till faces key challenges. During the 1980s, the accumulation of
large external debts, falling world petroleum prices, rapid population
growth, and mounting inflation and unemployment plagued the economy.
In recent years, the government has responded by implementing sweeping
economic reforms. Strict fiscal and monetary discipline have brought
inflation under control, reduced the internal debt, and produced
budgetary surpluses in 1992 and 1993. The tight money policies,
however, have restricted growth: barely 0.4% in 1993 after a rise of
2.6% in 1992 and 3.6% in 1991. Another aspect of the reform has been
the privatization of more than 80% of Mexico's businesses, including
all of the commercial banks. Seeking out increased trade and
investment opportunities, the government negotiated the North American
Free Trade Agreement (NAFTA) with the United States and Canada, which
entered into force on 1 January 1994. Within Latin America, Mexico has
completed bilateral free trade agreements with Chile and Costa Rica,
and is continuing negotiations with Colombia and Venezuela for a
trilateral deal in addition to holding trade discussions with various
other nations. In January of 1993, Mexico replaced its old peso at the
rate of 1,000 old to 1 new peso. Despite its hard-won economic
progress and the prospects of long-term gains under NAFTA, Mexico
still faces difficult problems, including sluggish growth,
unemployment, continuing social inequalities, serious pollution, and
the prospect of increased competition with the opening of trade.
National product:
GDP - purchasing power equivalent - $740 billion (1993 est.)
National product real growth rate:
0.4% (1993)
National product per capita:
$8,200 (1993 est.)
Inflation rate (consumer prices):
8% (1993 est.)
Unemployment rate:
10.7% (1992 est.)
Budget:
revenues:
$58.1 billion
expenditures:
$53 billion, including capital expenditures of $3.4 billion (1992
est.)
Exports:
$50.5 billion (f.o.b., 1993 est.), includes in-bond industries
commodities:
crude oil, oil products, coffee, silver, engines, motor vehicles,
cotton, consumer electronics
partners:
US 74%, Japan 8%, EC 4% (1992 est.)
Imports:
$65.5 billion (f.o.b., 1993 est.), includes in-bond industries
commodities:
metal-working machines, steel mill products, agricultural machinery,
electrical equipment, car parts for assembly, repair parts for moto