The Americas

Mexico's Special Economic Zones 6/25/16

Article: "How the bottom half lives  

The Mexican government hopes to improve the lot of the south by creating special Economic Zones, which will have lower taxes or less regulation than the rest of a country.

Northern Mexico is where the manufacturing happens, thanks in part to maquila laws that allow duty-free importation of materials as long as the finished product is exported. Between 1980 and 2000 these laws boosted the share of international trade in Mexico’s GDP from 11% to 32%. Southern Mexico is poorer and rural, with an economy based on agriculture. The Mexican government hopes to improve the lot of the south by creating special Economic Zones, which will have lower taxes or less regulation than the rest of a country. The intention is to promote investment in deprived areas with incentives that might be unaffordable, unpopular or unnecessary if applied nationally. First used in Ireland in 1959, they now number over 4,300 globally. (Commenters think the real problem in Mexico is widespread corruption - the nation is referred to as a “Mafiacracy").