Mexico - Industry

Mexico Industry 1199
Photo by: j.o.photodesign

Mexico has one of the best-developed manufacturing sectors in Latin America. In the 1980s, the Mexican government retreated from its position of dominance over the economy, and the private sector was given an expanded role. Manufacturing output increased on average by 2.3% per year during the 1980s and by3.9% annually during 1988–98. In 1998, manufacturing contributed an estimated 22.1% to GDP, and had a growth rate of 7.4%. In 2001, industry as a whole accounted for 26% of GDP. Major industrial centers are Mexico City, Guadelajara, Monterrey, Ciduad Juarez, and Tijuana.

The principal manufacturing industries include food and beverages, tobacco, chemicals, iron and steel, petroleum, textiles, clothing, and motor vehicles. Other industries include footwear, metalworking, furniture, and other wood products. The soft drink industry produces 8 million bottles per year. Mexico's oil refinery capacity was 1.525 million barrels per day in 2002. In 2001, Mexico produced 1.85 million motor vehicles, down 4% from 2000; it produced over 80,000 heavy trucks in 2000, down 15% from 1999. Leading manufacturers are Ford, Chrysler, General Motors, and Volkswagen.

Manufacturing has been focused around the reexport processing industry. These so-called maquiladoras are usually located near the US border and owned by a foreign corporation; they contract to assemble or process imported goods brought in from the US and then reexport them duty free. In 2002, there were some 3,200 maquiladora factories. Baja had the most export industries in 2001, at over 1,300; other leading states included Sonora, and Tijuana, which hosts the majority of electronic-related assembly plants. However, the maquiladora industry was in crisis in 2003, with Mexico losing nearly 600 maquiladoras in 2001–02, mostly in electronics and apparel. During that period, 250,000 jobs were lost, which amounted to 15% of the maquila workforce. China was Mexico's chief rival in the industry. (China's hourly wage is 40 US cents, compared to approximately $1.20 in Mexico, making it hard for Mexico to compete on the world market for reexports.)

The construction sector has great potential, as major improvements in basic infrastructure—including roads, highways, railways, ports, and the airport network—need to be carried out.

User Contributions:

Mallory Grantz
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