jueves, 29 de julio de 2010

Federal Intervention in the Banking Crisis By Kimberly Amadeo.

The Federal government is spending hundreds of billions of dollars to add liquidity to the financial markets to avoid a complete collapse. Here's a chronology of the how the crisis evolved, what caused it and steps the government has been taking along the way.

November. Citigroup Bailout Critical for Economy to Recover

The U.S. Treasury gave Citigroup a $20 billion cash infusion in return for $27 billion of preferred shares yielding 8% annual return, and warrants to buy no more than 5% of Citi's common shares at $10 per share.

Citigroup Bailout Critical for Economy to Recover
Tuesday November 25, 2008

Many people are wondering why Citigroup should get a bailout, and the Big 3 automakers were told to go packing. After all, both companies made bad strategic decisions - Citigroup in using too much leverage in buying mortgage-backed securities, and the Big 3 in not retooling for more fuel-efficient vehicles. Both have thousands of employees that will be laid off if the companies go bankrupt. Are banks somehow more important to the economy than auto manufacturers?

Perhaps not morally, but financially they are. To get this economy back on its feet, it needs capital more than cars. Banks provide that. However, with last week's 800 point drop in the Dow, banks assets are too low to give them money to lend. That's why the Citigroup bailout included options to buy common stock, which shows government support of common stockholders. This caused the Dow to regain last week's loss in two days. This rally for financial stocks means more capital for banks, and more capital for them to lend.

The U.S. Treasury gave Citigroup a $20 billion cash infusion in return for $27 billion of preferred shares yielding 8% annual return, and warrants to buy no more than 5% of Citi's common shares at $10 per share. More importantly, the Treasury will guarantee $306 billion worth of toxic mortgage-backed securities, helping Citi to get these off of its balance sheet. In return, the bank will absorb the first $29 billion in these losses before the government guarantee kicks in. Citi also received $25 billion last month under TARP. (Source: Barron's, A Tale of Two Cities, November 25, 2008)

Obama's $500 Billion Bailout Plan
Wednesday November 26, 2008
Barack Obama

President-elect Barack Obama announced a Economic Stimulus Plan that could run between $500-$700 billion over the next two years. The plan includes creation or retention of 2.5 million jobs through a $25 billion public works construction program, a $3,000 tax credit to businesses for each new hire, and $50 billion to auto companies for retooling to produce energy efficient vehicles.
What It Means to You
Many people are worried that the billions of dollars being pumped into the economy by government stimulus plans will lead to hyperinflation. That is not a concern right now, since deflation is a greater risk. The credit crisis was caused by over-leverage, and the winding down of that leverage has caused a 27% decline in housing prices and more than 40% decline in the stock market. These are not captured in the government's inflation report. Once the economy is back on its feet, Obama and the Fed can enact measures to stem inflation.

Fed's $800B Plan Lowers Mortgage Rates
Thursday November 27, 2008

The Federal Reserve will spend $800 billion to purchase mortgage-backed securities from Fannie Mae and Freddie Mac, as well as consumer loans. The Fed will purchase $100 billion in consumer loans next week, and $600 billion in mortgage-backed securities by year end. As a result, rates for a 30-year fixed mortgages fell to 5.5% from 6.38% Wednesday morning. (Source: Barron's, The Fed Tries to top TARP, November 26, 2008)
What It Means to You
The Fed was successful in spurring commercial bank lending with the Commercial Paper Facility several weeks ago, although activity has stabilized. Mortgage applications should start to rise, as well, since Fannie and Freddie will have unloaded some of their debt and will be free to make new loans. However, the questions remains as to how much demand is there for mortgages.

However, if you are facing an interest rate reset and higher monthly payments, now would be a good time to refinance to a fixed-rate loans. Even though LIBOR rates have come down from earlier summer highs, there is still a lot of volatility in financial markets, and it is better to be safe than sorry.

