Mexico and NAFTA
...fted trade barriers (making export more profitable). This in turn made the US companies increase their long- term investments in their Mexican factories and other businesses. As a result Mexican exports to the United States have jumped almost three fold from 49.4 billion in 1994 to 135.9 billion in 2000. An increase in employment for the Maquiladora is another benefit for Mexico in NAFTA. The number for workers that produce goods for export has more then doubled (546,433 in 1994 to 1,240,840 in May 2001). Most of these jobs are concentrated in border cities but they are dispersing other areas in Mexico With the positives comes the negatives. First is the drop in wages. Contrary to popular belief the average worker has not seen any significant benefits. (although Mexico's per capita income rose 24%, to just over $4,000 -- which is roughly 10 times China's.) In fact the minimum wage had dropped 18 percent while the average manufacturing wage has dropped 21 percent. Many workers have filed complaints to no avail because NAFTA has provided feeble enforcement on labor rights. This goes hand in hand with the increase in the numbers of Mexicans that are living in poverty. 58.4 percent of the Mexican population is in poverty up form 50.97 in 1994. Another negative is the industrial pollution and natural resource destruction. Despite promises form the promoters of NAFTA the air pollution has doubled. Inspections of the factories has fallen of since NAFTA has been in effect which has raised health issues on both sides of the border. The US has also laid claim to the forestry segment in Mexico because of the agreement. The last of the negatives that I will talk about is Mexico’s financial volatility and debt burden caused by NAFTA. In 1994 investors pulled their money out in the billions. The caused the Mexican government to devalue the peso. By doing this the economy went into crisis. This caused sk...