Mexico's Map

Geography
Area: 1,972,500 sq. km. (761,600 sq. mi.); about three times the size of Texas.
Cities: Capital--Mexico City (13 million, 2000 census metro area). Other major cities--Guadalajara, Monterrey, Puebla, Ciudad Juarez, Tijuana, Acapulco, Merida, Leon, Veracruz.
Terrain: Coastal lowlands, central high plateaus, and mountains up to 5,400 m. (18,000 ft.).
Climate: Tropical to desert.

People
Nationality: Noun and adjective--Mexican(s).
Population (2004 estimate): 105 million.
Annual growth rate (2004 net): 1.2%.
Ethnic groups: Indian-Spanish (mestizo) 60%, Indian 30%, Caucasian 9%, other 1%.
Religions: Roman Catholic 89%, Protestant 6%, other 5%.
Language: Spanish.
Education: Years compulsory--12 (note: preschool education was made mandatory in Dec. 2001). Literacy--89.4%.
Health (2004 est.): Infant mortality rate--21.69/1000. Life expectancy--male 72.18 years; female 77.83 years.
Work force (2000, 39.81 million): Agriculture, forestry, hunting, fishing--21.0%; services--32.2%; commerce--16.9%; manufacturing--18.7%; construction--5.6%; transportation and communication--4.5%; mining and quarrying--1.0%.

Government
Type: Federal republic.
Independence: First proclaimed September 16, 1810; republic established 1824.
Constitution: February 5, 1917.
Branches: Executive--president (chief of state and head of government). Legislative--bicameral. Judicial--Supreme Court, local and federal systems.
Administrative subdivisions: 31 states and a federal district.
Political parties: Institutional Revolutionary Party (PRI), National Action Party (PAN), Party of the Democratic Revolution (PRD), Green Ecological Party (PVEM), Labor Party (PT), and several small parties.
Suffrage: Universal at 18.

Economy
Nominal GDP (2003 est.): $615 billion; (2004 second quarter) 7.4 trillion pesos.
Per capita GDP (2003 est.): $5,945.
Annual real GDP growth: (2003) 1.3%; (2002) 0.9%; (2001) -0.3%; (2000) 6.6%; (1999) 3.7%.
Avg. real GDP growth (1999-2003): 2.1%.
Inflation rate: (2003) 4.0%; (2002) 5.0%; (2001) 6.4%; (2000) 9.5%; (1999) 16.6%.
Natural resources: Petroleum, silver, copper, gold, lead, zinc, natural gas, timber.
Agriculture (5.8% of GDP): Products--corn, beans, oilseeds, feed grains, fruit, cotton, coffee, sugarcane, winter vegetables.
Industry (26.0% of GDP): Types--manufacturing, petroleum, and mining.
Services (68.3% of GDP): Types--commerce and tourism (18%), financial services (11%), and transportation and communications (10%).
Trade (Goods): Exports (2003)--$164.9 billion. Imports (2003)--$170.5 billion. Exports to U.S. (2003)--$144.5 billion. Imports from U.S. (2003)--$105.4 billion. Major markets (2003)--U.S. (in 2003 destination for 88% of Mexico’s exports; in 2003 source for 62% of Mexico’s imports), EU, Japan, Canada, China, other significant trade partners.

PEOPLE
Mexico is the most populous Spanish-speaking country in the world and the second most-populous country in Latin America after Portuguese-speaking Brazil. About 70% of the people live in urban areas. Many Mexicans emigrate from rural areas that lack job opportunities--such as the underdeveloped southern states and the crowded central plateau--to the industrialized urban centers and the developing areas along the U.S.-Mexico border. According to some estimates, the population of the area around Mexico City is about 18 million, which would make it the largest concentration of population in the Western Hemisphere. Cities bordering on the United States--such as Tijuana and Ciudad Juarez--and cities in the interior--such as Guadalajara, Monterrey, and Puebla--have undergone sharp rises in population in recent years.

Education is one of the Government of Mexico’s highest priorities. The education budget has increased significantly in recent years; funding in real terms for education has increased by almost 25% over the last decade. Education in Mexico also is being decentralized from federal to state authority in order to improve accountability. Although educational levels in Mexico have improved substantially in recent decades, the country still faces daunting problems.

