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COMPETITIVENESS
IN MEXICO
Every year, Mexico becomes a better place to do business in. According to the
World Competitiveness Yearbook by the International Institute for Management
Development, Mexico is making progress in its business environment and
improving its advantages for doing business.
by maría cristina rosas*
Mexico –along with Turkey–
made the most sizeable
gains in competitiveness
in 2010, of the 59
countries analyzed in the
World Competitiveness Yearbook 2010-2011
produced by the International Institute for
Management Development (IIMD). The recovery
achieved by Mexico in 2010, after the
dire economical situation facing the world in
2008 and 2009, is good news.
According to the yearbook, the most competitive
countries and/or areas are the US and Hong
Kong (equal top), followed by Singapore, Sweden,
Switzerland, Taiwan, Canada, Qatar, Australia
and Germany. In 2010, Mexico climbed from
47th in the 2009 list, to 38th. Meanwhile, Brazil,
dropped from 38th in 2009 to 44th in 2010.
The IIMD yearbook classifies countries
according to a global competitiveness index
calculated in line with indicators that are
real and perception-based. The former are
hard variables to objectively measure fac-
tors such as a country’s government’s debt.
The latter are variables that arise from surveys
carried out in each country, where actors
in the economic sector are asked about
various factors and about their perception of
how these factors may or may not become
obstacles to doing business.
In the specific case of Mexico, progress
in competitiveness indexes can be explained
thanks to improvements in various indicators.
First of all, the economic performance indicator
ranked it 16th in the list, nine places above
its 2009 ranking. This factor weighs up the
domestic economy, international trade, foreign
investment, employment, and inflation.
The government efficiency indicator rose
to 43rd place, up three spots from 2009. That
factor takes into consideration public finance,
fiscal policy, the institutional and social framework
and business legislation.
In terms of business efficiency, Mexico was
ranked 43rd, climbing eight places from 2009.
That factor assesses business productivity, the
labor markets, the finance sector, management
practices, social attitudes and values.
For infrastructure, the country ranked 49th,
climbing one place from 2009. That factor evaluates
basic infrastructure (water, energy, and
transport), information technologies, scientific infrastructure
(research and development), health,
education and the environment.
As noted above, the criteria that comprises
each factor derives from an objective measurement
as well as from perceptions based
on surveys.
This progress has been made possible by
Mexico’s growing strengths, such as the incorporation
of information technologies, the size
of the country’s internal market, its macroeconomic
stability, a relatively low public debt and
a public deficit that is under control.
Mexico’s proximity to the US market and
its increased competitiveness with the entry
into force of the North American Free Trade
Agreement (NAFTA), have been two major
contributory factors for that success.