Mexico the Long-Term Good News
It’s time for Canadians to look more closely at that major trading partner of the United States with a growing economy and lengthy, shared border. We’re talking about Mexico, of course. Too much attention is given to the country’s horrific, drug-related murders and the hot-button issue of illegal immigration to the U.S. Not enough is given to Mexico’s continuing economic emergence and a series of reforms, some still in the works, that can set the country on a long-term path of increased growth.
For years, Mexico suffered because China’s low wages made it the no-brainer manufacturing hub. However, Chinese wage inflation means that gap has at least narrowed, and some say it has disappeared. Economists at Merrill Lynch said in April that Mexican wages, nearly double China’s 10 years ago, are now nearly 20 per cent lower.
That, coupled with nearly four dozen international free-trade agreements, is bringing international investment – and stoking a young, growing Mexican middle class with more buying power. In February, New York Times columnist Thomas Friedman said that Mexico “will become the dominant economic power in the 21st century.”……
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