. However, corruption, poverty, crime and meager public services continue to weigh the country down as a credible player on the world stage.

Will Mexico rise as a solid and even leading neighbor to the United States and Latin American countries – or will this be a short-termed prosperity that will again be swindled away as it was during the previous 100 years under the (PRI) Party?

[protected]Mexico’s way forward will be determined by three main factors:  1) credibility as a trade and thought partner, 2) a concerted effort to bridge the income gap and enlarge the educated workforce (e.g. by investing in education, a fruitful job market, infrastructure), and 3) stemming drug war violence and crime, as well as its spillover effects into the United States and neighboring Latin American countries.

These are all very large issues to tackle and will need powerful legislation and collaboration to see results. The recently elected government under President Enrique Peña Nieto will need to stay headstrong in the face of corruption and cronyism. Although the former government saw carnage and havoc for trying to push out the old system of bent deals, the new government should not choose the easy way out and let the cartels run the show. It is a long but necessary battle to conquer the ‘narcos’ and bring them to justice.

A large part of the problem is weak enforcement, caused by meager pay, lack of education and understandable fears of retaliation from gangs better equipped than most modern-day soldiers. As the drug trafficking issue is a multinational web of illicit networks and cash flows, Mexico will need to ramp up its collaboration with the United States, Guatemala and other Latin American countries to develop a comprehensive approach to the problem.

Furthermore, Mexico should continue to distance itself from the ideological extremism of ruling parties in Venezuela and others who will not suit its interests in the long run. Venezuela, Ecuador, Nicaragua, Bolivia and others who consider the United States as an adversary are not viewing the region’s growth in a broader context. Mexico should continue on a path towards more openness, more domestic investment and additional trade partnerships that will make the country more prosperous and have a louder voice on the global stage.  Just one day ago, Mexico stated its intentions to establish an economic partnership agreement (EPA) with Indonesia[1] – another export powerhouse that can greatly benefit from the exchange of raw materials and production goods.

Another serious issue is Mexico’s income gap. Recent statistics claim that 10% of the population in Mexico holds over 40% of the country’s wealth. Nosotros los Nobles, a recent hit film, highlights the socio-economic repercussions of this disparity, but arrogant, disconnected youth is only the surface of a deep-rooted problem.

A large part of this will be an investment and restructuring of the educational system. The benefit of focusing on Mexican youth is two-fold – it prepares them for the job market and it deters them from joining gangs.  There has been some improvement in the past decade – the Mexican middle class grew by 17%. This has ties to better communication, infrastructure and entrepreneurship. President Peña Nieto has also recently moved to implement an evaluation system in the form of an independent body to assess teachers; the result of this legislation is yet to unfold, but would also require significant financial commitment to ensure progress.

The PRI government is ostensibly off to a good start – at least in introducing possible reforms. But it has a long way to go. The United States should recognize its vested interest in Mexico’s stability and development and offer a helping hand. The United States seems to be more motivated in creating stability overseas than to stop the more than 70,000 deaths in the Mexican drug war since 2006.[2] No boots on the ground have been provided.  

The upcoming meeting between U.S. President Barack Obama and President Peña Nieto on May 2 will be a great chance to set concrete steps for a forward-looking partnership.[/protected]


[1] http://www.thejakartapost.com/news/2013/04/23/mexico-expects-free-trade-deal-with-indonesia.html

[2] http://www.drugpolicy.org/drug-war-statistics

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Sophia Lambert

About Sophia Lambert

Sophia Lambert is the Head of Marketing at Atheneum Partners. She graduated from Georgetown University in Washington, D.C. with a degree in Political Science and History. Prior to joining Atheneum, Sophia worked for the U.S. Department of State, U.S. Mission to the United Nations, U.S. Congress and the U.S. Department of Justice.