Globalization: Mexico exports almost all motor vehicles it produces, but imports new cars

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Jan 082013
 

Which company exports the most motor vehicles in Mexico? In term of units exported, Ford was the leader with 449,925 units. Ford exported over 97% of the vehicles it made in Mexico in 2011. Though Ford sold many new cars in Mexico, virtually all were imports, mainly from the USA or Canada. GM was a relatively close second with 443,237 vehicles exported, 81% of the total produced.

VW was next with 439,925 units exported, 84% of their total. Nissan was fourth with 411,660 vehicles exported which was a significantly lower percentage (68%) of its total production. Nissan sells about a third of its Mexican produced vehicles in Mexico, by far the highest percentage among auto manufacturers in Mexico.

Chrysler/Fiat exported 266,117 vehicles, 79% of their total production. Toyota was next with 49,549 vehicles exported for an amazing 99.9% of the total manufactured. Surprisingly only 47 of the almost 50,000 Toyotas made in Mexico in 2011 were sold in Mexico; all of the rest were exported to the USA or Canada. Virtually all of the thousands of new Toyotas sold in Mexico are imported. This is a very extreme case of globalization at work under NAFTA. Honda exported 36,429 units in 2011 for 80% of its total production.

Data are not yet available to determine which companies will lead in exports in 2012 and the percentage of total production that is exported. Overall production is expected to rise by over 20% in 2012 and perhaps even faster in future years judging by the amount auto companies are currently investing in Mexico. Obviously, production levels in 2013 and beyond will be closely tied to demand in the USA and Canada.

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Which company produces the most motor vehicles in Mexico?

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Dec 292012
 

Back in 2006, General Motors (GM) was the clear leader in production with 493,841 units (just over 25% of the national total). Nissan was second with 411,236 units (21%). These were followed by Volkswagen (VW) – 339,183; Ford – 329,993 and Chrysler – 307,344. The newcomers, Toyota and Honda trailed way behind with 33,835 and 24,297 units, respectively.

By 2011 the picture had changed considerably. All the manufacturers suffered major losses in 2009 as a result of the Great Recession, but all have recovered, some better than others. Between 2006 and 2011, Nissan increased total production by 48%. In 2011, Nissan led all producers with 607,087 units for almost 24% of the national total.

Nissan easily surpassed GM which increased 2006 to 2011 by only 10% for a total of 544,202 units. VW increased by an impressive 50% to 510,041 units. Ford nearly kept pace with an increase of 40% to 462,462 units. Chrysler with merged with Fiat matched GM with an increase of only 10% up to 338,772 vehicles. Toyota upped production by a very significant 47% to 49,596 units. Honda did even better, increasing its production by a whopping 87% to 45,390 units.

Final data are not yet available to determine which companies led production in 2012. Overall production was expected to rise by over 20% in 2012 and perhaps even faster in future years judging by the amount auto companies are currently investing in Mexico. Obviously, production levels in 2013 and beyond will be closely tied to demand which is linked to overall economic growth. Judging from the investment amounts announced so far, it appears that Nissan will retain its lead in total production, with VW and Ford perhaps challenging GM for second place.

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Mexican vehicle exports surge back after 2008-2009 recession

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Dec 202012
 

The Great Recession related to US housing and banking failures in 2009 hit the Mexican vehicle industry very hard. Production in Mexico declined by 28% from 2.10 million units 2008 to 1.51 million units in 2009. This dropped Mexico to 10th in the world. However, production shot up 50% in 2010 to 2.26 million and grew to 2.56 million in 2011 (data from Mexican Automotive Industry Assn.) It is expected to hit 3.1million in 2012. This enabled Mexico to move past Spain and France into 8th place.

Virtually all of this growth has been in the export sector. In 2011, almost 84% of all vehicles made in Mexico were exported. In fact, sales of Mexican made new cars in Mexico dropped from 1.1 million in 2007 to 0.76 million in 2009. It only rebounded to 0.82 million in 2011. It is expected to increase 11% in 2012 to 1.0 million, still lower than the 2007 level.

In 2011, almost 84% of all vehicles made in Mexico were exported. This export percentage clearly suggests that these manufacturers are primarily focused on selling their Mexican made vehicles in the USA and Canada.

Production is expected to continue increasing rapidly in the years ahead as evidenced by the following recent news releases:

Source of data:

Mexican Automotive Industry Assn. “Mexico’s Automotive Production & Exports Hits Record High in November (2012)”  (pdf file)

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Pemex boosts reserves and reduces its emissions

 Mexico's geography in the Press, Updates to Geo-Mexico  Comments Off on Pemex boosts reserves and reduces its emissions
Dec 032012
 

It may come as something of a surprise to many observers, but during 2012, Mexico’s state-owned oil company Pemex (Petróleos Mexicanos) has received several well-deserved plaudits for its efforts to slash the emissions associated with oil and gas exploration, reserves and production.

For the fifth consecutive year, the Global Reporting Initiative awarded Pemex the highest possible rating for social responsibility. The company also received excellent ratings for sustainable asset management. During 2011, Pemex’s proven reserves increased 1.1%, while the petro-giant cut total emissions by 17.3% compared to the previous year. Crude oil output averaged 2.55 million barrels a day in 2011. Carbon dioxide emissions were down 8.8% in 2011, while sulfur oxides have now fallen more than 50% since 2007.

Meanwhile, the production division of Pemex has been praised by World Bank experts for having reduced burn-off from its giant Cantarell gas field from 31% in 2008 to 3% in July 2011. Pemex has invested more than 1.6 billion dollars in the Cantarell field over the last six years in order to improve efficiency, with the installation of compressors, flow separation devices and re-injection technology. In the past three years, it has reduced total emissions, including greenhouse gases, from 13.6 billion cubic meters a year to 2.1 billion. Pemex is well on track to beat its target of 99% efficiency in gas recovery by 2014.

Crude oil production has risen steadily in 2012. For example, in August 2012, Pemex produced 2.56 million barrels of oil a day (b/d), its highest output since May 2011. The Chicontepec field in Veracruz is doing especially well. Its single best-performing well, named Presidente Alemán 1565, uses innovative technology, including three dimensional seismic mapping and horizontal drilling, to yield as much as the combined output of 28 other wells in the region.

Mexico’s current 3P (proven, probable, possible) reserves are also on the rise, and currently total 43 billion barrels of crude oil equivalent. After years of depletion, Pemex is now adding more oil and gas each year to its reserves than it is extracting. The oil giant recently announced a huge deep water, light crude discovery in the Gulf of Mexico, off the coast of Tamaulipas, its first major find in the Perdido Fold Belt, where the total 3P reserves could be as high as 10 billion barrels. The Trión-1 well, drilled to a total depth of 4,500 meters (14,800 feet), is 40 km (25 miles) inside Mexico’s territorial waters and is expected to yield up to 400 million barrels of high quality crude.

Pemex also recently reported the largest land-based discovery of oil for about a decade. The Navegante-1 well, drilled in the South-East Basins 20 km from Villahermosa (Tabasco) found light crude oil with an APR gravity of 45 degrees, at a depth of 6800 meters. The field is 87 square kilometers in area and has estimated 3P reserves of about 300 million barrels of crude oil equivalent.

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La Yesca HEP station officially opened

 Mexico's geography in the Press, Updates to Geo-Mexico  Comments Off on La Yesca HEP station officially opened
Nov 122012
 

The La Yesca dam was officially opened last week by President Calderón. According to the Federal Electricity Commission (CFE), at 208.5 meters (684 feet) high, it is the second highest dam of its kind in the world, 22 meters lower than the dam for the Shibuya hydroelectric plant on the Qingjiang River in China.

The dam is located on the Santiago River, on the border between Nayarit and Jalisco, 105 km NW of Guadalajara (Jalisco) and 23 km NW of the town of Hostotipaquillo (Jalisco). This location is north of the towns of Magdalena and Tequila.

La Yesca dam and reservoir

The reservoir has a total capacity of 2.5 billion cubic meters, of which about half can be used for generating HEP. The surface area of the reservoir is 33.4 square kilometers (13 sq mi).

La Yesca is upstream of two other major HEP dams: El Cajón and Aguamilpa, and represents the latest addition to Mexico’s ambitious plan to increase the proportion of its energy needs coming from renewable sources. La Yesca has a total installed capacity of 750 MW, equivalent to about half the total electricity requirements of Guadalajara, Mexico’s second largest city.

La Yesca dam

The La Yesca HEP scheme represents an investment of about 1.1 billion dollars and was constructed by a consortium led by Mexican firm Ingenieros Civiles Asociados (ICA). Construction began in September 2007. The Santiago River was temporarily diverted in March 2009, and the first generating unit entered service in October 2012. The second unit will enter service this month. The machine house is on the northern side of the river, and the spillway on the southern side.

The three major dams on the River Santiago help to reduce flooding downstream, while also increasing fishing opportunities. According to a CFE study, fish yields from Aguamilpa, the most accessible of the three major dams, have risen from 33.5 metric tons/yr to 5,000 metric tons/yr since the reservoir was completed.

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The Gender Gap in Mexico in 2012

 Updates to Geo-Mexico  2 Responses »
Nov 012012
 

The recently published Gender Gap Report 2012 indicates that Mexico still has considerable work to do, though its gender gap is closing. The report does not reveal much about the quality of life of females in different countries, rather it focuses on the “gap” between females and males. For example, women in Japan have a relatively high quality of life, but the gap between them and Japanese men is very large. Thus Japan ranks 101st out of 135 countries.

The report ranks Mexico 84th out of 135 countries which does not sound so good. However, Mexico has been moving up in the ranks. It was 89th in 2011, 91st in 2010, 98th in 2009, 97th in 2008, and 93rd in 2007. Mexico’s gender gap score improved throughout the five year period.

Notable countries close to Mexico’s ranking, in the group ranked 80 to 90, are Italy (80), Hungary (81), Greece (82), Bangladesh (86) and Chile (87).

