EVENT ON MONDAY | The State of Mexico’s Economy

mexican pesosWHEN: Monday, January 9, 1:30-3:00pm

WHERE: 6th Floor Board Room, Wilson Center, Washington, DC

Click to RSVP

The Wilson Center’s Mexico Institute is pleased to invite you to an event with the International Monetary Fund’s Mexico team, who will present the conclusions of the recently-completed 2016 Article IV consultation with Mexico.

Mexico’s economy has been growing at a moderate pace, inflation is low, and the unemployment rate has been declining. Fiscal consolidation has begun and the financial system remains strong and resilient to severe shocks. It would be critical to adhere to the planned fiscal consolidation to put the public debt ratio on a downward path, and take steps to strengthen the commitment framework for fiscal policy. Steadfast implementation of the plan to reform PEMEX and strengthen its financial viability is also important. Future monetary policy decisions should continue to be guided by the objective of keeping inflation expectations anchored, while clear communication by the central bank is critical. The exchange rate should continue to act as the key shock absorber to help the economy adjust to external shocks. Significant progress has been achieved in strengthening financial sector prudential oversight but some gaps remain, especially in the governance framework of CNBV and IPAB. On the structural front, strengthening the rule of law and boosting female labor supply would boost potential output and reduce inequality and poverty. Going forward, Mexico will need to navigate an uncertain and complex external environment, with elevated risks of protectionism and heightened global financial market volatility.

Speakers

Robert Rennhack
Deputy Director, Western Hemisphere Department, IMF

Costas Christou
Advisor, Western Hemisphere Department, IMF

Alex Klemm
Senior Economist, Western Hemisphere Department, IMF

Damien Puy
Economist,Western Hemisphere Department, IMF

Fabian Valencia
Senior Economist, Western Hemisphere Department, IMF

Commentator

Christopher Wilson
Deputy Director, Mexico Institute, Wilson Center

Moderator

Duncan Wood
Director, Mexico Institute, Wilson Center

Click to RSVP

Why Leaving NAFTA Would Hurt Tennessee

12/15/2016 The Tennessean

By Mexico Institute Advisory Board Member Lawrence Harrington

flags 3 countriesOpposition to the North American Free Trade Agreement with Mexico was a cornerstone of Donald Trump’s campaign.

Canceling NAFTA and imposing tariffs on Mexican imports is one of the few actions President Trump can take without congressional approval.  Under the agreement he only needs to give Mexico six months’ notice to cancel the agreement. Using emergency powers, the president could then in all likelihood impose tariffs on Mexican imports. Trump mentioned a 35 percent tariff on certain Mexican goods during the campaign.

Read more…

VIDEO | What Does the World Expect of President-elect Trump: Mexico

Director Duncan Wood discusses what Mexico expects of President-elect Donald Trump.

what-does-world-expect-of-trump

WATCH THE VIDEO

READ THE ANALYSIS

WEBCAST TOMORROW: What Does the World Expect of President-elect Donald Trump?

white_house_1500.jpgWHEN: November 15, 11:00 AM – 12:30 PM

Watch via Webcast

Watch the live webcast on TwitterFacebook, or on wilsoncenter.org. Tweet the panel your questions @TheWilsonCenter or post them on our Facebook page during the event.

The next U.S. Administration faces  a complicated, volatile world.

Join us for spirited conversation about the foreign policy expectations and challenges confronting the next President of the United States with distinguished Wilson Center experts on Mexico, Russia, China, the Middle East, Latin America and more.