Economy Slowed in Q3 Slightly More Than Original Estimate
Sunday November 30, 2008
Q1 GDP Growth

The BEA preliminary report for the U.S. GDP growth rate for Q3 2008 was a negative.5%, down slightly from the advance report estimate of .3% decline. However, it represents a substantial decline from the 2.8% growth in the second quarter. The decrease was due to the first decline in consumer spending since 1991 and the biggest drop since 1980. The slowdown in growth would have been worse without increased government spending. (Source: GDP News Release)
What It Means to You

This is the second quarter of negative GDP growth in a year, thereby confirming for me that we are in a recession. The definition of a recession is when GDP growth is negative for two or more consecutive quarters. However, the 2001 recession was pretty bad, and did not see any consecutive quarters.

Furthermore, most economists are predicting that the next quarter will be negative, so I am just calling the official recession one quarter early. The last negative quarter was Q4 2007, which was down .2%.

Growth for 2007 was 2%, down from the 2006 growth rate of 2.8%. This decline in growth has been due to the housing market slowdown and related weak consumer spending. For a review of the most recent GDP reports, see GDP Current Statistics

Durable Goods Orders Down 10% From Last Year
Tuesday December 2, 2008

The October Durable Goods Orders Report shows that manufacturers are struggling due to the slow economy. The Census Bureau reported that business orders for machinery, computer equipment, and the like decreased 9.9% in October when compared year-over-year. (Source: Census Bureau, Report on Manufacturer's Orders, Advance Report, Table 1, seasonally adjusted figures)

Why are durable goods orders so important? Since they represent the orders for big ticket items, businesses will hold off making the purchases until they are confident in the economy. Therefore, decreasing orders mean decreasing production, which has led to a slowdown in GDP growth. That's why the Durable Goods Order report is generally considered one of the more important leading economic indicators.

By the way, most articles you read compare this month to last month, which showed a 6.2% decline since September. However, year-over-year comparisons do a better job of predicting the GDP report, which is also year-over-year. (See Durable Goods Spreadsheet in Google docs)
What This Means for You
The current credit crisis has slowed foreign economies, which has slowed orders for U.S. exports. This has contributed to our current recession . Continue to watch the important economic indicators to see how long the economy will remain in this slump.

Volcker Best Pick for Obama Economic Advisory Board
Wednesday December 3, 2008

Former Federal Reserve Chairman Paul Volcker (1979-1987) was recently appointed by President-elect Barack Obama to head his Economic Recovery Advisory Board. Volcker's aggressive action against double-digit inflation in the late 1970's has reassured the markets that he will take an equally tough stance to combat the current recession. Volcker has blamed poor financial regulation for the current crisis, and will probably advocate tougher restrictions. He will play a key role in shaping the new board with independent-minded leaders from business and academia.
What It Means to You
As Federal Reserve Chairman, Volcker raised the Fed Funds rate to 20% and kept it high until he saw that inflation was in check. Thanks to Volcker, economists and central bankers now realize that managing inflation expectations is the most important way to manage inflation. The same is true for deflation. Volcker will advocate aggressive action to restore business and consumer confidence, which will help in shortening the recession. (Source: Bloomberg, VVolcker to Lead New White House Panel, November 26, 2008)

miércoles, 28 de julio de 2010


This is a tutorial posted on wiziq bye Marian Heddlesheimer

Documents needed to ship your product to Mexico

Documents needed to ship your product to Mexico
Mexico Data On-Line

Importers will use a customs broker (a private-sector provider of services) of choice to obtain release of the merchandise. The customs agent will provide to importers all necessary information relating to applicable duties and non-tariff regulations. The customs entry will be accompanied by:

* the commercial invoice, when the customs value of the merchandise is determined in accordance with transaction value and exceeds US$300,or the equivalent in another foreign currency (the invoice will be prepared in Spanish -- in cases where it is not, a translation may be prepared on the reverse or in the body of the invoice);
* the bill of lading or airway bill of lading, endorsed by the transport company;
* documents evidencing compliance with requirements relating to restrictions and non-tariff regulations that apply to the importation;
* proof of the country of origin, and country of export, as appropriate; and
* the document demonstrating guarantee for the payment of additional amounts that may arise if the declared value is less than the estimated price established by the Secretary of the Treasury and Public Credit for the merchandise which has been undervalued.