Education is mandatory from ages 6 through 18. In addition, the Mexican Congress voted in December of 2001 to make one year of preschool mandatory, which went into effect in 2004. The increase in school enrollments during the past two decades has been dramatic. By 1999, 94% of the population between the ages of 6 and 14 were enrolled in school. Primary, including preschool, enrollment totaled 17.2 million in 2000. Enrollment at the secondary public school level rose from 1.4 million in 1972 to 5.4 million in 2000. A rapid rise also occurred in higher education. Between 1959-2000 college enrollments rose from 62,000 to more than 2.0 million.

HISTORY
Highly developed cultures, including those of the Olmecs, Mayas, Toltecs, and Aztecs existed long before the Spanish conquest. Hernando Cortes conquered Mexico during the period 1519-21 and founded a Spanish colony that lasted nearly 300 years.

Independence from Spain was proclaimed by Father Miguel Hidalgo on September 16, 1810. Father Hidalgo’s declaration of national independence, known in Mexico as the “Grito de Dolores”, launched a decade long struggle for independence from Spain. Prominent figures in Mexico’s war for independence were Father Jose Maria Morelos; Gen. Augustin de Iturbide, who defeated the Spaniards and ruled as Mexican emperor from 1822-23; and Gen. Antonio Lopez de Santa Ana, who went on to control Mexican politics from 1833 to 1855. An 1821 treaty recognized Mexican independence from Spain and called for a constitutional monarchy. The planned monarchy failed; a republic was proclaimed in December 1822 and established in 1824.

Throughout the rest of the 19th century, Mexico’s government and economy were shaped by contentious debates among liberals and conservatives, republicans and monarchists, federalists and those who favored centralized government. During the two presidential terms of Benito Juarez (1858-71), Mexico experimented with modern democratic and economic reforms. President Juarez’ terms, and Mexico’s early experience with democracy were interrupted by the Habsburg monarchy’s rule of Mexico (1864-67), and by the authoritarian government of Gen. Porfirio Diaz, who was president during most of the period between 1877 and 1911.

Mexico’s severe social and economic problems erupted in a revolution that lasted from 1910-20 and gave rise to the 1917 constitution. Prominent leaders in this period--some of whom were rivals for power--were Francisco I. Madero, Venustiano Carranza, Pancho Villa, Alvaro Obregon, Victoriano Huerta, and Emiliano Zapata. The Institutional Revolutionary Party (PRI), formed in 1929 under a different name, emerged as a coalition of interests after the chaos of the revolution as a vehicle for keeping political competition in peaceful channels. For 71 years, Mexico’s national government was controlled by the PRI, which won every presidential race and most gubernatorial races until the July 2000 presidential election of Vicente Fox Quesada of the National Action Party (PAN).

GOVERNMENT
The 1917 constitution provides for a federal republic with powers separated into independent executive, legislative, and judicial branches. Historically, the executive is the dominant branch, with power vested in the president, who promulgates and executes the laws of the Congress. The Congress has played an increasingly important role since 1997 when opposition parties first made major gains. The president also legislates by executive decree in certain economic and financial fields, using powers delegated from the Congress. The president is elected by universal adult suffrage for a 6-year term and may not hold office a second time. There is no vice president; in the event of the removal or death of the president, a provisional president is elected by the Congress.

The Congress is composed of a Senate and a Chamber of Deputies. Consecutive re-election is prohibited. Senators are elected to 6-year terms, and deputies serve 3-year terms. The Senate’s 128 seats are filled by a mixture of direct-election and proportional representation. In the lower chamber, 300 deputies are directly elected to represent single-member districts, and 200 are selected by a modified form of proportional representation from five electoral regions. The 200 proportional representation seats were created to help smaller parties gain access to the Chamber.

The judiciary is divided into federal and state court systems, with federal courts having jurisdiction over most civil cases and those involving major felonies. Under the constitution, trial and sentencing must be completed within 12 months of arrest for crimes that would carry at least a 2-year sentence. In practice, the judicial system often does not meet this requirement. Trial is by judge, not jury, in most criminal cases. Defendants have a right to counsel, and public defenders are available. Other rights include defense against self-incrimination, the right to confront one’s accusers, and the right to a public trial. Supreme Court justices are appointed by the president and approved by the Senate.

