Topic > The Rise of Mexico - 1386

Mexico's economic position remained relatively stable, exhibiting positive growth rates during the first half of the 20th century. Recently, the country has been plunged into a catastrophic storm, in which federal authority has been weakened and overrun by criminal organizations. According to historical and political researchers, the roots of the nation's decline date back to the implementation of neoliberal policy after the 1982 economic crisis. The promises made by the North American Free Trade Agreement (NAFTA) during the 1990s failed to deliver on the their value. value, causing nearly a million Mexican workers to lose their jobs and forcing many into bankruptcy. The result of this calamity has paved the way for criminal organizations to take root in the territory; their numbers grew exponentially, luring the poor with wealth and power. Today, gangs such as the Sinaloa and Gulf Cartels are officially seen as the two parties destroying the state due to their involvement in drug trafficking, prostitution and racketeering. The implementation of NAFTA, initially intended to solve Mexico's financial problems, has thrown the country into a wake of violence and fear, presenting the possible rise of a narco-terrorist state in the near future. Until the Great Depression of 1929, most Latin American countries operated under a system of exporting primary products and importing industrialized goods. The decline of the world economy during the 1930s halted this process, as imports began to become much more expensive due to declining export sales. To counter the problem at hand, these countries have adopted a new model called Import Substitution Industrialization (ISI). This procedure involved the substitution of foreign assets… halves of paper… debt, banks offered a certain deal through Brady Bonds. This agreement consisted of three conditions issued by the banks and investors; allowed bank creditors to grant a relief of funds in exchange for certain guarantees in the form of collateral interest, the debt relief was to be associated with the promise of economic reform, and the resulting loans were to become more marketable, allowing creditors to reduce the risk of exposure . After its implementation, the IMF reported that only 2.7% of Mexico's credit GDP was reduced. In essence, the Brady Plan proved useful to American financial institutions, allowing them to try to raise as much money as possible, so as not to lose the value of the investments made. Millions of lives have been ruined because of the Brady Plan. The crisis and the 1980s were eventually nicknamed la decade perdida – the lost decade.