Successful Integration and Economic Distress: The New Dual Economy — the Case of Mexico in NAFTA
- 15 Downloads
1994 was the first year of Mexican integration in the North American Free Trade Agreement (NAFTA), and the start of a period when Mexico was supposed to benefit from the further opening up of its economy. It turned out, however, to be one of the most turbulent years in the recent history of the Mexican economy. The substantial outflow of capital which began in the second quarter of 1994, ultimately led to a significant loss of foreign exchange reserves, abandonment of the pegged exchange rate regime, and a 71 per cent real depreciation of the peso. The question frequently raised was, what went wrong with the Mexican economy? After all, it appeared that the programmes for stabilization and structural change that were implemented by the Mexican authorities from the mid-1980s were rather successful in reducing the rate of inflation and improving the efficiency of Mexican producers. Above all, the core of the new programmes was from the begining oriented towards creating a new structural relationship with the rest of the world: essentially a new pattern of integration.
KeywordsExchange Rate Real Exchange Rate Trade Liberalization Successful Integration North American Free Trade Agreement
Unable to display preview. Download preview PDF.
- Bairoch, P. (1996) ‘Globalization Myths and Realities: One Century of External Trade and Foreign Investment’, in R. Boyer and D. Drache (eds), States Against Markets (New York: Routledge).Google Scholar
- Bueno, G. (1960) ‘La estructura de proteccion en Mexico’, mimeo.Google Scholar
- Garrido, C. (1995) ‘The Mexican Financial System in the Nineties’, UAM working paper.Google Scholar
- Hahn, F. and Solow, R. (1995) A Critical Essay on Modern Macroeconomic Theory (London: Blackwell).Google Scholar
- Official PublicationsGoogle Scholar
- Cuentas Nationales, INEGI, 1970–95.Google Scholar
- International Financial Statistics, published by the IMF (1985–95).Google Scholar
- Mexican Bulletin of Statistical Information, no. 13, July–September 1994.Google Scholar
- The Mexican Economy, 1995, El Banco De Mexico.Google Scholar
- Indicadores Economicos, El Banco de Mexico. Junio 1996.Google Scholar