Commercial invoices are not required for imports and exports made by foreign embassies and consulates or by their officials and employees, relating to electric energy, crude petroleum, natural gas, and their derivatives when made by pipeline, or for personal effects. The importer will present a declaration in writing and under oath for the customs officials, with those elements that permit determination of the customs value of the merchandise. A copy of this declaration will be given to the customs broker or attorney to use in determining the customs value on the entry.

The customs agent prepares the import entry using information provided by the importer and pays monies owed to the private bank located within customs. The customs broker then presents the merchandise, accompanied by the previously paid customs entry, to the mechanism for random selection for examination.

The customs official activates the mechanism for random selection, which determines whether or not the shipment will be examined. If the shipment is designated for review, the examination will be made within a period not to exceed three hours. This period may be longer when discrepancies are discovered. If the shipment is not designated for review, it will be released immediately so it can proceed to its destination.

Importers will retain documentation that proves the legal importation of the merchandise, in case the fiscal authorities require clarification after customs clearance.

>Source: North American Free Trade Agreement: A Guide to Customs Procedures., Jointly produced by Customs Administrations of the United States, Canada and Mexico, January 1994.
For Additional Assitance

International freight forwarders act as agents for exporters in moving cargo to foreign destinations, including Mexico. These agents are familiar with the import rules and regulations of Mexico, methods of shipping, U.S. government export regulations and the documents connected with foreign trade. Freight forwarders can assist with an order from the start by advising the exporter of the freight costs, port charges, cost of special documentation, and insurance costs as well as their handling fees -- all of which help in preparing price quotations.

For a referral to international freight forwarders in your state, you can contact the National Customs Brokers and Freight Forwarders Association of America at (212) 432-0050 begin_of_the_skype_highlighting (212) 432-0050 end_of_the_skype_highlighting. For information on contacting a Mexican customs broker (if your Mexican customer hasn't already indicated a preference), you can contact the Confederacion de Asociaciones de Agentes Aduanales de la Republica Mexicana (Confederation of Mexican Customs Brokers) at 011-525-533-0075, 011-525-533-0076, 011-525-533-0077, 011-525-533-0683 or 011-525-533-0684; Fax: 011-525-525-8070.

NOTE: For specific information on documentation requirements for shipping products to Mexico that qualify for NAFTA preferential tariff treatment under the NAFTA rules of origin, see NAFTA Facts documents 5001, 5002 and 5003 on the NAFTA Certificate of Origin.

jueves, 22 de julio de 2010


Mexico Economy
Mexico is a federal constitutional republic in North America, bordered by the United States on the north and by Belize and Guatemala on the south-east. The south and west is flanked by the Pacific Ocean and the Gulf of Mexico on the east. Mexico’s has an estimated population of 111 million, and its economy is the 13th largest in nominal GDP terms ($1.143 trillion -2009) and the 11th largest by Purchasing Power Parity (PPP, $1.563 trillion – 2009). Furthermore, Mexico’s economy is part of the North American Free Trade Agreement (NAFATA), a trilateral trade bloc in the region comprising of the US, Canada and Mexico.
Mexico Economy: Profile
Mexico has benefited from the NAFTA; being a free market economy, it has increased its trade with the US and Canada threefold. Furthermore, over 90% of their trade falls under twelve free trade agreements spanning more than 40 countries worldwide. The Mexican GDP grew at an average rate of 5.1% during 1995-2002. The recent economic recession and more specifically, the downslide in the US markets impacted this growth in a negative way. The annual average growth for the GDP in 2005 dipped to 3-4.1%.
In 2009, the economic profile for Mexico took a turn for the worse. Widespread disease in the form of a flu outbreak added to the failing economy in 2009. Policy stimulus proved inadequate against the background of limited fiscal stimulus and monetary relaxation. From an all-time low rate of annual inflation of 3.3% in 2005, this rate has only recently displayed signs of reducing from 6.4% in 2008 to 5.4%. These fluctuations are largely caused by the economy of Mexico’s close association with US business and trade.
Recovery Process: Mexican Economy 2010
For the year 2010, the growth figures pertaining to the Mexican economy indicate signs of a recovery. The Mexican Finance Ministry has increased the growth figures from 3% to 3.9%. This upswing was the result of significant improvement in Mexico’s exports, automobile production, manufacturing and increased imports of consumer goods. Employment
is also on the rise alongside an increase in foreign and domestic demand, despite a deep divide in economic distribution, where 32% of the top earners take in 55% of the country’s total income.

