Mexico

Economic and political outline

Economic indicators | Foreign Trade in figures | Sources of economic information | Political outline

Economic indicators

Mexico is highly dependent on exports to the U.S., which account for almost a quarter of the country’s GDP. As the U.S. economy has emerged from its downturn in 2001, so has the Mexican economy; with its GDP growing at 4.8% in 2006 and 3% in 2007. Also rise in the international oil prices and relaxation in the country’s monetary policy has contributed to the economy’s revival. The weak point of the Mexican economy is its heavy dependence on the US exports: 80% of Mexican foreign trade is carried out with the US. Both unemployment (around 3%) and inflation (around 3.5%) are under control.

GDP Indicators	2004	2005	2006	2007	2008
GDP (billions USD)	683.49	767.69	840.01	886.44e	939.29e
GDP (constant prices, annual % change)	4.2	2.8	4.8	2.9e	3.0e
GDP per capita (USD)	6,697.57	7,446.86	8,066.25e	8,426.27e	8,838.60e
Inflation rate (%)	4.7	4.0	3.6	3.9e	4.2e
Unemployment rate (% of the labor force)	3.7	3.5	3.2	n.c.	n.c.
Current Account (billions USD)	-6.69	-4.91	-2.43	-6.37e	-10.59e
Current Account (in % of GDP)	-1.0	-0.6	-0.3	-0.7e	-1.1e

Source: IMF - World Economic Outlook Database; ILO, Laborstat - Yearly Statistics

Note: (e) Estimated data

Socio-demographic indicators	2004	2005	2006
Unemployment rate (%)	3.7	3.5	3.2

Source:

Main sectors of industry

Agriculture accounted for 4% of GDP and employs nearly 16% of the active population. However, poor availability of credit continues to plague agriculture. Mexico ranks among the world's largest producers of coffee, sugar, corn and oranges. Mexico is among the world's leading producers of many minerals, including silver, fluorite, zinc, and mercury, and its oil & gas reserves are one of its most valuable assets (5th largest oil producer in the world). The free economic zones dedicated to US exports called ‘Maquiladoras’, which were early driving the economy, are now going through crisis because of the competition from low cost Asian & East European countries. As a result manufacturing sector has dramatically slowed down in recent years and now contributes around 15% to the country’s GDP. However the building & construction sector is doing well, fuelled by boom in housing finance. Livestock raising and fishing are also significant economic activities. The services sector contributes nearly 70% to the GDP.

Breakdown of economic activity by sector	Agriculture	Industry	Services
Value added (annual % change)	4.8	5.0	4.7
Value added (in % of GDP)	3.9	26.7	69.4
Employment by sector (in % of total employment)	15.1	25.7	58.6

Source: World Bank - World Development Indicators - last available data.

Monetary indicators	2002	2003	2004	2005	2006
Average annual exchange rate for 1 USD	9.66	10.79	11.29	10.90	10.90

Source: World Bank - World Development Indicators

Foreign trade in figures

Mexico is one of the world’s most trade dependent countries. The share of foreign trade in countries GDP is nearly 60%. Mexico is a member of the NAFTA- free trade agreement unifying the United States, Mexico and Canada since 1994. The country signed a free trade agreement with the European Union in 2000 and the commercial agreement signed with Japan came into force on April 2005. USA buys 80% of its exports. The top three export partners are: the USA, Canada and Spain. The commodities mainly exported are electric & electronic equipment, vehicles, mineral fuels & oils, and machinery. The top three import partners are: the USA, China and Japan. It mainly imports electrical & electronic equipment, machinery, vehicles, plastics and mineral fuels & oils.

Foreign trade indicators	2002	2003	2004	2005	2006
Imports of goods (millions USD)	168,679	170,546	196,810	221,820	256,131
Exports of goods (millions USD)	161,046	164,766	187,999	214,233	250,292
Imports of services (millions USD)	17,660	18,141	19,779	21,440	23,340
Exports of services (millions USD)	12,740	12,617	14,047	16,137	16,352
Imports of goods and services (annual % change)	1.5	0.7	11.6	8.6	12.2
Exports of goods and services (annual % change)	1.4	2.7	11.6	7.1	11.1
Imports of goods and services (in % of GDP)	28.6	29.4	31.6	31.5	33.2
Exports of goods and services (in % of GDP)	26.8	27.8	29.6	30.0	31.9
Trade Balance (millions USD)	-7,633	-5,780	-8,811	-7,587	-5,838
Trade Balance (including service) (millions USD)	-12,553	-11,304	-14,543	-12,890	-12,827
Current Account (millions USD)	-14,109	-8,851	-6,689	-4,898	-1,475
Current Account (in % of GDP)	-2.2	-1.4	-1.0	-0.6	-0.2
Foreign trade (in % of GDP)	55.5	57.2	61.2	61.5	65.1

Source: World Bank - World Development Indicators

Main partner countries

Main customers (% of exports)	2006
United States	84.9%
Canada	2.1%
Spain	1.3%
Germany	1.2%
Colombia	0.9%

Main suppliers (% of imports)	2006
United States	51.1%
China	9.5%
Japan	6.0%
South Korea	4.1%
Germany	3.7%

Source: 2006

Main products

Main exports (% of exports)	2006
Electrical machinery and equipment	24.7%
Vehicles other than railway or tramway	15.8%
Mineral fuels, mineral oils	15.5%
Machinery and mechanical appliances	13.1%
Photographic, cinematographic, measuring and medical instruments	3.5%

Main imports (% of imports)	2006
Electrical machinery and equipment	22.1%
Machinery and mechanical appliances	15.6%
Vehicles other than railway or tramway	9.8%
Plastics	6.2%
Mineral fuels, mineral oils	5.7%

Source: 2006

To see more products: More imports (Intracen Data)
More exports (Intracen Data)

Sources of economic information

Statistical Office
Central Bank
Stock Exchange
Search Engines: Yahoo Mexico
Buscador
Explora Mexico
Mexico Channel
Mexico Global
Mexico Online
Mexico Web
Mexsearch
Mxsearch
Sbel

Political outline

Main political parties: Mexico has a multi-party system. There are three major political parties in the country: PAN (National Action Party) – a conservative liberal party, PRI (Institutional Revolutionary Party) - when it was founded it was somewhat socialist, currently it is a liberal party ; and PRD (Party of the Democratic Revolution)- a left wing but somewhat socialist party.
Current political leaders: President (outgoing): Vicente FOX Quesada (since December 2000) – PAN
President-elect: Felipe Calderon (will take office on 1 December 2006) -PAN
Next election dates: Presidential: July 2012
Chamber of Deputies: July 2009