Maquilla sector in Mexico

In the twentieth century, export–led industrialization fuelled by foreign investment and technology (ELIFIT) has become an economic and social development strategy for many countries of Third World. In the 1950s and 1960s, a group of Latin American and East Asian countries adopted such a strategy and allowed U.S. and European companies to use their cheap labor with the hope that this would lead to economic development. For East Asian countries, originally Hong Kong, Singapore, Taiwan, and South Korea, this strategy worked well and made a substantial contribution for countries' economic development. For Mexico, on the other hand, ELIFIT strategy did bring an economic growth to the country but it failed to convert this growth into development. Why would such a strategy work well for East Asian countries but not for Mexico? Was there anything the Government could've done in order to achieve a better level of development?
Thefirst phase in the maquila industry's brief history began in 1965 with the Border Industrialization Program (BIP). President Diaz initiated the program the year after his Minister of Industry and Commerce visited Asia, where U.S. and European multinational corporations were rapidly setting up assembly plants. Copying the structure of the new export processing zones in Singapore, Hong Kong, Taiwan, and the Philippines, Diaz extended the limited free trade zone to the entire northern border of Mexico. Initially they had to be located within 12.5 miles of the border, but in 1972 the administration of Luis Echeverria eliminated this restriction, prohibiting maquilas only in Mexico's highly industrialized three largest cities: Mexico City, Guadalajara, and Monterrey .
"Maquila" is a word of Arabic origin, meaning the portion of grain or oil a miller receives as payment for the milling.In broader economic terms, it would be an activity in which the owner of the raw material hires …

Leave a Reply

Your email address will not be published. Required fields are marked *