Mexico - Fast Facts
Mexico is an Upper Middle income economies coming under the Latin America
and Caribbean region as to the classification made by the World Bank on the basis of income and region for the year 2006.
has a free market economy system. Exports sector of the country's economy has brought tremendous economic success in the recent years. Services constitute a larger share in the total GDP of the country followed by the industries.
Major agricultural products of the country are wheat, sugar, coffee, and cotton. Important industries are chemicals, electric goods, tourisms, textiles, and rubber. The country has larger deposits
of the various minerals such as zinc, lead, manganese, bauxite and uranium.

Foreign Direct Investment in Mexico

Mexico is a populous Latin American nation. It possesses an open trade regime thanks to the North American Free Trade Agreement (NAFTA). Foreign direct investment
in Mexico is reported to have recorded a 21% increase in the year 2007. It amounted to US$23.2 billion or €15.7 billion. This was the second highest in the country's history. It was only next to the US$29.5 billion investment made in 2001.

About half of the FDI investment to Mexico came from USA. Holland and Spain followed suit with an investment percentage of 15% and 10% respectively. FDI inflow within September 2007 for Mexico amounted to $18.4 billion. It was 30.3% higher in comparison to figures for the same time period in 2006. Half of the capital investment in the form of FDI was meant for the manufacturing sector. It implied an increased availability of remunerative jobs for the Mexican populace.

Analysts have considered 2008 to be an irregular year with the US economy suffering from multiple effects of recession. It may be noted that, Mexico is highly dependent and interlinked with the US economy through various trade relations.

Mexico's expected foreign direct investment stands to the tune of $20 billion for 2008. This is a scaling down from the 2007 estimate of $23 billion.
FDI Trend in Mexico, Performance during the 1990s
In this era the focus was on foreign direct investment is normally executed through the engine of TNCs or transnational corporations. The share of global FDI flows destined for Latin America increased from 32 % in the year 1990 to 43% in the year 1998. Most of these were meant for the Latin American countries like Argentina, Mexico, Brazil and Chile.

A host of factors were responsible for this increased inflow of FDI to these Latin American countries in general with particular reference to Mexico.

Prime among them was the countrywide implementation of privatization policies and programs of debt conversion. Other important policy changes that were effected involved trade able sector liberalization repeal of restrictive FDI regulations regarding issues like profit repatriation, need for prior authorization for investments and various sectoral regulations.

In addition to the above deregulations, the fairly good performance of various macroeconomic stabilization measures for the Mexican economy boosted the confidence of foreign as well as domestic investors in the country's economy.

It may be noted that FDI inflows are crucial for the modernization of the Mexican economy. It is also considered to be one of the employment generating avenues for the Mexican economy.

It may be noted that, robust FDI flows into Latin America in recent years were propelled mostly by Greenfield investments, which comprise expansions and new investments in place of cross border merger and acquisitions.

This trend was a reflection of the robust local economic growth and high corporate profits (earned mostly due to a commodity price hike).

Analysts estimate that, Mexico might register an increase in its FDI in recent future if the country persists with its policy of opening up the domestic telecommunications sector to foreign investment.

As per the estimates of an analyst, in the coming 4 years Mexico may register FDI to the tune of $7 billion yearly from foreign telephone companies in the arena of telephone line businesses with fixed lines.

Mexico Economic Stimulus Package

In January 2009, President Calderon, in order to prevent layoffs, has added $150 million in Mexican economic stimulus package. Mexican central bank
has cut its lending rates from 8.25 percent to 7.75 percent. Inflation of 6.5 percent in 2008 is expected to reduce to 5.4 percent in 2009 and down to 3 percent in 2010. Mexican ‘peso’ has been badly affected because of decreased oil exports to United States, main trading partner of Mexico.