The top ten in the list (smallest gender gap) are the five Scandinavian countries, along with Ireland, New Zealand, the Philippines, Nicaragua and Switzerland. Canada and the USA are ranked 21st and 22nd. Among Mexico’s chief competitors, Argentina is 32nd, Russia is 59th, Brazil is 62nd, China is 69th, India is 105th and South Korea is 108th. The very bottom of the list is dominated by Islamic and many Sub-Saharan African countries.

The report indicates that Europe (including Canada and USA) ranked the highest, followed by Latin America (and the Caribbean), Sub-Saharan Africa, Asia and Pacific, and Middle East and North Africa, a rather distant last. Among 26 Latin American and Caribbean countries, Mexico ranked a relatively low 20th. Clearly, Mexico has a gender gap problem.

The Gender Gap Index is a composite index. It includes four sub-indexes, which are combined to get an overall score which is used to rank countries:

  • economic participation and opportunity
  • educational attainment
  • health and survival
  • political empowerment

In health and survival Mexico ranks a rather surprising 1st tied with 31 other countries. This means that Mexican females are unsurpassed with respect to sex ratio at birth (female/male) combined with female life expectancy (female/male). This is quite impressive. Perhaps males getting killed in drug and other violent activities helps Mexico’s score on this sub-index. Not surprisingly, China ranked 132nd and India at 134th are right near the very bottom.

On the down side, Mexico is ranked 113th in female economic participation and opportunity, though it has improved significantly. This index covers wage equality as well as proportion of female legislators, senior officials and managers, as well as professional and technical workers. Grouped near Mexico are Chile (110th), El Salvador (112th), Guatemala (114th), and South Korea (116th). Perhaps most telling is that female workers only earn 45% of what males do performing similar work. The percentages are worse in some other countries: Korea (44%), Indonesia (42%), Turkey (30%), India (27%), Pakistan (21%) and Saudi Arabia (17%). Less than a third (31%) of Mexican legislators, senior officials and managers are female, compared to 59% in Jamaica, 43% in the USA, 36% in Canada and Brazil, 23% in Argentina and only 10% in Bangladesh, Turkey and South Korea.

In the educational attainment sub-index Mexico ranks 69th. Its index score was just a fraction higher in 2007, when Mexico was ranked 49th. The report indicates that 98% of appropriately-aged females and 98% of males are enrolled in primary school. It shows that 73% of Mexican females are enrolled in secondary school compared to 70% of males. At the tertiary (college) level the percentage is 28% for both genders. These data seem very impressive, but in many other countries there are far more females enrolled than males; for example, in Uruguay the reports says that females lead male enrollments at the tertiary level by 81% to 47%. Despite Mexico’s rank of 69th, Mexico’s so-called gender gap in education does not appear to be a major concern.

Mexico’s political empowerment score improved significantly since 2011 and its rank went from 63rd to 48th apparently because the number of females in ministerial level positions went from 11% up to 21%. Relatively near Mexico are Canada ranked 38th, Australia (42nd), Colombia (51th), Pakistan 52nd),  Israel (54th), USA (55th) and China (58th). We imagine that the rankings of Canada, Australia, Pakistan and Israel were greatly helped because they have all had a female head of state in the last fifty years.

In conclusion, Mexico is making solid progress in closing its gender gap, but there is still plenty of work to be done.

Mexico’s growing industrial might

 Mexico's geography in the Press, Updates to Geo-Mexico  6 Responses »
Sep 292012
 

Industrial exports from Mexico are growing rapidly and diversifying. Some of this growth is coming at the expense of China and other Asian countries. For example, as Adam Thompson reported in the Financial Times, Siemens of Germany recently moved its facilities for assembling high voltage electrical equipment for power substations from China and India to Querétero, Mexico. By next year, most of the 160 parts for this equipment will also be produced in Mexico. Siemens has eight other factories in Mexico and over 6,000 employees. As a result of investments like this, Mexico now exports more manufactured products than the rest of Latin America combined.

It is well known that the USA imports a great deal of manufactured goods from China including toys, electronics, clothing, shoes, etc. But China’s market share of US imports has declined recently, from 29.3% in 2009 to 26.4% to day. On the other hand, Mexico’s market share has increased from 11.0% in 2005 to 14.2%. According to The Economist, “HSBC reckons that by 2018 Mexico will overtake Canada and China to become America’s main source of imports”.

Mexico’s location next to the giant US consumer market is a big factor (see “US firms are near-shoring jobs from China to Mexico”.

It is much faster and cheaper to ship goods from Mexico to the USA rather than from Asia. For example, it usually takes two to seven days from Mexico versus 20 to 60 days from China. Mexico’s locational advantage is particularly important for trendy time-sensitive goods and bulky items. For example, in 2009 Mexico became the world’s leading exporter of flat-screen TVs, surpassing South Korea and China. Mexico is also the leading supplier of smartphones for the US market. Furthermore, as Itizar Gomez Jimenez reports in “Beyond the Refrigerator Door: Success of the Electric Home Appliance industry in Mexico”, most of the large household appliances sold in the USA come from Mexico, including refrigerators, kitchen ranges, dishwashers, microwave ovens, washers and dryers.

Attractive wage rates in Mexico are also a consideration. A decade ago wages in Mexico were roughly four times those in China, but now they are only about 30% higher and the gap is closing (see, “Rising Chinese labor costs: good news for Mexico”). Less red tape under NAFTA also gives Mexico an advantage (see, “Can Mexico’s industry compete with China?”). Mexico is fully committed to globalization. It has free trade agreements with 44 other countries, twice as many as China and four times as many as Brazil. To date, drug war violence has not been a serious constraint to Mexico’s growing manufactured exports.

logo-made-in-mexicoMexico’s maquiladora export industries used to assemble mostly imported parts into finished products for export to the USA. Now, most of the parts are manufactured in Mexico for such industries as electronics, automobiles, appliances and airplanes. (see: “Mexico’s vibrant autoparts sector” and “The reasons why Mexico is fast becoming a key player in aerospace manufacturing). Mexico is also broadening its export market. In 2000, about 90% of Mexico’s exports went to the USA, but now it is down to 80%. Mexico is even exporting manufactured items to China such as the new Chrysler Fiat-500 micro automobile.

While Mexico manufactures products under the names of many foreign brands, it also has its own brands and OEM (original equipment manufacturer) companies that design and build products that are incorporated into foreign branded products. For example, Mexico’s Mabe designs and builds two-thirds of the gas ranges and refrigerators imported into the USA. Furthermore, most of the appliances sold under the General Electric brand in North and South America are manufactured by Mabe. LANIX, Mexico’s largest domestic electronics company, makes desktops, laptops, netbooks, tablets, LCD and LED TV and monitors and smartphones for a range of brand names.

A careful look around a typical household in the USA would reveal that many, perhaps a majority, of the durable manufactured goods would carry a “Made in Mexico” label, including automobiles, flat panel TVs, smartphones, all types of appliances, garden and small power tools, etc. etc.

Sources:

  • Adam Thomson, “Mexico: China’s unlikely challenger.” The Financial Times, September 19, 2012 (registration required).
  • Itizar Gomez Jimenez, “Beyond the Refrigerator Door: Success of the Electric Home Appliance industry in Mexico” (pdf file). Cover Feature: Domestic Consume.

Related posts (specific industries):

Mexico’s three latest Magic Towns (#55, 56, 57) include Loreto, former capital of the Californias

 Updates to Geo-Mexico  Comments Off on Mexico’s three latest Magic Towns (#55, 56, 57) include Loreto, former capital of the Californias
Sep 272012
 

It is getting just as hard to keep up with Mexico’s Magic Towns program as it is to understand why some of the places deserve to be included on the list. Since our last post about Magic Towns, three more places have been added:

#55 Loreto (Baja California Sur)

The attractive town of Loreto [ed: deservedly on the list], is built on the coast around a centuries-old mission. The town has a full range of tourist services, from expensive and ultra-luxurious to budget.

The first colonial Jesuit mission in this region was at San Bruno, 25 kilometers north of Loreto; it was founded in 1683, but lasted only two years. In February 1697, the Spanish Viceroy granted Jesuit priests Juan María de Salvatierra and Eusebio Francisco Kino permission to go to the “California Province“. This is apparently the earliest recorded mention of California as a geographic entity.

The Loreto mission, founded later that year, became extremely successful. Jesuit priests set out from Loreto to found missions throughout the Baja California Peninsula, most of them established by about 1720. Loreto was sufficiently important to function as the capital of the Californias (including the present-day U.S. state) until 1777.

#56 Valladolid (Yucatán)

Valladolid, located about half-way between Mérida and Cancún, is well worthy of Magic Town status. Founded in 1543, it is an attractive colonial city, with wide streets and considerable historical importance. The city has become increasingly popular among discerning tourists in recent years.

There are many attractions, including the numerous superb colonial buildings, such as the Cathedral in the center, and the Franciscan mission of San Bernardino de Siena, in the Sisal district of the city. The local Maya people, in traditional attire, bustle about the central square as they carry out their daily tasks. Valladolid is small enough to explore on foot, by strolling through the different districts of the city.

Coupled with excellent traditional Yucatecan cuisine, natural wonders like Cenote Zaci (a landscaped limestone sinkhole or cenote), pastel-colored walls, friendly handicraft stores, and historical murals in the government palace, what more could a visitor want?

#57 Metepec (State of México)

Metepec is a somewhat nondescript city of 160,000, located near the state capital of Toluca. The earliest Spanish settlers arrived in 1526. Metepec has numerous historic religious buildings, including the Ex-convento de San Juan and the Parish Church of San Mateo. The city’s major claim to fame in terms of handicrafts are ceramic “trees of life” and similar objects. Since 1990, the city has celebrated an annual international arts and culture festival, Quimera, every October.

This map from the Tourism Secretariat (Sectur) shows Mexico’s 57 Magic Towns (as of September 2012):

Map of Mexico's 57 Magic Towns (September 2012). Credit: Sectur

Map of Mexico’s 57 Magic Towns (September 2012). Credit: Sectur

How many more Magic Towns will there be? Will the program continue after the new President takes office later this year? Watch this space!

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How many oil refineries does Pemex have?

