As with their environmental policy regimes, each of Mexico, Brazil, Argentina and Costa Rica have extensive programs in place for attracting private investment. Each shares some broad similarities with differences reflecting local circumstances and priorities.
The basic framework for international private investment in Mexico is the Law on Foreign Investment (Ley de Inversion Extranjera). It liberalized the former policy of requiring majority Mexican participation in most investments and opened up sectors for investment that had previously been off limits. Some investment restrictions remained for air transport, financial institutions and services, media, telecommunications, and fuel supply to ships and trains. The National Commission on Foreign Investment (Comision Nacional de Inversion Extranjera) is required to review investment applications, including consideration of their social, environmental, and economic impacts.
The Mexican national government has promoted a number of investment opportunities and programs. State-owned enterprises have been privatized, the constitution has been modified to allow the private sector to enter the natural gas industry, and the maquiladora program has promoted manufacturing investment along the US-Mexico border. Also known as the Border Industrialization Program, this effort allows foreign firms to bring raw materials and components to their Mexican facilities duty-free on condition that at least 50 percent of the production is exported.
Brazil, in 1995, amended its constitution to give foreign companies unlimited access to the domestic credit market and to sectors that were previously reserved for domestic investors. Foreign investors are given national treatment and allowed to take ownership interests in companies in the financial, telecommunications, transportation, and energy sectors (with the exception of air transportation and atomic energy). They are also to be taxed in a manner equivalent to national companies.
After years of relatively low interest from foreign investors, in the early 1990s Argentina attracted considerable amounts of international investment through its privatization program. This included the sale of publicly owned corporations in the telecommunications, airlines, railways, electricity generation, oil and gas, maritime, roads and highways, radio and television, water supplies, meat-processing plants, petrochemicals, military industrial installations, shipyards, steel, and financial sectors. In addition, Argentina has undertaken a structural adjustment program emphasizing market- oriented reform. The mining sector is one of the best illustrations of the new policy framework for attracting direct investment. Mining reform