Principal Government Officials
President--Vicente FOX Quesada
Foreign Secretary--Luis Ernesto DERBEZ Bautista
Ambassador to the U.S.--Carlos DE ICAZA
Ambassador to the United Nations--Enrique BERRUGA Filloy
Ambassador to the OAS--Jorge CHEN Charpentier

Mexico maintains an embassy in the United States at 1911 Pennsylvania Ave. NW, Washington, DC 20006 (tel. 202-728-1600). Consular offices are located at 2827 - 16^th St. NW, 20009 (tel. 202-736-1012), and the trade office is co-located at the embassy (tel. 202-728-1686).

Besides its embassy, Mexico maintains 48 diplomatic offices in the U.S. Consulates general are located in Chicago, Dallas, Denver, El Paso, Houston, Los Angeles, Miami, New Orleans, New York, San Antonio, San Diego, and San Francisco; consulates are (partial listing) in Atlanta, Boston, Detroit, Philadelphia, Seattle, St. Louis, and Tucson.

POLITICAL CONDITIONS
On July 2, 2000, Vicente Fox Quesada of the opposition "Alliance for Change" coalition, headed by the National Action Party (PAN), was elected president, in what are considered to have been the freest and fairest elections in Mexico’s history. Fox began his 6-year term on December 1, 2000. His victory ended the Institutional Revolutionary Party’s (PRI) 71-year hold on the presidency.

The introduction of proportional representation has made the bicameral Mexican Congress a more pluralized institution. Currently, no party holds an absolute majority in either house. As competition among Mexico’s three major parties in Congress increases, the legislative branch is playing an increasingly important role in Mexico’s democratic transformation.

Recent Elections
The July 2, 2000, elections marked the first time since the 1910-20 Mexican Revolution that the opposition defeated the party in government. Vicente Fox won the election with 43% of the vote, followed by PRI candidate Francisco Labastida with 36%, and Cuauhtemoc Cardenas of the Democratic Revolution Party (PRD) with 17%. Despite some isolated incidents of irregularities and problems, there was no evidence of systematic attempts to manipulate the elections or their results, and critics concluded that the irregularities that occurred did not alter the outcome of the presidential vote. Civic organizations fielded more than 80,000 trained electoral observers; foreigners--many from the United States--were invited to witness the process, and numerous independent "quick count" operations and exit polls validated the official vote tabulation.

Numerous electoral reforms implemented since 1989 aided in the opening of the Mexican political system, and opposition parties have made historic gains in elections at all levels. Many of the current electoral concerns have shifted from outright fraud to campaign fairness issues. During 1995-96 the political parties negotiated constitutional amendments to address these issues. Implementing legislation included major points of consensus that had been worked out with the opposition parties. The thrust of the new laws has public financing predominate over private contributions to political parties, tightens procedures for auditing the political parties, and strengthens the authority and independence of electoral institutions. Alongside these more general, legal reforms, political parties are experimenting with more open procedures for selecting candidates at all levels of government. The court system also was given greatly expanded authority to hear civil rights cases on electoral matters brought by individuals or groups. In short, the extensive reform efforts have "leveled the playing field" for the parties and opened new opportunities for citizen participation in politics.

Even before the new electoral law was passed, opposition parties had obtained an increasing voice in Mexico’s political system. A substantial number of candidates from opposition parties had won election to the Chamber of Deputies and Senate. As a result of the 2000 and 2003 elections, the Congress is more diverse than ever. In the Chamber, 223 seats belong to the PRI, 154 to the PAN, 96 to the PRD, 17 to the Green Party, and the remaining seats are split among smaller parties. In the 128-seat Senate, the upper house of Congress, the PRI still holds the most seats at 60, but the PAN holds 46, the PRD 16, the Greens 5, and one senator is an independent. Senators serve 6 years in office and Deputies 3 years; neither can be elected to consecutive terms.

Although the PRI no longer controls the Presidency, it remains a significant force in Mexican politics, holding 17 statehouses. In state congressional and mayoral contests since July 2000, the PRI has fared better than the PAN.