 Mexico's geography in the Press, Updates to Geo-Mexico  Comments Off on How many oil refineries does Pemex have?
Sep 222012
 

If many of the press reports about the tragic events that led to the death of 29 Pemex workers in Reynosa (Tamaulipas) are to be believed, the problem was an explosion in a Pemex oil refinery. There is just one small “detail” in these statements: there is no Pemex oil refinery in or near Reynosa!

The accident occurred during maintenance at a gas pipeline distribution center, which is a very different industrial installation to an oil refinery.

For the record, Pemex currently has six oil refineries in Mexico, shown on the map below, and listed here by their 2007 production in barrels/day (b/d):

  • Tula Refinery, Hidalgo (289,000 b/d)
  • Salina Cruz Refinery, Oaxaca (272,000 b/d)
  • Cadereyta Refinery, Nuevo León (217,000 b/d)
  • Salamanca Refinery, Guanajuato (188,000 b/d)
  • Minatitlan Refinery, Veracruz  (170,000 b/d)
  • Ciudad Madero Refinery,  Tamaulipas (141,000 b/d)
Pemex installations in Mexico. (Adapted from Fig 15.5 of Geo-Mexico). All rights reserved.

Pemex installations in Mexico (adapted from Fig 15.5 of Geo-Mexico). All rights reserved.

The six Pemex refineries produce liquid gas, gasoline, diesel, kerosene and other fuels. The state oil giant is expanding its refining capacity by building a second oil refinery, Refinería Bicentenario, in Tula (Hidalgo). Expected to cost around 10 billion dollars in total, it will have the capacity to process 300,000 barrels of crude a day and is expected to be operational sometime in 2016.

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Rapid growth in Mexico’s vehicle manufacturing and assembly sector

 Updates to Geo-Mexico  1 Response »
Sep 202012
 

Mexico is rapidly becoming a world leader in vehicle production, which includes cars, commercial vehicles such as large trucks, pick-ups and SUVs (sports utility vehicles). Back in 1995, Mexico produced fewer than a million vehicles and ranked 12th globally. By 2011 it was making 2.68 million, placing it 8th in the world (see table). During the 16 year period, Mexico surpassed France, Canada, the U.K., Russia, Italy and Spain. China and India moved ahead of Mexico during the period.

Mexico’s impressive 1995 to 2011 growth of 185% was third among top vehicle producers, but trailed way behind the amazing growth of China at 1170% and India at 515%. Others experiencing significant growth include Brazil up 109%, Russia up 101%, South Korea up 84% and Germany up 35%. Except for Spain, which edged up less than 1%, all the other other major vehicle producers experienced significant declines in the number of vehicles produced: USA (- 28%), Japan (-18%), U.K. (-17%), France (-15%) and Canada (-12%). The data clearly indicate that vehicle production is shifting rather quickly from the major producers of past decades to a number of emerging economies with lower labor costs. Germany appears to be the only exception to this shift. In North America, production has shifted from the USA and Canada to Mexico, largely as a result of NAFTA.

2011 Production Statistics (Source: International Organization of Motor Vehicle Manufacturers)

Country Cars Commercial vehicles
 Total Change from 2010
(millions of vehicles)
China 14.5 3.9 18.4 0.8%
USA 3.0 5.7 8.7 11.5%
Japan 7.2 1.2 8.4 –12.8%
Germany 5.9 0.4 6.3 6.9%
South Korea 4.2 0.4 4.7 9.0%
India 3.0 0.9 3.9 10.4%
Brazil 2.5 0.9 3.4 0.7%
MEXICO 1.7 1.0 2.7 14.4%
Spain 1.8 0.5 2.4 –1.4%
France 1.9 0.4 2.3 2.9%
Canada 1.0 1.1 2.1 3.2%
Russia 1.7 0.2 2.0 41.7%
TOTAL 59.9 20.2 80.1 3.1%

 

Mexico vehicle production grew by over 14% from 2010 to 2011, the fastest among all major producers except Russia, which advanced at a very impressive 42% (see table). Available data indicate that Mexico’s rapid growth has continued into 2012. Interestingly, the USA’s growth of 12% over its lackluster 2010 total placed it 3rd, ahead of India (10%), South Korea (9%) and Germany (7%). Surprisingly, Brazil and China grew by less than 1%, though China’s 2011 production level of over 18 million vehicles was over twice as many as its nearest rivals, the USA and Japan.

Just looking at commercial vehicles, which include pick-ups and SUVs, Mexico ranks a very impressive 5th in the world with over a million vehicles, behind only the USA, China, Japan and Canada. On this list, Germany and South Korea drop back to 11th and 12th behind Thailand, India, Brazil, Turkey and Spain.

Source of data:

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Protecting Mexico’s endangered marine turtles

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Sep 062012
 

Mexico is home to six of the world’s seven species of marine turtles, all of which are on the international Red List of endangered or critically endangered species.

The beaches along Mexico’s Pacific coast, those in the north-east state of Tamaulipas, and those in Quintana Roo on the Caribbean, are among the world’s most important breeding grounds for marine turtles. These turtles spend almost all their life at sea, but mature females come ashore in late summer and fall to burrow into the warm sand and lay their eggs.

On the Pacific coast, it is estimated that about 40% of these eggs will be stolen by wildlife poachers. When the remaining eggs eventually hatch six to eight weeks later, the baby turtles then stagger towards the relative safety of the ocean, hoping to avoid not only human poachers, but also predators such as crabs, iguanas and birds. Less than one in one hundred hatchlings will survive the fifteen or twenty years required to reach maturity.

The three turtle species most commonly found along the Pacific coast are the Olive Ridley or golfina (Lepidochelys olivacea), the Leatherback or laúd (Dermochelys coriacea) and the Green Turtle or tortuga verde (Chelonia mydas).

The Olive Ridley is relatively small in size with a narrow head. Its numbers are now recovering on the Nayarit and Jalisco coasts. Important nesting sites for the Olive Ridley include Caleta de Campos and Ixtapilla (both in Michoacán), and Playa de Escobilla and Morro Ayuta (both in Oaxaca). About 23.3 million baby turtles were born in the 1.2 million Olive Ridley nests recorded in the 2010-2011 turtle nesting season.

Leatherbacks, the world’s largest turtles, undergo amazing migrations, regularly crossing from one side of the Pacific to the other. Their numbers are in serious decliine. In 2010-2011, 15,400 baby Leatherbacks emerged from the 615 nests recorded. (Mexico is thought to have about 1,600 Leatherback nests in total.) Important nesting sites include beaches in Guerrero, Michoacán and Oaxaca. However, in the last-named state, the number of eggs laid has declined by about 20% a year over the last decade.

Selected marine turtle nesting beaches in Mexico.

Selected marine turtle nesting beaches in Mexico. Copyright 2012 Geo-Mexico; all rights reserved.

Green Turtles are an endemic species and their preferred nesting sites include Colola in Michaocán.

The three remaining species are the Kemp’s Ridley or lora (Lepidochelys kempii), the Loggerhead or caguama (Caretta caretta) and the Hawksbill or carey (Eretmochelys imbricata).

The Kemp’s Ridley is an endemic species and the only marine turtle to nest exclusively during daytime. Its most important nesting site is Rancho Nuevo, in Tamaulipas. While the numbers of Kemp’s Ridley at Rancho Nuevo fell from an estimated 40,000 or so in 1947 to about 5,000, this species appears to be well on its way to recovery. In 2010-2011, 20,574 Kemp’s Ridley nests were laid in Tamaulipas and an additional 534 in Veracruz, which produced a combined 18.9 million hatchlings.

The Loggerhead is found on both sides of Mexico, while the Hawksbill, smaller than the other species, is most common on Mexico’s Caribbean coast, though it can also be found, much more rarely, on the Gulf and Pacific coasts.

Mexico’s first turtle management program was launched in 1962. In 1990, the government enacted a total ban on the trafficking of all turtles, turtle products and byproducts. Even so, illegal poaching  (for meat, eggs or shell) continues to be a problem, especially since successful convictions relating to the capture or trafficking of turtles are rare. It is still possible to buy baby turtles (for pets) and turtle eggs (thought to be an aphrodisiac) on the black market.

The most successful strategy to date has been the establishment (since the early 1970s) of turtle protection camps on key beaches. During the egg-laying and hatching season conservation groups led by biologists, with the assistance of volunteers, local fishermen and Mexican navy personnel, guard the nesting sites, sometimes moving nests to better protected areas. This strategy has definitely been successful. For example, over the past few years, the conservation group patrolling San Francisco beach has seen the number of active Olive Ridley nests increase tenfold to 700. However, not all beaches can be protected. In Jalisco, for example, only about 80 km of the state’s 200 km of sandy shores are closely monitored.

Protection efforts at 33 nesting beaches are overseen by the National Commission on Natural Protected Areas (Conanp). Of these 33 beaches, 10 are natural protected areas, 3 are in biosphere reserves and 15 are internationally-designated Ramsar wetlands; the remaining 5 have no formal protection status.

Besides the threat from wildlife poachers and predators, marine turtles face numerous other long-term threats, including:

  • habitat destruction, when beaches are cleared for tourist development
  • the installation of coastal infrastructure, designed to prevent erosion, which may limit turtle access to beaches
  • hurricane damage destroying nests
  • the accidental bycatch of turtles by commercial fishermen
  • artificial lighting which may disorientate hatchlings who head towards the light assuming it is reflected off the ocean
  • ocean contamination by items as mundane as plastic bags, which may be mistaken for jelly fish, a favorite food of Leatherbacks

Further reading (Spanish language):

  • Programa de acción para la conservación de la especie Tortuga Laúd (Dermochelys coriacea)
  • Programa de Monitoreo de la Tortuga Golfina (Lepidochelys olivacea) en el Parque Nacional Lagunas de Chacahua

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Mexico’s beer industry loses its national identity

 Updates to Geo-Mexico  Comments Off on Mexico’s beer industry loses its national identity
Aug 112012
 

The beer industry in Mexico is dominated by two major players: Grupo Modelo and Cuauhtémoc-Moctezuma, the brewing division of Femsa  (Fomento Económico Mexicano).

