Mexico is a country in the Southern part of North America located between the United States and Central America. It is also considered a part of Latin America because Latin America refers to countries located in the Americas that speak Spanish or Portuguese languages. Mexico’s official name is Estados-Unidos Mexicanos translating to the United Mexican States (Brooke, 2006). The Capital of Mexico is Mexico City. Mexico has 32 states in total, which includes 31 states and one federal district. As of 2016, the population was 127.5 million. The dominant language in Mexico is Spanish.
However, there are several languages other than Spanish that are spoken. For instance, Nahuatl which has over one million speakers. Mixtec which has about half a million speakers. Also, the language of Yucatec Maya, which has about a quarter of a million speakers. Mexico gained independence on August 24, 1821 from Spain. On the Mexican flag, the green stripe represents hope, the white stripe stands for purity, and the red stripe signifies the blood of those who died fighting for freedom.
Mexico has a federal republic government. Where, the president is both the head of the government, and the head of state. The government is directed by the constitution of 1917. The government has three branches. The executive branch which the president runs. The Legislative branch which is made up of the chamber of deputies and the senate. The third branch is the Judiciary which is both the federal and state courts, like the supreme court.
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Corruption has been the glue that holds Mexico together. It helped accomplish long periods of economic growth. During 2016, Mexico’s governor accused the federal government of smothering state finances in return for corruption charges against important members of the Mexico’s ruling party. Javior Corrall, the Chihuahua’s governor, stated that “the federal government had withheld £30m to force state prosecutors to quash an investigation into allegations that president Enrique Peña Nieto’s Institutional Revolutionary Party (PRI) used shell companies to improperly finance election campaigns across Mexico in 2016” (David Argen).
The New York Times caused trouble in Mexico when they exposed that President Nieto of Mexico was using complexed spyware. They bought spyware worth over $80 million from Israel. He used the spyware, known as Pegasus, to watch and keep an eye on journalists and human rights activists in Mexico. If a targeted person opens a certain link that is sent through text message, the spyware can gather all information from that smartphone. The link included a message that would convince the receiver to open it. For instance, like a threat that their sex tape leaked or intimidated messages. This spyware is used to fight drug cartels, terrorism and criminal organizations.
Mexico has a weak rule of law. During the 20th century, Mexico did have a strong rule of law for a short while. Their political system created rules and regulations that nearly everyone understood. When Mexico switched to Democracy, everything changed. They turned away from ISI and started following both the National Action Party (PAN) and The Party of the Democratic Revolution (PRD) which at the time, was gaining electoral ground.
The justice system was not prepared to punish law breakers and to fight crime. This was a result of the Mexican government; they did not prioritize order and peace. The government would basically negotiate with criminals. Cartels were able to bribe government officials. For instance, “by and large, the PRI turned a blind eye to the illicit trade, so long as the cartels gave government officials a cut of the profits and prevented the violence from spilling into the traditional plaza” (Steinberg, 28). The government just wanted peace, they allowed illegal drug trade. As long as they stayed out of the governments court and gave them a cut, they were free to do what they wanted. Mexico’s rule of law is weak because even though it is protected in Mexico’s laws, political bosses and crime cartels had the ability to gain control of the land from peasants.
Mexico has a weak property rights system. Bureaucrats and government officials threaten property rights by bribing and blackmailing. The citizens in Mexico do not have high confidence in the Judicial system. They have low confidence in their power and what they can guarantee about equal justice. As you can see from Figure 1 above, their level of low confidence expanded by double the amount from 1981 to 1997.
Under the Mexican Constitution, Article 27 guarantees the sacred right to private property. There are four categories of land occupancy in Mexico: Shared tenancy, private ownership, publicly owned, and unable to sell or transfer. In the world bank data, Mexico ranked 101 out of 190 countries for private property. As shown in Figure 2 above, Mexico’s Rule of Law is at 4 out of 10. Whereas, Mexico’s Property Rights vary between 5-6 out of 10.
PricewaterhouseCoopers (PwC) is doing business with Mexico’s Immex Maquiladora. Immex Maquiladora supports the Mexican economy. They can be established anywhere around the country. The main business of the firm is to carry out manufacturing activities in Mexico. It is an exporting program which is foreign owned. PwC can basically import goods and services that are needed for manufacturing and they will not be subject to duties. Being a part of the Maquiladora program, they are permitted to a cut in income taxes for profits, regarding the exported goods and services. If custom duties are paid, they can sell or transport a portion of their production to the domestic market.
Mexico attracted a lot of foreign owned companies because they could import equipment and material without paying any taxes. In addition, the wages were lower, which is better income for the business. They are responsible for 65% of Mexico’s exports. They employed about 80% of the manufacturing workforce. This was a big increase compared to the amount of struggling Mexico’s economy faced in the previous years. They also export about $178 million US dollars, annually. They could manufacture about 3.6 million cars yearly, which is about 10 thousand cars being made, daily. The Immex Maquiladora export program created endless opportunities in Mexico. It brought the country from struggling to stable.
