Mexico: Transnationalism, Neoliberalism and Globalization Report

Subject

Mexico is one of the fastest growing countries as of today and is actually coping with the highly developed countries. At the twelfth rank among all countries in terms of Gross Domestic Product, Mexico is already considered an upper middle-income country at par with Canada and Spain. After a great economic fiasco more than a decade ago, Mexico became a leading country in terms of growth and development most especially in their economical aspects.

The largest city in the Americas and the second biggest city in the world, Mexico has maximized and developed their resources which have led to such a high spot in terms of progress and income. However, Mexico’s economic growth is not an assurance of equality among its residents. In fact, the more Mexico becomes industrialized and urbanized, the greater the gap occurring between the rich and the poor people.

This kind of phenomena is greatly affecting the citizens because it does not promote equality among them most especially in terms of labor income. This so called income inequality does not just make the rich people richer and the poor people poorer but is also greatly manifested between the difference of a rural and urban region, and the north and south part of Mexico.

To start off, we have to understand that in the early 1990s, Mexico suffered from a great economic downfall which led to a marked increase of Mexico’s poverty rate, inequality and many other offshoots of economic declination. With this situation in Mexico, the government has come up with the resort of asking these Transnational Companies to aid them in their recovery. The World Bank (WB) and the International Monetary Fund (IMF) as opportunistic as their ideals are, took the chance of helping Mexico out and soon involved the country in an agreement which would solve their short term problems. What most people didn’t know is that by signing these contracts, they might as well have traded their future to these Transnational Organizations (Global Exchange).

The North American Free Trade Agreement or NAFTA is one of the main reasons being blamed because of these devastating effects of globalization to Mexico. It has failed to fulfill its promise to the public (Stiglitz, 2004) and meet the expectations of the society. In other countries, NAFTA also gave the same effects in the economy but the effects in Mexico are becoming harmful not just in the macro but even in the micro aspect of the society. This certain model of trading was simultaneously introduced to Mexico along with World Bank’s and International Monetary Fund’s help given to the country during their 1994 struggle.

NAFTA or the North American Free Trade Agreement is a trilateral agreement which removes the tariffs on products traded among Canada, United States and Mexico. Many restrictions on products have also been removed and furthermore, focus were given in the intellectual property rights of patented products.

In this endeavor, the researcher would try to identify the underlying factors which led to the worsening condition of Mexican economy due to the intercession of the NAFTA. Furthermore, the effect of NAFTA to other countries will be compared to that of the effect in Mexico so as to see difference or similarities between these countries. Also, the role of NAFTA as a transnational catalyst for economical and political opportunities would be viewed in this research.

Bibliography

• Stern, David. (2007). The Effect of NAFTA on Energy and Environmental Efficiency in Mexico. Policy Studies Journal. Volume 35, Number 2, pp. 291-322(32).

This source is nevertheless important because in it, we can see the effect of NAFTA or these neoliberal policies in either the development or destruction of the natural resources and the environment of Mexico. Basically, this research tends to identify the degree of increase or decrease of emission of harmful pollutants to the atmosphere and makes a comparison between the situations before and after NAFTA’s putting into effect.

The research found out that there is a lowering tendency towards the use of sulfur and the emissions per unit GDP. This effect is positive however, there are things to be lamented upon since in post-NAFTA. One is that the trend for total energy consumption is starting to go upward indicating a high intensity of energy usage. The same applies to carbon and NOx emissions. These data and trends towards emissions gathered are similar to all three countries involves in NAFTA.

• Alvarez, Mendiola, German. (2006). Lifelong Learning policies in Mexico: context, challenges and comparisons. Compare. Volume 36, Number 3, pp. 379-399(21).

This comparative study/ research about Mexico’s state of living before and after NAFTA is important because it points out several weaknesses of Mexico which was further damaged since NAFTA’s emergence in the country.

First is that Mexico is a poor country with a high degree of income inequality. This was already blatant long before. However, with NAFTA in effect, the gap between the rich and the poor further widened making it almost impossible to bridge this gap.

Mexico has a very low educational level. Because of this situation, the doors for more Mexicans to improve and succeed close each time. We all know that one big factor in a person’s success is his educational level/ attainment. Furthermore, educational attainment also has a gap between rich and poor people since most poor people tend not to go to any high end educational institutions.

Also, it was emphasized in this study that México has a large number of adult population and most of which have not attained an optimal level of education contributing to their unproductiveness.

• Coughlin, Cletus C. and Howard Wall. (2003). NAFTA and the changing pattern of state exports. Papers in Regional Science. Volume 82, Number 4 427-450.

We are all aware that economically and theoretically speaking, NAFTA really did well in terms of boosting Mexico’s economic from a hurtful economic downfall. The aspect of the country which is greatly affected by this agreement is the export and import trading between regions of Mexico and other countries which have partnership with Mexico in several industries.