In 2011, Mexico’s breweries produced 79 million hectoliters of beer, of which Grupo Modelo was responsible for 59%, and Cuauhtémoc-Moctezuma about 25%. Between 1991 and 2011, production had almost doubled, increasing by 92.6%. The record year was 2008, when 82 million hectoliters were produced.

The map shows the locations of the major breweries belonging to Grupo Modelo and Cuauhtémoc-Moctezuma (Femsa), as of mid-2012.

The location of Femsa and Modelo breweries in Mexico

The location and inauguration dates of Femsa and Modelo breweries in Mexico

Grupo Modelo produces 13 brands, including Corona, Modelo Especial, Negra Modelo, Pacífico, Victoria, Estrellita and León. Its international sales rose 4.7% in 2011 to about $2.8 billion. Its best selling brand abroad is Corona Extra, the leading Mexican beer in the USA, while its Modelo Especial brand is that country’s third most popular brand. Corona is the leading import brand in some 40 countries, including Australia and Canada. Grupo Modelo (2011 net sales $6.5 billion) has a presence in about 180 countries.

Cuauhtémoc-Moctezuma produces 21 brands, including Tecate, Carta Blanca, Superior, Sol, Indio, Bohemia, Dos Equis and Noche Buena. It sells to 50 countries. The division represents 23.5% of the total revenues of parent company Femsa (Fomento Económico Mexicano).

Several things have changed since our two previous major posts about beer:

First, beer consumption has been rising. The average consumption in 1994 was 49.6 liters/person/yr. This figure had risen to 61 liters by 2000 and to about 70 liters by 2008. Part of this increase is due to the fact that the average age of the Mexican population has been steadily rising for several decades. See, for example, Is Mexico experiencing a demographic dividend? A 2005 report from the national beer industry claimed that the average annual consumption of beer in Mexico was 50 liters per adult

The most significant changes in the beer industry are in ownership. In 2010, Dutch brewer Heineken bought 100% of the shares of Cuauhtémoc-Moctezuma, Mexico’s oldest brewer, created in 1890.

Now, it has been announced that Grupo Modelo, founded in 1925, is being bought by Belgian-US brewing company Anheuser-Busch InBev. Anheuser-Busch InBev previously held a non-controlling 50% in Modelo, and is buying the remaining 50% for $20.1 billion. This deal should be finalized in the first quarter of 2013. When completed, it means that virtually all of Mexico’s beer, bar a few small specialist breweries and microbrews, will be in the hands of European firms. Microbreweries include Pepe’s y Joe’s in Mazatlán; Cervecería San Ángel and Cervecería Santa Fe Beer Factory, both in Mexico City; and the Beer Lounge, in Guadalajara.

Both major beer-makers in foreign ownership? Another small but important part of Mexico’s national identity will have been lost…

 

How well is tourism doing this year in Mexico?

 Updates to Geo-Mexico  Comments Off on How well is tourism doing this year in Mexico?
Jul 142012
 

One way of looking at the spatial pattern of how well tourism is doing is to examine hotel occupancy rates. Mexico’s Tourism Secretariat regularly publishes data for 70 tourist destinations across the country, ranging from major vacation resorts to cities where business-tourism is more important. Hotel occupancy rates have risen steadily in Mexico for 14 consecutive months, with a 6.3% increase year-on-year for the period January-May.

Some destinations are doing better than others.  Occupancy in the Riviera Maya, Cancún and Puerto Vallarta rose by 3.1%, 8.7% and 10.6% respectively, compared to 5.6% in Huatulco (Oaxaca), 8.5% in La Paz and 8.1% in Loreto (both in Baja California Sur).

The increase in large cities (Mexico City, Guadalajara, Monterrey) was smaller than average, while occupancy rates for four mid-sized interior cities rose much faster than average: 23.8% in Querétaro, 32% in Zacatecas, 35% in Aguascalientes and 37% in Guanajuato.

The increase in occupancy rates for other destinations for the period Jan-May included:

  • Puebla 15.1%
  • Oaxaca 8.0%
  • Mérida 6.3%
  • León 1%
  • Tijuana 6.6%
  • San Luis Potosí 16.9%
  • Morelia 10.1%
  • Villahermosa 33.1%
  • San Cristóbal de las Casas 12.2%.
  • Xalapa 8.9%

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Mexico’s north-south political divide persists, albeit with minor changes

 Updates to Geo-Mexico  1 Response »
Jul 122012
 

An earlier post discussed the north-south divide apparent in the 2006 presidential election. That year Felipe Calderón of PAN got the most votes in 14 of 17 northern states (blue on the map), while in 13 of 15 southern states Andrés López Obrador of PRD (green) got the most votes. Roberto Madrazo of PRI (pink) did not get the most votes in a single state.

Voting patterns in presidential elections, 2006 and 2012

Voting patterns in presidential elections, 2006 and 2012. All rights reserved.

The voting pattern changed considerably in the 2012 presidential election, but a north-south pattern still emerged. What was somewhat similar in both elections is that López Obrador of PRD retained much of his strength in southern Mexico. In both elections, PRD got most votes in seven southern states: Federal District, Morelos, Tlaxcala, Guerrero, Oaxaca, Tabasco and Quintana Roo. In 2012 PRD won in one other state, Puebla, which favored PAN in the 2006 election. Six southern states switched from PRD to PRI:  Michoacán, México, Hidalgo, Veracruz, Chiapas and Campeche. Puebla switched from PAN to PRD, while Yucatán went from PAN to PRI.

In the north, the pattern changed completely with the PRI replacing PAN as the highest presidential vote-getter. A total of 11 northern states switched from PAN to PRI: Baja California, Sonora, Chihuahua, Coahuila, Sinaloa, Durango, Aguascalientes, San Luis Potosí, Jalisco, Colima and Querétaro. In 10 of these states PAN came second while PRD took second place in Baja California. In 2012 PAN got most votes in only three states–Nuevo León, Tamaulipas and Guanajuato–compared to 16 in 2006.

PRD appears to have lost much of its relatively weak following in northern Mexico. The three northern states PRD won in 2006 all switched to PRI: Baja California Sur, Nayarit and Zacatecas. In 2012, PRD could only manage second place finishes in three states: Baja California, Nayarit and Zacatecas.

While the north-south pattern is still somewhat apparent, the main pattern of the 2012 presidential election is a strong victory for PRI candidate Enrique Pena Nieto. PRI was victorious in 22 of 32 states and came in second in the other ten.

However, PRI fell just short of controlling Mexico’s Congress so it will need support from some other parties to pass needed legislation and reforms. Together with minority coalition partner PVEM (Mexico’s Green Party), PRI won 240 of the 500 seats in the Chamber of Deputies and 62 of the 128 seats in the Senate. On the other hand, PRI has recently indicated support for many reforms similar to those previously proposed by PAN. This implies that needed reforms may have a decent chance of passing.

Further reading, with state by state analysis:

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Have Mexicans given up on the dream of moving to the USA?

 Updates to Geo-Mexico  Comments Off on Have Mexicans given up on the dream of moving to the USA?
Jul 092012
 

A recent post noted that net migration from Mexico to the USA has dropped to essentially zero. Does this mean that Mexicans no longer have any interest in moving to the USA? The answer to this question is complicated. Obviously, many Mexicans living in Mexico would like to join their family members in the USA if it were legally possible. Others might feel that their career ambitions or the aspirations of their children might be better served by living in the USA. On the other hand, many Mexicans in the USA might feel that their lives would be better if they lived in Mexico.

A face-to-face survey in April 2012 by the Pew Research Center of 1,200 Mexicans in Mexico sheds light on this issue. According to the survey, 56% had a favorable view of the USA, compared to 52% in 2011. Only 34% had an unfavorable view of the USA, down from 41% in 2011. The views varied significantly by age and education. Sixty percent of 18 to 29-year-olds had a positive view compared to only half of those over age 50. Fully 66% of those with a post-secondary education had a favorable view compared to less than half (48%) of those with less education.

Over half (53%) think that Mexicans who move to the USA have a better life, up sharply from 44% in 2011. This suggests that there is still considerable interest in migration. Only 14% indicated they had a worse life, down from 22% a year earlier. However, 61% said they would not move to the USA if they had the means and opportunity. On the other hand, 37% said they would move to the USA and of these 19% indicated they would move even without legal documentation. Not surprisingly, younger Mexicans and those with more education were more interested in moving to the USA.

The survey data indicate that when/if US unemployment declines and there are again ample job opportunities in the USA, many Mexicans may migrate legally or illegally to fill those jobs. Of course, employment opportunities in Mexico will be a very important factor affecting decisions about migration. While the Mexican economy has recovered from the severe recession far better than the USA, still 62% of surveyed Mexicans described the economy as “bad”, down from 75% in 2010 and 68% in 2011. But Mexicans remain optimistic, 51% say the economy will improve in the next year compared to 32% who think it will remain the same, and only 16% who believe it will be worse. The Mexicans more willing to migrate, those with higher educations and incomes, are more optimistic about Mexico’s economic future. If the gap between US and Mexican economic opportunities continues to shrink in the decades ahead, we can expect Mexicans to become less interested in moving to the USA.

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Avocado exports have tripled in five years but Mexico’s avocado farmers face a new problem

 Updates to Geo-Mexico  1 Response »
Jun 112012
 

Avocados originated in Mexico and the country remains the world’s leading producer. Farmers in Michoacán (where 92% of Mexico’s avocados are grown) harvested 1.1 million tons of avocados in the 2010-2011 harvest season, 40% of the world total. About 125,000 hectares, or 11.5% of all agricultural land in Michoacán, is currently under avocado orchards.

Avocado-growing states in Mexico.

Avocado-growing states in Mexico

The value of avocado exports has tripled over the past five years. Exports in 2011 totaled almost 400,000 metric tons and were worth 990 million dollars, compared to 338 million dollars in 2006. The main export markets are the USA (80%), Japan (9%) and Canada (6%).