Congressional and presidential elections are scheduled to take place in 2006. Candidates from all major parties, as well as independent contenders, are already making their intentions known. Signaling the strength of the opposition parties going into the 2006 presidential elections, both the PRD and PRI won important gubernatorial elections in late 2004 and early 2005. The Mexican Congress has approved absentee voting by mail-in ballot for citizens residing outside the nation’s borders.

Other Reforms
Constitutional and legal changes have been adopted in recent years to improve the performance and accountability of the Supreme Court and the Office of the Attorney General and the administration of federal courts. The Supreme Court, relieved of administrative duties for lower courts, was given responsibilities for judicial review of certain categories of law and legislation. Additional judicial reforms presented by President Fox remain pending before Congress.

Chiapas
An unresolved sociopolitical conflict exists in the southernmost state of Chiapas. In January 1994, insurgents in the state of Chiapas briefly took arms against the government, protesting alleged oppression, neglect of the concerns of Mexico’s indigenous peoples, and governmental indifference to poverty. After 12 days of fighting, a cease-fire was negotiated that remains in effect. Since 1994 sporadic clashes have continued to occur between armed civilian groups, usually over disputed land claims.

As a presidential candidate, Fox promised to renew dialogue with the Ejיrcito Zapatista de Liberaciףn Nacional (EZLN) and address unresolved problems in the state. Following his inauguration, he ordered many troops out of Chiapas, dismantled roadblocks, closed military bases, and submitted revised peace accords to Congress. In August 2001, the peace accords became law, after having been passed by Congress and ratified by more than half of the state legislatures. However, the EZLN contended that amendments made to legislated provisions of the accord diminished their impact, and broke off talks with the Government.

ECONOMY
Mexico is highly dependent on exports to the U.S., which account for almost a quarter of the country’s GDP. The result is that the Mexican economy is strongly linked to the U.S. business cycle. As the U.S. economy has emerged from its downturn in 2001, so has the Mexican economy, growing at a 4.2% rate in 2004.

Mexican trade policy is among the most open in the world, with Free Trade Agreements with the U.S., Canada, the EU, and many other countries. Since the 1994 devaluation of the peso Mexican governments have improved the country’s macroeconomic fundamentals. Inflation and public sector deficits are both under control. As of September 2004, Moody’s, Standard & Poors, and Fitch Ratings had all issued investment-grade ratings for Mexico’s sovereign debt.

Trade
Mexico is one of the world’s most trade dependent countries, and it is particularly dependent on trade with the U.S, which buys approximately 88% of its exports. Top U.S. exports to Mexico include electronic equipment, motor vehicle parts, and chemicals. Top Mexican exports to the U.S. include petroleum, cars, and electronic equipment. There is considerable intra-company trade.

Mexico is an active and constructive participant in World Trade Organization (WTO) matters, including in the launching of the Doha trade round. Mexico hosted the WTO Ministerial Meeting in Cancun September 2003. The Mexican Government and many businesses support a Free Trade Area of the Americas.

Trade disputes between the U.S. and Mexico are generally settled in WTO or North American Free Trade Agreement (NAFTA) panels or through negotiations between the two countries. The most significant areas of friction involve agricultural products including sugar, high fructose corn syrup, apples, and rice.

Agriculture
Mexico's agrarian reform program began in 1917, when the government began distribution of land to farmers. Extended further in the 1930s, delivery of land to peasants continued into the 1960s and 1970s at varying rates. This cooperative agrarian reform, which guaranteed small farmers a means of subsistence livelihood, also caused land fragmentation and lack of capital investment, since commonly held land could not be used as collateral. Additionally, only 12% of Mexico’s land area is arable, of which less than 3% is irrigated, which coupled with a general lack of economic opportunity in rural areas, have made it difficult to raise the productivity and living standards of Mexico's subsistence farmers.

Agriculture accounted for 4% of GDP in 2002, yet agricultural employment accounted for over 20% of total employment. However, there are signs that Mexican farmers have already begun to transition away from agriculture to off-farm employment. The number of land owning farmers dropped 21% between 1991 and 2000 and Mexico’s smallest farmers now earn less than a third of their income from agriculture.

