The political economy of Mexico has undergone dramatic transformations in recent years. During the 1980s, Mexico experienced a painful economic crisis brought on by the accumulation of massive international debts. Measures taken to restore Mexico's creditworthiness led to renewed international capital flows and modest economic recovery in the early 1990s. The "Peso Crisis" of December 1994, however, led to renewed hardship. As the value of the Mexico's currency, the peso, fell in international markets, investor confidence waned and waves of capital fled the country to safer havens.
The policy steps taken to restore financial stability, including cuts in government spending and higher interest rates, caused massive unemployment and falling wages. Financial assistance from the United States, the International Monetary Fund and other international sources helped to ease Mexico's crisis, but could not forestall it altogether.
Another important feature of recent Mexican economic policy involves the move away from nationalist and statist strategies of development toward a more liberal approach featuring open markets. The North American Free Trade Agreement (NAFTA), among Mexico, the United States and Canada, is the most dramatic product of this new approach. NAFTA, which went into effect on January 1, 1994, lowers barriers to trade and investment among the three participating countries. This has allowed Mexican producers easier access to U.S. and Canadian markets and prompted some American and Canadian firms to relocate production from their home countries to Mexico.
The costs and benefits of NAFTA has not been distributed evenly throughout Mexico. While the Northern portion of the country, with its close proximity to the U.S., has experienced an increase in jobs and investment, the less prosperous Southern states have seen few benefits from NAFTA. Indeed, growing imports of cheap American grain have hurt small farmers in the South. Opposition to NAFTA was cited as one of the motivations behind the Zapatista rebellion that broke out in the Southern state of Chiapas at the beginning of 1994.
Besides the peso crisis and the Zapatista rebellion, Mexico has experienced other signs of political turmoil in recent years. In 1995, two leading officials of the ruling party, the PRI, were assassinated. One of these was Donaldo Colosio, the PRI party's Presidential candidate. After more than sixty years of virtually uncontested rule, the PRI lost its majority in the lower house of legislature in 1996 to a coalition of opposition parties. Opposition politicians now control state governments encompassing more than half Mexico's population and hold mayoral positions in most of the large cities, including Mexico City. These developments symbolize Mexico's gradual democratization and the waning hegemony of the traditionally dominant PRI party.
The annotated photos included here were taken by David Skidmore on
visits to Chiapas and Mexico City during May, 1996. These images provide
selected insights into the difficult political and economic changes Mexicans
are currently experiencing.
Links to Images of Mexico