Part of the reason for strong exports is due to an increased demand from US consumers but it is also due to new menus in fast food chains. The addition of avocados in 2010-11 to the menus of Burger King and Subway restaurants has since been followed by competitors such as Wendy’s, so US demand for avocados should continue to grow.

Avocado growing has not been entirely plain sailing in recent years. Growers organizations have reported that costs of the inputs of water, fertilizers and electricity required for avocado growing have all risen sharply.

Avocado growers are also having to confront a relatively new challenge that increases the cost of doing business. According to an article in Mexico City daily La Jornada, growers are now being forced to pay “protection money” to criminal gangs operating in Michoacan’s avocado-growing zone.

The article claims that avocado producers in 13 municipalities in the state of Michoacán face almost daily demands for “protection” payments if they are to continue farming and avoid kidnappings and other forms of violence. It goes on to say that many smaller growers near Uruapan, Zitácuaro and Ziracuarétiro have chosen to rent out or sell their avocado orchards and move away from the area entirely.

In addition, one of the criminal groups is demanding up to $1,000 pesos (75 dollars) a plant for every avocado plant purchased from specialist nurseries. Several different groups are alleged to be involved. Avocado packers and truck drivers are also made to pay “fees” which can amount to between 40% and 60% of their normal income, according to anonymous representatives of national organizations speaking to the press.

The situation affects avocado growers in many places, including Los Reyes, Uruapan, Salvador Escalante, Acuitzio, Tacámbaro, Ario, Teretán, Apatzingán, Tacíntaro, Nuevo Parangaricutiro, Peribán, Tingüindín and Zitácuaro.

At one time, there were as many as 22,000 avocado growers, half of them working only small orchards. The protection rackets have meant that new plantings have become the preserve of a relatively small number of larger farms, and it is currently estimated that the total number of growers has shrunk to around 17,500.

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Remittances are on the rise

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Jun 092012
 

The annual total of remittances sent back to families in Mexico by migrant workers in the USA increased year-on-year to 22.731 billion dollars in 2011, and looks set to rise again this year.

Mexico’s central bank (the Bank of Mexico) recently released figures showing that remittances to Mexico increased in April 2012 by more than 8% compared to the same month a year earlier, bringing the cumulative total for the first four months of this year to 7.4 billion dollars, 6% higher than in the same period in 2011.

These increases in remittance flows come despite increasing evidence that the net flow of migrants leaving Mexico to work in the USA has come to a standstill:  Net migration flow from Mexico to the USA falls close to zero or has possibly reversed.

For more detail about remittances in Mexico, see:

 

Mother and child health in Mexico: how does Mexico compare to the rest of the world?

 Updates to Geo-Mexico  1 Response »
May 102012
 

Linked to Mother’s Day [10 May in Mexico], Save the Children just published their 13th annual report on the“State of the World’s Mothers”.

The report investigates childhood malnutrition and relates it to the well-being of mothers. The focus is on the first 1,000 days from the time of conception to the child’s second birthday. Proper nutrition and health care during these 1,000 days are critically important to brain development and the welfare of the child throughout its lifetime.

Mother and child in a Mexican market

Mother and child in a Mexican market. Photo: Tony Burton.

For decades, development experts have recognized that health, education and economic opportunity of mothers are crucially important to the quality of life of their children. Mothers’ level of education is often the most important factor.

The impacts last for numerous generations. Not only do the children of more educated mothers do better, but their grandchildren and great grandchildren also do better. On the other hand, malnourishment during the first 1,000 days is linked to low education and economic opportunity for the child. It can result in daughters getting pregnant earlier and having less healthy children. This vicious circle can continue for generations.

How does Mexico stack up with other major countries around the world? The results for Mexico are a bit mixed. From 1990 to 2010 Mexico recorded an impressive decrease in malnutrition of 3.1% per year. (The measure of malnutrition used in this comparison was children too short for their age, “stunting”). Mexico has cut malnutrition almost in half (47%) since 1990. This decrease ranks it 11th among the 165 countries analyzed. Much of this progress is associated with Mexico’s Oportunidades Program. The ten countries that did better than Mexico include China (6.3%), Brazil (5.5%), and Vietnam (4.3%). Fifteen countries suffered increases in malnutrition during the 20 year period, including Somalia (6.3%/year), Afghanistan (1.6%/year) and Yemen (1.0%/year).

On the other hand, the study points out that, given its level of Gross Domestic Product (GDP) per capita, Mexico’s level of malnutrition is higher than it should be. Other under-performers include the USA, Singapore, India, Indonesia, Guatemala, Peru, South Africa and Venezuela. These countries tend to have very inequitable distributions of income. Surprisingly, Brazil, with one of the worst levels of income inequality, was among the group of countries with lower malnutrition than expected given their GDP per capita. Other over-performers include Chile, Ukraine, China and Vietnam. Obviously, in all countries malnutrition is much worse among the poor.

The study divides the 165 countries into the three Tiers used by the United Nations. The Tiers are labeled I-“more developed”, II – “less developed” and III – “least developed”. Tier I is limited to Japan and European countries. Mexico is one of 80 countries in Tier II (“less developed” countries).

The UN has a “Women’s Health Index” for Tier II, comprised of lifetime risk of maternal death, percent of women using modern contraception, percent of births attended skilled attendant, and female life expectancy at birth. Within this group, Mexico ranks 19th in “Mother’s (Health) Index” compared to Cuba (ranked 1st), Argentina (4th), Brazil (12th), China (14th), South Africa (33rd), Turkey (47th), Iran (50th), Philippines (52nd), Indonesia (59th), Saudi Arabia (63rd), Egypt (65th), Guatemala (68th), India (76th), Pakistan 78th) and Nigeria (80th).

The differences between ranks appear to overstate the real differences. For example, the scores on the individual variables for Mexico (19th) and Argentina (4th) are relatively close. The chance of maternal birth-related death is one in 500 for Mexico versus 600 in Argentina. In Mexico 95% of births are attended by a trained worker compared to 98% in Argentina. Two thirds (67%) of Mexican women use modern contraception methods compared to 64% in Argentina. Life expectancy for women is 80 years in both countries.

The UN “Children’s Health Index” for Tier II is comprised of under age five mortality rate, percent of children under 5 moderately or severely underweight for age, gross primary enrollment ratio, gross secondary enrollment ratio and percent of population with access to safe drinking water.

Mexico ranks 18th among Tier II countries in terms of “Children’s (Health) Index” compared to Cyprus (1st), South Korea (2nd), Brazil (7th), Argentina (8th), Turkey (10th), Egypt (21st), Iran (26th), China (34th), South Africa (56th), Guatemala (63rd), Philippines (64th), Indonesia (70th), Pakistan (76th), India (77th) and Nigeria (82th). Here again, the differences between ranks appear to overstate the real differences.

While Mexico has made impressive progress concerning mother’s and baby’s health, it still lags behind Argentina and Brazil not to mention virtually all European countries. The biggest concern is rural areas of Mexico, especially southern Mexico, which seriously trail urban Mexico in terms women’s and child’s health. For example, infant mortality rates are highest in Chiapas, Oaxaca and Guerrero, followed by Veracruz, Hidalgo and Puebla. On the bright side, rural areas are making great progress thanks to programs like Oportunidades.

Happy Mother’s Day!

 

The growth and expansion of Wal-Mart in Mexico

 Mexico's geography in the Press, Updates to Geo-Mexico  Comments Off on The growth and expansion of Wal-Mart in Mexico
May 052012
 

Much recent attention in the USA and Mexico has focused on the allegations of bribery related to Wal-Mart de México.  Interestingly, the company has a rather long history in Mexico. It started in 1958 when Jerónimo Arango and his brothers Placido and Manual started a company called Cifra and opened a deep discount store in Mexico City named Aurrera Bolivar. It was inspired by the E.J. Korvette discount store in New York City. The store was an immediate success, helped by sponsorship of the popular TV show, La Pregunta de los $64,000 pesos (“The $64,000 Pesos Question”).

Wal-Mart's expansion across Mexico, 1993-2007

Wal-Mart's expansion across Mexico, 1993-2007. Click map to enlarge

By 1965 Cifra had eight Aurrera stores in the Mexico City area as well as a Superama grocery store and VIPS restaurant. Cifra and Jewel-Osco of Chicago formed a joint venture and by 1970 they opened the first Bodega Aurrera discount warehouse stores and Suburbia department stores. Their first hypermarket, Gran Bazar, followed in 1976. Shares in the company were sold to the public in 1977.   By serving low-income customers, the company managed to survive the financial crisis of 1982.  In fact during the 1980s it increased sales by an average 20% per year reaching US$550 million by 1989.

Rapid growth continued in the 1990s. By 1992 there were 38 Almacenes Aurrera supermarkets, 29 Bodega Aurreras, 34 Superamas, 29 Suburbias (department stores), 59 VIPS, as well as 15 El Portón restaurants. Almost all of these were located in the densely populated Mexico City and surrounding State of Mexico. Phenomenal growth continued in 1992 with 23 new units added. Cifra B shares increased forty-fold in just five years from the start of 1988 through the end of 1992. At that time, Cifra had a sophisticated, state-of-the-art data system for inventory control and monitoring customer preferences.

In 1991 Cifra formed a joint venture with the US firm Wal-Mart (founded in 1962, four years after Cifra). Unlike Cifra, whose early growth was based on an enormous urban area, Wal-Mart USA’s incredible early growth concentrated on rural areas. Initially the joint venture focused on trade and the members’ only Club Aurrera, which was soon renamed Sam’s Club. The first map shows the distribution of Wal-Mart stores in 1993. Expansion of new outlets throughout Mexico was only slightly slowed by the 1994 financial crisis.

By 1995, there were 22 Sam’s Clubs, and 11 Wal-Marts, 35 Almacenes Aurrera, 58 Bodegas Aurrera, 36 Superamas, 33 Suburbias, as well as 114 VIPS restaurants. One of the new Wal-Mart Supercenters was the largest in the world. The signing of NAFTA in 1994 strengthened the joint venture. In 1997 Wal-Mart USA acquired majority interest in Cifra creating Wal-Mart de Mexico or Walmex. The company, which previously had been heavily concentrated in Metro Mexico City, was soon aggressively opening new units in cities throughout the country (see maps).

