Mexico

   

Policy Performance

#38

Economic Policies

#35
With its new president confronting numerous challenges, Mexico scores relatively poorly (rank 35) with regard to economic policies. Its score on this measure has improved by 0.1 point relative to 2014.

Despite a general macroeconomic stability in recent years, GDP growth has been slow by OECD standards. The country has the lowest tax-to-GDP ratio in the OECD, with tax evasion a problem, and a large informal sector. Unemployment rates are low, and new President López Obrador has created a new program to fight youth unemployment.

Concerns over the relationship with the United States were mitigated somewhat by the trilateral agreement on a new U.S.-Canada-Mexico trade agreement. After initial fears, financial markets have responded well to López Obrador, following his promises to increase industrial investments.

A 2014 reform aimed at reducing dependency on oil revenues assumed robust GDP growth and high oil prices, neither of which has emerged. Fiscal autonomy has thus remained elusive. A problematic opacity in public spending has been partially addressed through new anti-corruption laws. Dealing with financial inflows from illegal drug-related activities remains a major challenge.

Social Policies

#41
Despite ongoing reforms addressing weaknesses, Mexico takes the lowest place in the SGI 2019 (rank 41) in the area of social policies. Its score on this measure has declined by 0.1 point relative to 2014.

Education outcomes are poor despite relatively significant spending. The incoming president is reversing his predecessor’s controversial education reforms, and has proposed making public education free. Income inequality is very high, with poverty strongly concentrated among indigenous and rural populations. A food-support program addressing extreme poverty has been very effective.

Health care quality varies widely. A voluntary health insurance policy that supports informal workers has helped reduce uninsured rates from 50% to 21.5% in 2017. Family policy is minimal. Urban areas are supportive of women’s rights, but poorer women have fewer labor-market opportunities. The strong demand for early child care and preschool services is unmet.

Only a minority of the population is covered by pensions, but a pension reform has been promised. Integration policy is virtually nonexistent. Drug cartels are responsible for widespread and brutal crimes. The new government is creating a national guard to combat the cartels, headed by the military. The high number of disappeared and probably murdered women is a serious problem.

Environmental Policies

#33
Despite a growing awareness of environmental issues, Mexico receives a comparatively low overall ranking (rank 33) with respect to environmental policies. Its score in this area has improved by 0.4 points relative to 2014.

A landmark climate-change law went into effect in 2012, but implementation continues to be slow at the federal-state level. An energy reform has made the renewable-energy sector more stable and competitive. However, the country is the second-biggest emitter of greenhouse gases in Latin America.

Serious environmental problems persist, including the provision of clean water, air pollution in Mexico City, and rural deforestation and erosion. Policy strides have been made particularly in air-quality regulation. However, enforcement is lax, and many companies do not comply with regulations. The country is also one of Latin America’s main recipients of funds from clean-development mechanisms.

The country has been praised internationally for proactive innovation, but domestic environmental policymaking has not kept pace. The importance of the oil industry for the economy has created substantial barriers to credible domestic policy activity.

Democracy

#39

Quality of Democracy

#39
Struggling to contain corrosive organized-crime influences, Mexico falls into the bottom ranks internationally (rank 39) with regard to democracy quality. Its score in this area has declined by 1.1 points relative to 2014.

Elections are highly regulated, but crime-group activities undermine electoral integrity. The 2018 election campaign was the most expensive in history, with vast sums spent illegally. The media is independent of government, but rampant violence against journalists makes reporting on corruption and collusion dangerous. Social media has helped bypass oligopolistic media structures.

The security forces frequently violate civil rights, with courts failing to provide adequate protection. A new law against forced disappearances, a very serious problem, has not been implemented. The new president has promised to create a truth commission. Violent crime is widespread, with journalists and political candidates frequently murdered.

While overt discrimination varies by region, class lines closely track racial divisions. Courts have approved same-sex marriage, but not all states have followed the ruling. Corruption is a serious problem in politics, the judiciary and the police. The court system is ineffective particularly at prosecuting powerful individuals.

Governance

#32

Executive Capacity

#30
Despite its strong presidential system, Mexico scores relatively poorly (rank 30) in the area of executive capacity. Its score has fallen by 1.0 points relative to its 2014 level.

Planning has seen a resurgence in popularity, but the outgoing president’s “lame duck” status severely limited progress during the review period. Incoming President López Obrador is repealing several of his predecessor’s reforms. Structurally, the presidential office is dominant, while the Finance and Interior ministries hold considerable power

RIAs are common and of generally high quality, with the agency responsible recently receiving a broader mandate. Ex post evaluations are common. The outgoing president was a poor or even sometimes disastrous public communicator. López Obrador is expected to communicate more effectively, with greater public consultation.

Implementation efficiency is undermined by financial shortcomings, local organizational weaknesses and high crime levels. Monitoring of the police and military has been ineffective. Insufficient funding, corruption and inefficiency inhibit regulation enforcement and the development of national standards. An online platform tracks progress toward achieving the 2030 Agenda for Sustainable Development.

Executive Accountability

#32
With a number of accountability concerns, Mexico receives relatively low overall rankings (rank 32) with regard to executive accountability. Its score in this area has declined by 0.3 points relative to 2014.

The presidential and electoral systems have systematically weakened parliament and its members. The audit office is independent, but has little ability to effect change. The ombudsman is well respected, but its powers are dwarfed by the spread of violence. Data-protection policies are limited in practice, particularly in remote areas, for poor people and where security issues are involved.

Policy knowledge varies by class and education level. Public support for democracy has fallen precipitously, and only small minorities trust elections or political parties. Owners of a large share of the oligopolistic media have ties to politicians. Increasing violence has produced significant self-censorship among journalists, particularly on security-related issues.

Employers’ associations are more sophisticated than trade unions, but tend to be dominated by elites that do not necessarily pursue the interests of their broader sectors. The NGO sector is maturing quickly, and is gaining increasing influence.
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