Introduction

The Honorable Jane Harman
Director, President and CEO, Wilson Center

Speakers

Cynthia J. Arnson
Director, Latin American Program, Wilson Center

Robert Daly
Director, Kissinger Institute on China and the United States, Wilson Center

Robert S. Litwak
Director, International Security Studies, Wilson Center

Aaron David Miller
Distinguished Fellow, Middle East, Wilson Center

Matthew Rojansky
Director, Kennan Institute, Wilson Center

Duncan Wood
Director, Mexico Institute, Wilson Center

Watch via Webcast

 

What President Trump’s Mexico-bashing May Look Like in Practice

11/9/2016 The Economist

ENRIQUE PEÑA NIETO, the president of Mexico, was roundly castigated at home for meeting Donald Trump in August. Mr Trump, then the Republican presidential nominee, is reviled south of the border for calling Mexican migrants rapists, and for promising that he would force Mexico to pay for a wall between the two countries. In his defence Mr Peña said it was important to begin a dialogue early, with a view to reducing the potential harm a Trump presidency could cause Mexico.

That strategy is about to be put to the test. In Mexico the immediate effect of Mr Trump’s victory has been to send the already weak peso tumbling to new lows. Throughout the campaign the currency reacted badly to any perceived improvements in the Republican’s chances of victory. On early Wednesday morning it fell to more than 20 to the dollar—its biggest drop since 1994—on fears about the future of trade with the United States.

[…] Cooperation on matters of security is also of vital importance, and relations in this area are currently better than at any point in the past ten years, suggests Duncan Wood, head of the Mexico Institute of the Wilson Center in Washington, DC. Given that Mr Trump has complained about Mexican drug-traffickers coming into America, the chances of his undermining the very interactions that aim to keep them out are minimal. […]

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A Victim of Trump (and Fundamentals), the Peso Falls

11/14/2016 Forbes.com, Mexico Institute Blog

By Viridiana Rios, Global Fellow, Mexico Institute

pesoI write today as a middle class Mexican whose savings lost 10 percent of their value when American voters elected a leader who pledged to renegotiate NAFTA and tax us to pay for a wall. As a result of the election and other factors, the Mexican peso has overtaken the Argentine peso and the South African Rand to become the emerging markets 2016 worst performer.

The Mexican Peso was a barometer for the presidential campaign. It lost 10 percent of its value when Clinton lost, 1.9 percent in the week after the FBI reignited Clinton’s email controversy, and hit its historical low in the days following the election as speculation turned to the potential impact of Trump’s first months in office. The peso spiked 1.3 percent in less than an hour during the first presidential debate, and when Trump’s lewd conversation about women broke, it gained 2.2 percent.

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NEW PUBLICATION | Growing Together: How Trade with Mexico Impacts Employment in the United States

growing-together-employment-sectionBy Christopher Wilson

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The United States and Mexico trade over a half-trillion dollars in goods and services each year, which amounts to more than a million dollars in bilateral commerce every minute.  With such a large volume of trade, it is not hard to believe that the number of jobs that depend on the bilateral relationship is similarly impressive. New research by the Mexico Institute shows precisely that: nearly five million U.S. jobs depend on trade with Mexico.

The study shows that if trade between the United States and Mexico were halted, 4.9 million Americans from across the country would be out of work.

This essay analyzes the employment impact of bilateral trade on the U.S. economy. Read the essay here.

Key Findings

  • Nearly five million U.S. jobs depend on trade with Mexico… Our model shows that if trade between the United States and Mexico were halted, 4.9 million Americans would be out of work.
  • Many times, it is the availability of cost-efficient inputs that allows U.S. companies to stay competitive enough to fend off competitors from outside the region and to grow exports in the face of fierce global competition. In this way, not just exports but also imports from Mexico help support jobs in U.S. industry.
  • The auto industry, which is probably the single most integrated regional industry, is a perfect example of the benefits of trade integration. Without the availability of nearby Mexican plants to do the final assembly of light vehicles, it is quite possible that the vast U.S. parts producing network for these vehicles would migrate to someplace outside of the continent.
  • Misperception and scapegoating has certainly played a role in creating the current negative political environment around trade…but so has the very real failure of U.S. policymakers to adequately address the challenges facing middle-class Americans.

This essay is part of our project Growing Together: Economic Ties between the United States and Mexico, which explores the bilateral relationship in detail to understand its nature and its impact on the United States. Throughout the fall of 2016, the Mexico Institute will release the findings of our research on our website and social media, using the hashtag #USMXEcon.

Read the essay