Recent news reports allege that this aggressive growth may have been facilitated by payments of bribes to expedite construction permits. As of March 2012, Walmex was operating no fewer than 2,106 retail units throughout Mexico. They include 127 Sam’s Clubs, 213 Walmart Supercenters, 94 Suburbias, 385 Bodega Aurreras, 88 Superamas, 358 VIPS and El Portón restaurants, and over 840 Bodega Aurrera Expresses and other small outlets.

Wal-Mart de México is the country’s largest retailer, with sales of over US$24 billion, and largest private-sector employer, with 209,000 employees. These figures make Walmex the dominant player in its sector, well ahead of its Mexican supermarket rivals: Soriana ($8 billion); Comercial Mexicana (Mega, $4.5 billion) and Chedraui ($4.4 billion).

The 2007 map shows how Wal-Mart has now expanded into some areas where the population density is relatively low. The early expansion of Wal-Mart was into areas with high population density, where a single, well-placed store could easily be accessed by a lot of people, and therefore have the potential to be highly profitable. Even with the 2007 distribution, however, there is still a marked north-south divide in access to Wal-Mart, which reflects income disparities in Mexico.

In 2009/10 Walmex acquired Walmart Centroamérica and is now named Wal-Mart de México y Centroamérica, adding 622 retail outlets in Guatemala, El Salvador, Honduras, Nicaragua and Costa Rica, to bring the total number of units it operates (including Mexico) to 2, 728 retail outlets (with sales of about $29 billion) compared to Wal-Mart USA’s 4,468 outlets (with 2011 sales of $447 billion).

Source for maps:  

The maps have been redrawn, based on maps in “Supplier Responses to Wal-Mart’s Invasion of Mexico”  by Leonardo Iacovone, Beata Smarzynska Javorcik, Wolfgang Keller, James R. Tybout. Working Paper 17204  of the National Bureau of Economic Research, Cambridge, MA, USA.

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Net migration flow from Mexico to the USA falls close to zero or has possibly reversed

 Books and resources, Updates to Geo-Mexico  Comments Off on Net migration flow from Mexico to the USA falls close to zero or has possibly reversed
Apr 262012
 

The following are extracts from the text of a press release from the Pew Hispanic Center entitled “Net Migration from Mexico Falls to Zero—and Perhaps Less“, by Jeffrey Passel, D’Vera Cohn and Ana Gonzalez-Barrera:

The largest wave of immigration in history from a single country to the United States has come to a standstill. After four decades that brought 12 million current immigrants—more than half of whom came illegally—the net migration flow from Mexico to the United States has stopped—and may have reversed, according to a new analysis by the Pew Hispanic Center of multiple government data sets from both countries. The report is based on the Center’s analysis of data from five different Mexican government sources and four U.S. government sources. [see original article for sources]

The standstill appears to be the result of many factors, including the weakened U.S. job and housing construction markets, heightened border enforcement, a rise in deportations, the growing dangers associated with illegal border crossings, the long-term decline in Mexico’s birth rates and changing economic conditions in Mexico.

Among the report’s key findings:

  • In the five-year period from 2005 to 2010, about 1.4 million Mexicans immigrated to the United States and about 1.4 million Mexican immigrants and their U.S.-born children moved from the United States to Mexico.
  • In the five-year period a decade earlier (1995 to 2000), about 3 million Mexicans had immigrated to the U.S. and fewer than 700,000 Mexicans and their U.S. born-children had moved from the U.S. to Mexico.
  • This sharp downward trend in net migration has led to the first significant decrease in at least two decades in the number of unauthorized Mexican immigrants living in the U.S.—to 6.1 million in 2011, down from a peak of nearly 7 million in 2007.
  • Mexicans now comprise about 58% of the unauthorized immigrants living in the United States. They also account for 30% of all U.S. immigrants.
  • Apprehensions of Mexicans trying to cross the border illegally have plummeted by more than 70% in recent years, from more than 1 million in 2005 to 286,000 in 2011—a likely indication that fewer unauthorized immigrants are trying to cross.
  • As apprehensions at the border have declined, deportations of unauthorized Mexican immigrants—some of them picked up at work or after being arrested for other criminal violations—have risen to record levels. In 2010, nearly 400,000 unauthorized immigrants—73% of them Mexicans—were deported by U.S. authorities.
  • Looking back over the entire span of U.S. history, no country has ever sent as many immigrants to this country as Mexico has in the past four decades. However, when measured not in absolute numbers but as a share of the immigrant population at the time, immigration waves from Germany and Ireland in the late 19th century equaled or exceeded the modern wave from Mexico.

– – – end of quotations from press release – – –

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Mexico, the home of corn, is now the world’s largest corn importer

 Updates to Geo-Mexico  3 Responses »
Apr 162012
 

In just 20 years, Mexico has gone from a nation that needed to import less than 400,000 metric tons of corn (maize) a year in order to satisfy its domestic market to one where, in the 2011-12 season, it will need to import almost 10,000,000 tons.

One producers’ organization, Mexico’s National Confederation of Maize Growers (CNPAMM), argues that this reliance on imports has relegated the work done by its members to a relatively minor role in providing the nation with food. The growers claim that the price they receive for corn (post-NAFTA) has declined in the face of cheaper imports, jeopardizing their livelihoods. (For one view of the changes post-NAFTA, see NAFTA Truth and Consequences: Corn).

On the other hand, in the past few years, the costs of imported corn have risen sharply, meaning that consumers have to pay more for their tortillas. In order to preserve some stability, the Mexican government has bought corn futures which guarantee corn prices for a period of time.

How is it possible that the country that gave the world corn is now so dependent on imports of corn, almost all of which come from the USA? According to the CNPAMM, it is the result of speculation, market distortion and failures in Mexico’s economic policy. Héctor Carlos Salazar, the president of CNPAMM, called on maize growers to demand better prices, a reduction in imports, and some guarantees from the politicians fighting this year’s federal elections that they will take steps to ensure Mexico’s self-sufficiency in foodstuffs.

Salazar has been quoted in the press as offering some interesting statistics for the impacts of every additional ton of corn that Mexico imports from abroad. He claims that each ton imported reduces agricultural employment by 4.54 man-hours. It also reduces other inputs: diesel by 6 liters, fertilizers by about 100 kg, insecticides by 1 liter, pesticides by 3 liters and improved seeds by about 4 kg.

The bottom line is that it is not just the food security, particularly of Mexico’s poorest, that is threatened by rising corn imports, it is also Mexico’s economy.

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The world’s richest man in 2011 and other Mexican billionaires

 Mexico's geography in the Press, Updates to Geo-Mexico  Comments Off on The world’s richest man in 2011 and other Mexican billionaires
Mar 192012
 

The Forbes magazine list of the world’s richest individuals in 2011 consists of more than 1500 individuals, each with a wealth of one billion dollars or more. Eleven Mexicans (all men, but one more than last year) made the list. The eleven richest Mexicans are:

World rank / Name / Estimated wealth according to Forbes / Main business interests

#1 Carlos Slim Helú and family, 69.0 billion dollars, making him the richest man in the world. Fixed line telephone provider Telmex, cell phone provider América Móvil, Grupo Carso, Inbursa. [Slim Helú stays in top spot]

#37 Ricardo Salinas Pliego and family, 17.4 billion dollars. Television company Televisón Azteca, domestic appliance store Elektra, bank Banco Azteca, and cell phone company Iusacell [Salinas Pliego gained 26 places in the ranking]

#38 Alberto Bailleres and family, 16.5 billion dollars. Mining giant Peñoles, department store El Palacio de Hierro and Grupo Profuturo [almost doubled his wealth in 2011, up 44 places]

#72 Germán Larrea Mota Velasco and family, 14.2 billion dollars. Grupo México – mining for copper and other minerals

#276 Jerónimo Arango and family, 4 billion dollars. Founder of Aurrerá supermarket chain and Grupo Cifra which controlled VIPS and El Portón restaurant chains, Suburbia department stores and tourist developments in Baja California Peninsula and Acapulco

#634 Emilio Azcárraga, 2.0 billion dollars. Television and media conglomerate Televisa,and Nextel cell phones

#683 Roberto Gonzalez Barrera 1.9 billion dollars. Banking and tortillas

#913 Carlos Hank Rhon & family, 1.4 billion dollars. Banking

#960 Roberto Hernández, 1.3 billion dollars. Banker, one of main shareholders of Citigroup, and tourist developments in the Yucatán Peninsula

#1153 (equal) Alfredo Harp Helú and family, 1 billion dollars. Shareholder in Citibank, telecommunications firm Avantel

#1153 (equal) Joaquín Guzmán Loera (aka “El Chapo”), 1 billion dollars. Mexico’s most wanted man, head of the Sinaloa drugs cartel, the main supplier of cocaine to the US market

The combined total wealth of these eleven individuals is a staggering 129.7 billion dollars (compared to the billionaires’ total of 90.3 billion dollars in 2010). The 2011 figure is equivalent to more than 6% of Mexico’s GDP.

The average earnings of Mexican workers registered in IMSS (Mexico’s Social Security Institute) is about 230 pesos a day or $6,600 (dollars) a year. The combined wealth of Mexico’s eleven richest individuals is therefore equivalent to the total annual salaries of 19.65 million Mexicans earning this average salary! [Last year, the combined wealth of Mexican billionaires was equivalent to “only” 14.3 million Mexicans earning the then average salary.]

Clearly, there are a handful of extremely wealthy individuals living in Mexico, alongside millions of Mexicans who are living at or below the poverty line. These income disparities have existed for a very long time, and are examined in detail in chapter 14 of Geo-Mexico: the geography and dynamics of modern Mexico. That chapter also analyzes the spatial patterns of wealth in Mexico, and discusses whether the gap between rich and poor has widened or narrowed in recent years.

Chapter 29 discusses Gender inequities in Mexico and  Oportunidades, a poverty reduction program (both links are to excerpts from that chapter).

