Summary

Neoliberalism swept over Mexico like a tsunami. It swept away the country’s edifice of economic nationalism and left in its place an economy based on principles of neoliberalism. These neoliberal practices go by the names of the structural adjustment programs (SAPs), or the Washington Consensus. In 1982, when Mexico declared its lack of adequate resources to meet external debt service payments, it (like other Latin American countries) entered into debt renegotiations. These renegotiations required Mexico to implement reforms such as the privatization of state-owned enterprises, currency devaluation, and state budget reductions. Later agreements expanded upon the neoliberal reforms (the 1986 adherence to GATT; the 1992 revision of Article 27 of the Constitution, the 1993 signing of NAFTA, and the 1994 peso devaluation). Multiple iterations of the Foreign Investment Laws opened up Mexico to foreign investors. The goal of the neoliberal adjustments was to stabilize the economy and make it attractive for foreign direct investment. FDI, as well as open trade, promised to bring economic well-being and political stability to Mexico. The evaluations of the post-1982 reforms are mixed, but by the 21st century, tend toward “disappointing.” Increasing globalization has further marginalized Mexico. Neoliberal globalization is essentially about Mexico’s integration into the current global economy and the interaction of the global and the local. Mexico has been integrated into the global economy since Cortez, but the tsunami of neoliberalism has left Mexico with fewer armaments for successful development.