Yucataan in an Era of Globalization

Yucataan in an Era of Globalization

Yucataan in an Era of Globalization

Yucataan in an Era of Globalization

Excerpt

Mexico's 1982 crisis was rooted in a huge, unsustainable external public debt, a sheltered inefficient manufacturing sector, and the dominant role of oil in the country's export profile. Mexico's debt problem in turn was linked closely to the systemic crisis of its public enterprises, whose number grew explosively from 84 in 1970 to 740 in 1976 and 1,155 in 1982. In his first address to the Mexican Congress in December 1982, President Miguel de la Madrid (1982– 88) lamented: “The majority of public enterprises not only register permanent deficit, but their financial statements reflect bankruptcy.” The consolidated losses of these debt-burdened entities reached 8 percent of Mexico's GDP, or nearly half of the national fiscal deficit. For Yucatán, Mexico's debt crisis and its aftermath had profound implications: in a climate of extreme fiscal austerit y, the federal government no longer could afford the luxury of subsidizing the state's moribund agri-industrial henequen industry.

Since 1982 Mexico's path toward globalization has been a tortuous one marked by two recessions and episodes of high inflation. The December 1994 peso crisis was followed in 1995 by a severe domestic market contraction and massive bankruptcies. Although impressive in terms of numbers of enterprises divested, Mexico's privatization process has been flawed by political cronyism in some instances. The key energy sector—oil, natural gas, and electricity—has been neither privatized nor reformed. Still, on balance, the shift of about one thousand enterprises from the public to the private sector between 1983 and 2003 has substantially benefited Mexico. Privatization has provided revenues needed to dramatically reduce the country's crushing external debt burden and increase spending for education and poverty alleviation. Improvements in firm performance resulting from efficiency gains have given Mexicans greater access to goods and services.

Transparency International's 2005 “Corruption Perceptions Index” (CPI) indicates that Mexico has issues related to the rule of law. Among the 159 countries included in its survey, Mexico ranked 65th, well above Chile (21st) and Uruguay (32nd), the least corrupt in Latin America. With its 2005 CPI score of only 3.5, Mexico is placed in the company of Ghana, Peru, and . . .

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