Related articles:

 

 

Update: Remittances worth almost 23 billion dollars in 2011

 Updates to Geo-Mexico  Comments Off on Update: Remittances worth almost 23 billion dollars in 2011
Mar 092012
 

Remittances sent home by Mexican migrants, almost all of them residing in the USA, rose 6.9% in 2011 (compared to 2010) to 22.730 billion dollars. Remittances are the second largest source of foreign exchange in Mexico after crude oil exports.

The average amount sent was 326.26 dollars, with 98% of remittances made via electronic transfer. The states receiving most remittances were Michoacán (2.238 billion dollars, 10% of the total), Guanajuato (2.147 billion), Jalisco (1.889 billion), the State of Mexico (1.653 billion) and Puebla (1.465 billion).

For more detail about remittances in Mexico, see:

Mexico and USA sign agreement for development of Gulf of Mexico oil reserves

 Updates to Geo-Mexico  Comments Off on Mexico and USA sign agreement for development of Gulf of Mexico oil reserves
Feb 272012
 

The USA and Mexico share the Gulf of Mexico, with periodic arguments about the precise offshore limits of each country’s jurisdiction. An earlier post includes a brief summary of the history of negotiations over this contentious maritime boundary:

The reason this boundary matters is because the deep waters of the Gulf of Mexico are thought to have massive deep-water oil and gas fields. The USA has encouraged major oil multinationals such as Shell and BP to explore relatively deep parts of the Gulf, those lying more than 500 meters or 1,640 feet below sea level.

location of doughnut holesDeveloping these fields requires advanced, specialist deep-water drilling techniques, which only a small number of major international (multinational) oil firms currently have the expertise to undertake. As was seen not long ago, accidents in these fields can be very difficult to avoid and any resulting damage very difficult to clean up:

The legal battle connected to that spill has been postponed; it had been due to start today (27 February 2012) in a New Orleans court. The April 2010 accident killed 11 oil workers and released up to 5 million barrels of oil into the Gulf.

In the Mexican sections of the Gulf of Mexico, very little oil exploration and development has yet been carried out. All oil exploration and development in Mexico is managed by state-owned oil giant Petroleos Mexicanos (Pemex), though they can contract other firms to undertake work on their behalf if or when needed. Pemex is the world’s third-largest oil producer and the largest contributor to Mexico’s federal budget. It is one of the very few oil companies worldwide that manages all aspects of the productive chain, from exploration to refining and marketing. Pemex has had more than its fair share of serious environmental issues:

Mexican experts believe that up to 29.5 billion barrels of oil might reside in Mexico’s share of the Gulf, but Pemex has little to show for almost a decade of deep-water drilling apart from some relatively minor gas finds.

A few days ago, Mexico and the USA finally signed an accord that, in the words of Mexican President Felipe Calderón, “ensures that each country can develop its corresponding oil and natural gas deposits in the trans-border area of the Gulf of Mexico.” In a joint formal statement, Mexico’s Foreign Affairs and Energy Secretariats said that the “historic” agreement “will generate the necessary legal certainty for the long-term development of resources that may be found in that area.” It remains to be seen just how quickly and efficiently Pemex can actually take advantage of the deep-water drilling opportunities that the new agreement is designed to safeguard.

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Is Mexico really one of world’s reforestation success stories?

 Mexico's geography in the Press, Updates to Geo-Mexico  1 Response »
Feb 132012
 

No one doubts the need for reforestation in Mexico. Since colonial times, huge swatches of the country have been denuded of their native vegetation. Recent figures from INEGI suggest that Mexico has lost almost 50% of its native forests due to logging and clearance for farming and settlement. The majority of this loss is in the Volcanic Axis belt that stretches west-east across the center of Mexico at an average height of 3000 m above sea level, but tropical rainforest areas much further south have also been decimated.

There is, however, some encouraging news.

Data released by the UN Environment Programme (UNEP) puts Mexico in a lofty 4th place worldwide for the number of trees planted since UNEP began its “Billion Trees Campaign”  in 2007. According to the UNEP figures, only China, India and Ethiopia have planted more trees than Mexico.

The “Billion Trees Campaign, inspired by the work of the late Nobel Peace Prize Laureate Wangari Maathai, recognizes that trees bring multiple benefits to people, ranging from carbon sequestration and the provision of timber to soil erosion control, enhanced aesthetic value and opportunities for recreation. UNEP claims that 12 billion trees have been planted worldwide since the program began.

The short Youtube video – Taking Root The Vision of Wangari Maathai –”tells the dramatic story of Kenyan Nobel Peace Prize Laureate Wangari Maathai whose simple act of planting trees grew into a nationwide movement to safeguard the environment, protect human rights, and defend democracy—a movement for which this charismatic woman became an iconic inspiration.” (http://takingrootfilm.com)

Poster prepared by Reforestamos México A.C.

Poster prepared by Reforestamos México A.C. (Mexican NGO) Visit www.reforestamosmexico.org for more information

But are the UNEP figures all they appear to be? Certainly, Mexico’s Environment Secretariat has organized, for many years, on-going programs of reforestation and conservation designed to stem the tide of logging that decimated Mexico’s natural forests over the past century. Official figures show that the pace of this effort has accelerated in the past few years. For example, between 2007 and 2011, Mexico’s National Forestry Commission protected, restored or reforested 21,000 square kilometers  (8100 sq. mi) across the country, an area equivalent to the state of Hidalgo. The total area reforested in those five years amounts to more than 3500 square kilometers  (1350 sq. mi).

On the other hand, critics of Mexico’s forestry policies, such as Greenpeace claim that up to 70% of all lumber sold in Mexico has been illegally harvested, and that less than 60% of trees planted in national campaigns survive their first few critical years.

Deforestation in the Monarch Butterfly Biosphere Reserve

One of the most critical areas, one where continued deforestation could be a real “game-changer”, is the Monarch Butterfly Biosphere Reserve which straddles the boundary between Michoacán and the state of Mexico. This is where millions of Monarch butterflies arrive each year from as far north as Canada to spend their winter. The butterfly itself is not endangered (there are non-migratory populations in many countries, and a year-round resident population in Mexico) but what assuredly is endangered is the “migratory phenomenon” of the Monarchs. Adequate forest cover at an altitude where winter weather is consistently within a narrow temperature band is absolutely crucial to the survival of this spectacular annual migration.

According to the National University (UNAM)’s Environmental Geography Research Center, at current rates of deforestation, the area of overwintering sites for the Monarch butterflies could be reduced by 75% in the next 18 years, leaving just 12,000 ha of suitable habitat. The protected area, established in 2000, covers 560 square kilometers (56,000 ha. or 216 sq. mi) but includes land cleared for pasture, settlement and cultivation. Researcher José López García claims the reserve is losing 3% of its forest each year. He blames clearance and changes of land use more than illegal logging. The rate of forest clearance has been exacerbated by a rapid rise in the population of the El Rosario ejido. El Rosario is the gateway to the most-visited part of the reserve, attracting thousands of tourists annually. The ejido’s population rose by an average of 5.65%/year between 2005 and 2010.

How will climate change affect Mexico’s forests?

Climate change is predicted to have several effects on Mexico’s forests. These include:

  • tropical rainforests (in both Mexico and Brazil) will gradually decline in extent, rainforest soils will have reduced fertility and some parts will become tropical grasslands.
  • the semi-arid areas in central and northern Mexico will become drier, and the total area of arid areas will increase

Globally, deforestation is believed to account for 17.4% of greenhouse gas emissions, so forest protection and reforestation are key strategies in efforts to mitigate the effects of further cliamte change.

The Eastern Drainage Tunnel: a solution to Mexico City’s drainage problems?

 Updates to Geo-Mexico  1 Response »
Jan 232012
 

As we saw in an earlier post – Attempts to provide drainage for Mexico City date back to Aztec times – Mexico City has serious drainage problems. Because of the shifting subsoil as the land on which the city was built sinks an average of 10 cm/yr, the main drainage tunnels built years ago no longer have the slope (grade) they need to work efficiently. At least one of the feeder tunnels now slopes in the wrong direction!

This has greatly increased the risk of catastrophic flooding occurring. After years of discussion, authorities decided a few years ago that the only viable solution was to construct another major drainage tunnel to take pressure off the existing system and increase the maximum drainage rates following heavy storms.

The new tunnel, known as the Eastern Drainage Tunnel (Túnel Emisor Oriente), is said to be the world’s largest ever drainage tunnel and should be completed within the next couple of years. It is 7 m (23 ft) in internal diameter (wide enough for a tractor trailer) and can carry up to 150 cubic meters of water a second.

Map of tunnel route

Map of tunnel route; the new tunnel is in red, the existing Central Tunnel is in blue

The tunnel is 62 km (39 mi) long. It starts from the interceptor channel of Río de los Remedios and ends in a treatment plant in Atotonilco de Tula (Hidalgo), close to where the existing Central Drainage Tunnel flows into the El Salto River. Atotonilco receives 725 million cubic meters of water each year carrying 180,000 tons of garbage. Some of the treated water will be piped to the Mezquital Valley Irrigation District in Hidalgo where water usage exceeds natural replenishment rates. The remainder of the treated water will be given additional (tertiary) treatment before being piped into the overexploited underground aquifers to replenish them.

photo of new tunnelThe Eastern Drainage Tunnel construction project is one of Mexico’s largest engineering undertakings ever. The total investment (45% government, 55% private) is almost a billion dollars. Six massive boring machines are working in coordination, each boring a 10km section of the tunnel. The work is challenging, partly because of the varied nature of the rocks (limestone, volcanic rock, sand and clay) and partly because parts of the tunnel are as much as 200m (equivalent to 40 stories) below the surface.

Ventilation shaft of new tunnel

Ventilation shaft of new tunnel

How sustainable is organic agriculture on the Baja California Peninsula in Mexico?

 Mexico's geography in the Press, Updates to Geo-Mexico  Comments Off on How sustainable is organic agriculture on the Baja California Peninsula in Mexico?
Jan 192012
 

In recent years, a farming boom has completely changed the landscape in parts of Mexico’s Baja California Peninsula. The new landscape is comprised of organic farms, specializing in growing fresh produce, especially out-of-season, certified organic, fruits and vegetables, which carry premium prices.