A Mexico economic stimulus package of $5.6 billion had been announced by their President Felipe Calderon in March 2008. This economic stimulus package in Mexico is being provided in form of utility rates discounts, tax breaks and spending programs. In its efforts to strengthen domestic economy, national government has planned new investments in infrastructure development, housing, agriculture and diversification of exports in economic stimulus package of Mexico.

Agustin Carstens, finance minister of Mexico had estimated a growth rate of 2.8 percent in 2008 as compared to 3.7 percent in 2007. This reduced growth rate is due to a devastating money market and economic slowdown of neighboring United States. Present financial situation in Mexico calls out for an economic stimulus package for Mexico to be provided immediately.

Companies have been given an income tax relief of 3 percent and a reduction of 20 percent in electricity rates as part of economic stimulus package to Mexico. These companies are also provided with certain compulsory payroll benefit options. Mexican state owned oil company, Pemex Oil would increase spending by $935 million in way of repairing its old pipeline network.

Felipe Calderon has said while declaring Mexico economic stimulus package that economic performance of United States of America, its major trading partner has been well nigh unimpressive. Housing sector and financial sector of United States of America have been hit hard by global financial recession and this has in turn affected Mexico as well.

In 2008 finance ministry of Mexico had lowered its estimate of growth for that year to 2.8 percent and this was lesser than 2007 when 3.7 percent had been predicted. This has increased importance of Mexico economic stimulus package.

Mexico Economic Review

As per latest Mexico economic review national economy has depreciated at a rate of 2.41 percent in December 2008 compared to December 2007. Much of this has been owing to ongoing financial crisis all over world as well as disturbances in service sector of Mexican economy.

According to Mexico economic reviews by national statistics agencies volume of economic production in December 2008 has been 3.42 percent lesser compared to November that year. This data has been calculated on a basis of seasonal adjustments.

Recent economic review of Mexico has revealed that experts of Mexican goods and services to United States of America have gone down to a significant extent. Consumers in USA have stopped buying goods from Mexico such as cars and televisions.

It has also been confirmed by fresh economic review in Mexico that in December 2008 amount of industrial production has gone down at a rate of 5.9 percent when compared to December 2007. This statistic takes into account production in oil and gas industry and manufacturing sector of Mexican economy.

Latest economic review at Mexico reveals that various manufacturing industries in Mexico have been feeling aftereffects of global financial downturn to maximum extent. This sector has had to do away with jobs of a number of workers and outlook of consumers towards this industry has been really negative of late. In December 2008 service sector of Mexican economy depreciated at a rate of 1.8 percent.

Agricultural sector is a comparatively smaller sector of Mexican economy. New Mexico
economic review has revealed that it has appreciated at a rate of 15.8 percent. As per latest Mexico economic review on February 25th 2009 peso has depreciated to a significant degree. This is an ominous sign for Mexican economy.

Noted economists and financial analysts
, after their Mexico economic review, have said that Mexico’s economy is suffering grievously as a result of economic turbulences in USA. Its stock markets are being affected as well. This is because USA purchases 80 percent of all goods and services exported by Mexico. This global financial catastrophe kicked off in August 2008 and since then peso has lost 33.3 percent of its worth with respect to United States dollars.

Mexico Economic Growth

Mexico economic growth is marked by GDP purchasing power parity, which was estimated to be $1.578 trillion in fiscal year 2008. Official exchange rate of GDP of Mexico, 2008 was $1.143 trillion. There was 2 percent real growth rate in Mexico GDP of 2008. Per capita (PPP) GDP as was anticipated in 2008 was $14,400.

In year 2008, Carstens anticipates that Mexico’s GDP will expand by 4 percent. This growth can be achieved if problems in US housing and credit markets are settled. From fourth quarter of year, Mexico economy will start to look up. Housing market of US will have recovered and it is also assumed that industrial output will increase. This would lead to substantial economic growth in Mexico.

In 2009, it is expected that there will be 0.6 percent economic growth at Mexico but financial crunch and credit crisis can make Mexican economy weaker and thus it can not match assumption of growth that is expected. So, while according to assumptions, when there can be an expansion in Mexico economy by 2.3 percent in 2008, in contrary there can be slowdown in Mexico economy by 1 .6 percent in 2009.

Economic growth of Mexico is evident at various sectors of Mexico economy. