Weekly Graphic: Relative Advantage of
Mexican States
Relative Advantage of Mexican States Map

This map illustrates that two different economies coexist within Mexico. Mexico’s National Institute of Statistics and Geography generated this data by measuring several development indicators, including housing infrastructure, basic furnishings, overcrowding, health, education and employment levels. The higher a state’s overall standard of living, the higher its ranking.

Economic activity in each state correlates with these rankings. Mexico’s central and northern states are home to advanced industry, attract foreign direct investment and/or are
strategically located near strong trade flows associated with the U.S. border. Meanwhile, the southern states’ economies are more dependent on agriculture and primitive industry, with higher numbers of informal, low-wage laborers. Government figures show that from 1980 to 2014, per capita GDP in central and northern states grew by about 50 percent. In the south, this figure increased a mere 9 percent.

In particular, Chiapas, Guerrero and Oaxaca stand out. The share of residents living in extreme poverty in these states ranges from 61 percent to 74 percent. The Mexican government is currently creating the conditions needed to spark growth and has planned special economic zones in Chiapas Port, Lázaro Cárdenas Port and the Isthmus of Tehuantepec, which connects the Gulf and Pacific coasts. Included in the plans are tax incentives, duty-free customs benefits, streamlined regulatory processes, improved infrastructure and better logistical connections to the rest of Mexico.

For economies in the northern and central states to remain robust and the south to further develop, Mexico needs to maintain good trade relations with the United States. About 80 percent of
Mexico’s exports go to the United States and are exchanged within the NAFTA framework. However, the future of NAFTA has been brought into question in the United States, a topic we will further explore in our upcoming Deep Dive.

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