“Organic” has come to mean very different things in different countries, but the essential common element is that it uses no synthetic fertilizers, hormones or pesticides. In the USA, the term “organic produce” also requires that farmers protect water resources, though this is hard to define and at least as hard to enforce.

The Baja California Peninsula receives very little rainfall, so irrigation water for its organic farms comes from underground aquifers. The profitability of these new farms relies on the availability of irrigation water and on the proximity of the region to the lucrative US market for organic produce.

The new farms may be “organic”, but the bigger question, examined by Elisabeth Rosenthal in Organic Agriculture May Be Outgrowing Its Ideals, in the New York Times is, “Are these organic farms sustainable?” Rosenthal looks in some detail at whether or not organic farms protect the local environment and the livelihood of local farmers. The article discusses the extreme stress being placed on the area’s ground water reserves. Some farmers are already in trouble because their wells have dried up. More than one-third of aquifers in the southern part of the peninsula are officially classified as “over-exploited”.

Growers blame the area’s tourism industry for the water shortages, arguing that hotels and golf courses gobble up far more than their fair share of the precious resource. Despite the aridity of the southern section of Baja California Peninsula, the southern coast, centered on Los Cabos, has far more golf courses per unit area than anywhere else in the country.

The “organic” label also takes no account of the emissions involved in production and transport of fruits and vegetables to the marketplace; export-oriented horticulture in the Baja Peninsula is an energy-intensive enterprise. Adding to the unsustainable side of the argument, some of the organic farms practice “monoculture”, growing a single crop year after year on the same land, a system known to lead to soil depletion and increase the risk of pest-related problems.

On the other hand, the new farms also provide an alternative source of jobs to tourism. Del Cabo, which has a cooperative packing plant in San José del Cabo and trucks or flies more than 7 metric tons of produce to the USA every day, is able to help its members by supplying high-quality seed, and employing specialists in plant raising and plant diseases who act as consultants to individual farmers as required. Del Cabo criticized the New York Times story for its numerous inaccuracies regarding water usage and sustainability.

Conscious of the water issues, many of these modern organic farms employ sophisticated, water-conserving irrigation systems, such as computerized drip irrigation. They also grow many crops under shade. Such systems are expensive to install and maintain, so most of the bigger producers are US-owned companies.

In Organic Tomatoes in January: Sucking Mexico Dry, in Mother Jones, Tom Philpott compares the situation in Baja California with that in “another region famous for winter tomatoes and dirt-cheap labor costs: Immokalee, Florida, source of a huge percentage of non-organic winter tomatoes consumed in the United States.” Philpott concludes that “What’s going on in Baja seems more about generating a premium-priced product while systematically degrading a landscape. Want organic tomatoes in the cold months? Buy them in a can.”

Food for thought!

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Mexico’s Puente Baluarte, the world’s tallest cable-stayed bridge, now officially open

 Mexico's geography in the Press, Updates to Geo-Mexico  Comments Off on Mexico’s Puente Baluarte, the world’s tallest cable-stayed bridge, now officially open
Jan 052012
 

Earlier today, President Felipe Calderón inaugurated the Puente Balarde, the world’s tallest cable-stayed bridge.

The bridge is 1.124 km long and wide enough for 4 lanes of traffic. Its central span extends 520 meters. At its highest point, it is a gravity-defying 403 metres (1322 feet) above the River Baluarte from which it takes its name. The bridge’s largest supporting pillar is 153 meters high, with a base measuring 18 meters by 30 meters.

Puente Baluarte Bicentenario. Photo: TRADECO

Construction, by Mexican firm TRADECO, has required 103,000 tons of cement and almost 17,000 tons of steel. The bridge joins the states of Durango and Sinaloa and removes the need for drivers to negotiate a very dangerous stretch of highway known as the Devil’s Backbone.

It is the centerpiece of a new highway between Durango and the Pacific coast resort of Mazatlán. The 312 km drive between the two cities, which took about five hours prior to the completion of the bridge, will now be dramatically shortened.

“This project will unite the people of northern Mexico as never before,” President Calderón said at the inauguration ceremony. Accordoing to the BBC, officials from the Guinness World of Records were on hand to present him with an award recognising the engineering feat. The previous record holder was the elegant Millau Viaduct in France.

Travel Note:

Even though the bridge has been inaugurated, the new Durango-Mazatlán highway is still many months from completion.

Update: New Durango-Mazatlán highway officially open(Oct 2013)

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Do paved roads lead to development?

 Excerpts from Geo-Mexico, Updates to Geo-Mexico  Comments Off on Do paved roads lead to development?
Jan 042012
 

In chapter 24 of Geo-Mexico, we described a typology of rural settlement locations and wrote that “rural localities near roads” (defined as those settlements within 3 km (2 mi) of a paved road) are an important category since they house 54% of all Mexico’s rural population. In fact, such settlements account for almost 90% of rural population in Quintana Roo and over 70% of the rural population in the states of Zacatecas, Yucatán, Campeche, San Luis Potosí, Nuevo León and Coahuila.

We explained that while “One of us believes that the location of paved roads is having an impact on rural settlement patterns, the other believes that rural settlement patterns are having an impact on the location of paved roads! Both viewpoints may be correct with their relative importance depending on the region in question.”

Shortly after the publication of Geo-Mexico, a loyal reader (“Jerezano“) wrote to us, agreeing with us, and sharing his personal insights into “rural localities near roads” based on his 23+ years living in the beautiful, small town of Jerez, in the state of Zacatecas. He writes,

“You are both correct, of course.”

“The rural settlement was in most cases located where it was long before the roads were paved. A municipality (municipio), when it decides to pave a road, considers many things:

  • a) Where does the money come from? Local residents, associations of residents in foreign countries who send money back for improvements? and municipal and federal matching funds?
  • b) Existing population figures which of course influence the traffic on the roads.
  • c) Economic contribution of that rural community to the welfare of the state and municipality.”

“So, a rural community with a fairly large population, a robust economy, and an active out-of-town group of supporters, will get a paved access road long before a different community which lacks those attributes. That is easily observable in almost any location.”

“But, once that access road has been paved, the influence is also usually observable by the improved economy of that community. Easy access of products to markets, easy access of potential new residents to the city, etc. will stimulate increases in costs of real estate, living, etc.”

“Here in Zacatecas, for example, the paving of the road to Susticacán from the Jerez-Guadalajara highway stimulated a building boom which is still in progress. The construction of the new 4- lane divided highway from Zacatecas City to Concepción de Oro, and now underway from Concepción de Oro to the Coahuila border, has created an extremely active trailer stop at the Villa de Cos intersection. Before the new highway was started, that intersection was a place with potential and people who had constructed facilities such as restaurants, hotels and a gasoline station were waiting with baited breath.”

Mexican trucks“They are now reaping the benefits of the movement of many, many tractor-trailers from the Ramos Arizpe to San Luis Potosí highway and on to Mexico over to the new Ramos Arizpe to Zacatecas to Mexico highway. At the Villa de Cos intersection where, in the past, you would see pickups, quarter ton, 3/4 ton and a maximum of 4 to 10 ton trucks, you can now see as many as 10 to 20 semi-trailers and doble-remolques (double drop trailers) parked in front of the main restaurant and hotel. All this because the road has been steadily improved over the years from a narrow, two lane Federal highway, with a bad surface most of the distance, to the modern 4 lane divided highway easily transited by rigs which (God forbid) are really too big to be on the highways.”

We sincerely thank Jerezano for taking the time to share these valuable personal insights into rural roads in his “neck of the woods” in Zacatecas, and hope that the New Year brings him and all our readers Health, Happiness and Prosperity.

Mexican Home Town Associations (HTAs) and their considerable effectiveness

 Updates to Geo-Mexico  Comments Off on Mexican Home Town Associations (HTAs) and their considerable effectiveness
Dec 292011
 

Home Town Associations (HTAs) are associations created by migrants to promote links between their hometown communities of origin (Mexico) and their communities of residence in the USA. Many HTAs raise money (via dances, raffles, beauty pageants and other events) to fund public works and social projects in Mexico.

Mexico offers important additional funding to multiply the impact of “collective remittances” sent home from HTAs. Every dollar sent home is matched by three dollars, one from each level of Mexico’s political administration: federal, state and municipal. This means that a relatively small input of dollars from an HTA can be the catalyst to fund a school or new road.

From 1993 to 2000, investments financed by the program totaled $16.2 million, for projects ranging from street paving, irrigation and drainage to new or revamped cemeteries, parks, plazas, community centers and athletic facilities. The average cost of these projects is $56,000; almost two-thirds of projects are in communities of fewer than 2000 inhabitants.  [Source: “Migrant’s Capital for Small Scale Infrastructure and Small Enterprise Development in Mexico,” World Bank, January 2002.]

Case study of the 3×1 scheme: Atacheo de Regalado (Michoacán)

Atacheo de Regalado has a population of fewer than 2000 inhabitants, and is only 15 km. northeast of the large commercial city of Zamora, in the state of Michoacán.

Atacheo de Regalado has implemented five productive community projects under the “3 dollars for 1” scheme, based on remittances sent home from migrants in the USA, mainly in Illinois. The projects, involving 336 families, have been organized by the priests of a local church, and include a turkey farm, a goat farm, hydroponics green houses to grow vegetables and flowers for export, a factory for loudspeakers and baffles, and a bull-fighting ring. These five projects represent a total investment of about $1.5 million (dollars). The community exported 220 tons of tomatoes to the USA in 2003.

Two more projects, will need investments of about $2 million to complete, are planned:

  • 1. A rastro (meat factory) to process up to 2000 turkeys a day for sale to supermarket chains.
  • 2. A pasteurization plant for goat milk, to process up to 40,000 liters daily for export to the USA.

[This post is based on the World Bank Working Paper by Raúl Hernández-Coss, entitled “The U.S.–Mexico Remittance Corridor: Lessons on Shifting from Informal to Formal Transfer Systems”.]

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