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Mexican Economy Research Paper

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Title: Oil prices and its effects on Mexican economy
Students name: Elcherik Daal
Name of the college: Palm Beach State College
Course: Macro-Economics
Name of the instructor: Warren Smith
Date: April 5st, 2015

Abstract
This research paper will describe the demography, labor force and the business cycle of Mexico. Mexico is a federal republic, and it consists of 31 states and the Federal District. The Constitution established separation of powers. The country itself has a perimeter of 761,602 square miles. Mexico underwent an increase in purchasing power living standards, as well as reforms in energy and telecommunications passed by recently elected President Enrique Peña Nieto. Besides the reforms, the manufacturing sector …show more content…

The Constitution established separation of powers, also known as the Trias Politica . Since the president is head of state, government, and the army, it was said that the only constraint placed on the power of a president of Mexico is the time limit of his presidential term. He is allowed to run for six years but isn’t entitled for reelection.
With the consent of the Congress, the president can even intervene in the states, thus restricting their independence. There is no vice president, so if the president dies or is removed from office, Congress would be obligated to elect a temporary president.
To conclude, an advantage of having a president with minimal restraints is that he can govern the country without the obstruction of the Congress. He can pass a bill or reform more easily. His run in the office will be more efficient, contrary to the hardships that US president is currently facing.

Economic system
You can get perspective on the Mexican society and economy by assessing the statistics and demographics of the country. One Mexican peso is equivalent to 0.06$, so you would need 16.67 pesos to buy one American dollar. The Mexican peso has dropped in the 0.02$ in the last five years. With devaluation of currency, the export will increase and the import will consequently decline. As a result, the GDP will …show more content…

The energy reforms will restore an industry that has had a deficiency in technology for quite some times now. US oil companies will lend their resources that the Pemex currently doesn’t have. This is a good opportunity to help boost Mexican oil production, which has been falling for years. “We need resources, technology and knowledge. Therefore, it is important to work with those who do have” (Peña Nieto). Mexico has been a top crude oil supplier to the US. However, its petroleum production has declined in the last decade. The reform opened Mexico’s oil and natural gas sector to international companies that could potentially help Mexico reverse the shortage/lag in the production. Besides US, Mexico has other trading partners like China, Japan, South Korea and Germany (Clare Ribando Seelke). Ultimately, these reforms could create investment opportunities for US companies, and it can expand the US and Mexican energy

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