poverty & inequality in mexico

8/10/2019 Poverty & Inequality in Mexico

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POVERTY &INEQUALITY

IN MEXICO


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Background

Full name: United Mexican States

Population: 120.8 million (2012)

Capital: Mexico City

Life expectancy: 75 years (men), 80 years(women) (UN)

Monetary unit: 1 peso = 100 centavos

GNI per capita:US $9,240 (World Bank, 2011)

GDP (current US$): $1.178 trillion (2012) Income level: Upper middle income


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Causes of Poverty and Inequality

Individual conditions

Insufficient Infrastructure

Government Policies

Politics


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Individual Conditions

Lack of Unavailability of Education:government efforts to accommodate thegrowing student population, improving the quality of instruction and promoting prevalent school

attendance has not been adequate and therefore education has not remained a main priority for families

who must struggle with poverty. 700,000 students, from grade 1-9 dropped out of school in 2009 in all of

Mexico.

Unemployment: the lack of a serious employment policy means that economic expansion issacrificed so that higher prices can be avoided. That exerts a negative impact on the labor market in both

the short and medium term, and on new professionals most of all.

Other Challenges: The government does not activelyencourage opportunities to all citizens; including reducingdiscrimination against middle-age and elder citizens. Over a

million of the unemployed face age discrimination and 55% of all

unemployed face some form of discrimination when seeking

employment


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Insufficient Infrastructure

Investment in infrastructure is unequally distributed

The government is not making efforts for investing in the

betterment of infrastructure

Geographic reasons play an important role in the distribution

of infrastructure

Distributed infrastructure hence 75 percent of the indigenous

population lives on moderate poverty line and 39 percent of

these under extreme poverty


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Government Policies

Inequitable distribution of income: 42.2% wealth unevenly divided amongst the 10percent of nations wealthiest people. despite of government efforts, the NAFTA agreement and

globalization, the income gap remains.

Obsolete Regulatory Framework: disagreement over the years in the government hascaused a serious backwardness in needed legislation in a number of areas. The current economic

framework needs adjustment on virtually all levels including business development opportunities, fair

competition, tax collection and tax law; commerce, trade and finance regulations.

Absent Competitive System: Mexican economy does not support unprivilegedbusinesses, considering its current standards regarding monopolies, both in the public and private sectorshence clear principles of competitiveness that offer incentives to private investment, both national and

foreign, are needed in order for jobs to be created.


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Politics Institutionalized Government described as authoritarian, semi-

democracy, centralized government, untouchable presidencies, mass-

controlling, corporatist and elite-controlled.

Foreign Trade Policies and Foreign Dependence

Government Efforts and Economic Policies Cancununequal distribution of wealthnotorious economical

inequality between the touristic urban zones, and its more rural

outskirts

Transparency and Corruption Corruption Perception Index 2010: Mexico received a low score of 3.1,

on a scale of 0 to 10

A family on average pays 109.50 pesos as bribes to authorities;

households have also reported paying up to 6.9 percent of their

income as bribes.


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Governments Role in Eradicating

Opening Factories: President Felipe Calderon inaugurated two new Safran groupfactories in Queretaro, central Mexico. Officials said the factories represent an investment of

$160 million and would create about 500 jobs (2010).

Foreign Aid: aid from IFAD (International Fund for Agricultural Development) tomitigate the poverty.

IFAD has funded around 9 projects, financed USD 178.1 million and has directly

benefitted 130,405 households.

Their successfully completed programs include:

1. Development of Marginal Rural Communities in Ixtlera (14,500 household)

2. Oaxaca Rural Development campaign (15,000 household)

3.Rural development in the indigenous community of Puebla (17,000 household)


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ON GOING

PROJECTS


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poverty & inequality in mexico

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