Poor availability of credit continues to plague agriculture. Agricultural loans were hard hit by the 1994 peso crisis and many private banks view agricultural lending, particularly to smaller producers, as too risky. Mexico has recently reformed its public lending system, creating Financiera Rural, a public bank with the objective of improving the supply of agricultural credit.

In an effort to raise rural productivity and living standards, Article 27 of the Mexican Constitution was amended in 1992 to allow for the transfer of communal land to the farmers cultivating it. They then could rent or sell the land, opening the way for larger farms and economies of scale. Actual sales of communal land have been few and limited primarily to suburban areas where land values are high. One reason for the lack of sales may be insufficient community support, as some in the community have a vested interest in maintaining the communal land system.

Mexico subsidizes agricultural production through the PROCAMPO program. Since the early 1990s, the availability of program payments has shifted from primarily grains and legumes to all commodities, provided a farmer was producing during a certain base period. Total program funding is $1.3 billion, and 2004 payments were $85 per hectare for producers with more than five hectares and $100 per hectare for producers with 1-5 hectares.

Manufacturing and Foreign Investment
Manufacturing accounts for about 20.3% of GDP and grew by 9.4% in 2000. Manufacturing probably fell or was stagnant in 2001 because exports to the U.S. probably fell. Construction grew by almost 7% in 2000 but was probably stagnant in 2001.

According to Mexico's Ministry of Economy, foreign direct investment (FDI) in Mexico for 2003 was $10.38 billion, down 29% from the year before. The U.S. was once again the largest foreign investor in Mexico, with $5.75 billion in investments, or 55% of total FDI. The most recent numbers released by Mexico show FDI for January thru June 2004 at $9.57 billion. Although the amount was nearly equal to all of 2003, the total was inflated by an investment of over $4.0 billion by the Spanish bank BBVA.

Oil and Gas
In 2003 Mexico was the world’s fifth-largest oil producer, its ninth-largest oil exporter, and the third-largest supplier of oil to the United States. Oil and gas revenues provide about one-third of all Mexican Government revenues.

Mexico’s state-owned oil company, Pemex, holds a constitutionally established monopoly for the exploration, production, transportation, and marketing of the nation’s oil. Since 1995, private investment in natural gas transportation, distribution, and storage has been permitted, but Pemex remains in sole control of natural gas exploration and production. Despite substantial reserves, Mexico is a net natural gas importer.

Transportation and Communications
Mexico’s land transportation network is one of the most extensive in Latin America with 117,000 kilometers (km.) of paved roads, including more than 10,000 kilometers of four-lane paved roads. The 26,622 kilometers (16,268 mi.) of government-owned railroads in Mexico have been privatized through the sale of 50-year operating concessions.

Mexico’s ports have experienced a boom in investment and traffic following a 1993 law that privatized the port system. Mexico’s ports moved nearly 1.7 million containers in 2003. A number of international airlines serve Mexico, with direct or connecting flights from most major cities in the United States, Canada, Europe, Japan, and Latin America. Most Mexican regional capitals and resorts have direct air services to Mexico City or the United States. The Government of Mexico continues to try to privatize the two main national airlines, Mexicana and Aeromexico, but with little success. Airports are semi-privatized with the government still the majority shareholder, but with each regional airport group maintaining operational autonomy.

The telecommunications sector is dominated by Telmex, the former state-owned monopoly. Several international companies compete in the sector with limited success. Mexico’s telecommunications regulator has failed to enforce dominant carrier regulations, with regulation largely provided through a series of private agreements among the three largest carriers. This has negative implications for U.S. investors in the sector, although there are no reported barriers to exports of U.S. telecommunications goods and services. The teledensity rate in Mexico (around 16%) is among the lowest in Latin America. Cellular penetration is much higher with over 33 million cellular customers in 2004. However, 31 million of these customers use pre-paid cards, and many use their phones to receive calls only. Mexico’s satellite service sector was opened to competition, including limited foreign direct investment, in 2001.

NATIONAL SECURITY
Mexico’s armed forces number about 225,000. The army makes up about three-fourths of that total. The navy is a completely autonomous cabinet agency and as such there is no joint chief of staff position. Principal military roles include national defense, narcotics control, and civic action assignments such as search and rescue and disaster relief.