An important country in the American continent has re-cently had a close presidential election. The final result was eventually disputed in the courts. The outcome has implications reaching beyond the country’s borders.
I am referring, of course, to the other United States. Or, rather, the United Mexican States, as the country known universally as Mexico is formally named.
News of the disputed result of the presidential election held on July 1 made the rounds internationally. Then, the issue largely faded from view. In Mexico itself, the contestation has not fizzled out yet. The consequences may spill over and affect the November presidential election in the younger country to the north of the border.
Mexico often features in US elections, presidential and mid-term, because of the issue of immigration. It is a hot topic on both sides of the border as I could see for myself during my sixth visit to Mexico in 2007 as a member of a European Parliament delegation to an Inter-parliamentary Group meeting.
Mexico receives irregular immigrants from its southern border, Central Americans seeking a better future in Mexico itself or using Mexico as a transit to the US. At the time, US President George W. Bush was trying to sell his immigration package, giving legal status to about 12 million Mexicans who had entered the US irregularly while, at the same time, proposing to build a wall in areas porous to irregular immigrants and sending the National Guard to oversee the border.
My own intervention was made with the southern European border very much in mind. The Mexican delegation was already up in arms when I began to argue that it is the responsibility of the Mexican government not to continue closing a blind eye to irregular immigration across its borders and that, contrary to what was being indirectly suggested, immigration is not a fundamental human right.
Let us say that my determined contribution was admired but not well received.
However, like the previous visits, this one convinced me that it is a caricature of Mexico to reduce its economic identity to migration and violent drug wars with high civilian casualties.
Mexico has a tremendous economic diversity spread over a complex and varied environment. This gives Mexico its distinct character. It has a vast wealth of mineral resources, a limited amount of agricultural land and a rapidly growing population. More than half its 106 million live in the centre while vast areas of the arid north and the tropical south are sparsely settled. While it is true that one third of Mexicans live in small communal villages with very traditional ways of life, more than two thirds live in cities.
Mexico is also such a tourist magnet. From Acapulco in the west, with the death-defying cliff divers, to Cozumel in the east, where swimming with dolphins in turquoise Caribbean is such a thrill. Mexico also has a tremendous cultural background. The Aztec civilisation, still evident in archaeological sites such as Chichen Itza, is truly remarkable.
While prosperity remains a dream for most Mexicans, many of whom try to cross the 3.000-kilometre border for a job in the US, Mexico is a large oil producer with substantial reserves. Every major car manufacturer has a plant in Mexico. All Volkswagens are made in Mexico, not Germany. The ability to export both to the US and the EU without Customs duty on industrial products has greatly raised Mexico’s industrial profile. Indeed, several manufactures from Malta have migrated to Mexico. For the last 30 years, the economy has grown slowly. Over the last two decades, the average GDP growth has been only 2.6 per cent. A far cry from the growth rate of the regional giant, Brazil, and the other emerging economic powers whose company Mexico hopes to join.
In this year’s presidential election, however, economic reform loomed large. The man officially and largely recognised as the winner, Enrique Pena Nieto, offered an economic plan with growth targets of six per cent.
His left-wing rival, Manuel Lopez Obrador, promised an array of increased social benefits, which would be feasible if the country’s narrow tax base (just 22 per cent of GDP) was broadened by reducing the black economy.
There is general agreement by most experts that six per cent may be too ambitious a target. However, the potential for four per cent, perhaps five per cent, is acknowledged. This can be accomplished if Mexico has a determined government, with broad support in the legislature, to reform all those aspects of economic governance that hinder Mexico from achieving its potential. In particular, the monopolies that see Mexicans overcharged (internet costs are almost double those in Colombia) and the oil industry kept back from increasing production.
If the Mexican economy begins to accelerate, the impact on the US job market will be positive. It will help President Barack Obama’s chances of re-election, whereas he is now in a dead heat with his rival Mitt Romney in the polls.
Given the jingoism and militarism characterising Mr Romney’s criticism’s of Mr Obama’s foreign policy, the result of the US election could make as big a difference to Europe and the Mediterranean area as the election that first saw George W. Bush and Dick Cheney end up in the White House.
This means that the final result of the Mexican election, given the nudge it may give Mr Obama, is of some importance to us as well. Mr Nieto is likely to be confirmed victor. But if the selective recount ordered by Mexico’s Electoral Commission increases political polarisation and makes economic reforms more difficult to pass, those difficulties may have a ripple effect and spill over and reach Europe.
Dr Attard Montalto is a Labour member of the European Parliament.