In this paper, we can see an unbiased viewpoint of how NAFTA has greatly affected the export and import aspect of the country. Furthermore, researches on NAFTA have been shown in this paper which indicates that the patterns of state exports have been greatly altered. We can see in this paper that although there is a marked increase in the interstate interaction between Mexico, Canada and USA, there is also a marked decline in the trade between non-NAFTA countries most especially those involving trade with Latin American and European countries. We also recognize the sudden increase in the export trade with Asian countries rather than these NAFTA affected countries.

• Manchester, Joyce and McKibbin Warwick. (1995). The Global macroeconomics of NAFTA. Open Economies Review, 1995, vol. 6, issue 3, pages 203-223.

This article entitled “The Global Macroeconomics of NAFTA” provides us a futuristic approach regarding the said topic. Unlike the common topics on NAFTA which mostly focuses on the disadvantages and detriments to the country and to the people, most especially, this certain work focuses into the future effects and the long term gains which may be achieved by Mexico should NAFTA continue its function.

More than that, the account of facts and scientific predictions regarding the said topic is comprehensive because it also tackles even those shorter effects aside from its long term gains. Projected by this article is the success of gains of Mexico in the near future and that these contemporary issues with regards to NAFTA will soon be eradicated because of its positive effects in the near future.

Tentative Thesis Statement

From the researches conducted and perused regarding the topic at hand, the researcher has arrived at the following thesis statement which would be covered in the entirety of this essay.

We say that although there are several benefits which NAFTA gave to Mexico at the onset of its action like increased agricultural exports to the US from Mexico and decreased US domestic prices (Spann, 2007), there are more detriments which NAFTA cast among people of Mexico. We therefore attempt to prove that these transnational companies along with the Neoliberal policies they bring to countries are hardly able to uplift the economical development- both macro and micro. It is also safe to conclude that NAFTA not only affects the economic aspect of Mexico but even tramples and steps upon the dignity of these people who are marginalized.

Summary

The main argument that can be withdrawn from within these groups of articles is that there are more detriments NAFTA gives Mexico than the benefits it give. There are several reasons for this. One is that the previous benefits given during the early recovery years of Mexico are already fading out and soon, more and more disadvantages are being casted upon poor Mexicans. Say for example, their farmers and crop growers- because of the imports from United States and Canada which are low in price because of less tariffs, more people opt to buy those imported products over those which are made by the natives.

Second, growth of Mexico’s per capita GDP, although higher than most Latin countries, is actually low compared to the percent growth in the previous decades where NAFTA is not yet in effect. Third, income disparities became much wider between the poor and the rich members of the society when in fact, the purpose of NAFTA is to reduce this disparities.

Moreover, NAFTA is a mere hoax because what is being put into effect is America’s interest over weaker states- the thing they do is to let these countries bite into their massive ideas of creating a free trade between them. With these sound bases, the researcher have decided to make an argument that indeed, Transnational Organizations and ideologies can really cause harm among the people in a certain country, making the gap between the needy and the less needy people wider as time passes. This form of globalization is a manifestation that globalization does not actually suffice the needs of a certain country for development. There are many factors which should, nevertheless, be considered.

More than that, it is also conclusive that these Neoliberal Policies have a detrimental effect on the lives of the people in general. The rights of the people which are being trampled upon and deprived are analyzed and elucidated. The effects of these factors on Human Rights were put into consideration in the articles which further explains the impact of these neoliberal policies on human development.

Out of these series of articles, one argument which can be extracted is that these policies enacted by Transnational Organizations violate the principles stated in the Universal Declaration of Human Rights (Global Exchange, 2001)..

First, it violates a person’s fundamental right to work, to choose the type of employment and to be protected against unemployment. With NAFTA in effect, these rights of people are not being practiced and secured because there is a great chance that their businesses will be overcome by imported products and will soon die off because of lack of income.

Another right which it deprives from people is the right to receive equal compensation. This is obviously not happening in Mexico wherein the income difference in between the rich and poor gets wider every minute.

References

Alvarez, Mendiola, German. (2006). Lifelong Learning policies in Mexico: context, challenges and comparisons. Compare. Volume 36, Number 3, pp. 379-399(21).

Stern, David. (2007). The Effect of NAFTA on Energy and Environmental Efficiency in Mexico. Policy Studies Journal. Volume 35, Number 2, pp. 291-322(32).

Spann, Ora, et al. (2007). Mexican agricultural exports: effect on trade flows and prices in the USA under NAFTA. World Review of Entrepreneurship, Management and Sustainable Development. Volume 4, Number 1, 9 pp. 46-58(13).

UNPD Mexico Report on HDI. United Nations (2004). Web.

Countries Ranked by GDP. World Bank Report. The World Bank (2007-04). Web.

List of upper middle-income countries. The World Bank. Web.

CIA The World Fact book. “Mexico – Economy”. CIA. Web.

Global Exchange. (2001). How the International Monetary Fund and the World Bank Undermine Democracy and Erode Human Rights: Five Case Studies. Global Exchange. Web.

Bakvis, Peter. (2004). “Distorted World Bank Report on NAFTA and Labor.” Economic Justice News Online (US Network for Economic and Global Justice). Web.

“Mexico: A Death in the Desert. Frontline/World.” North American Free Trade Association. Web.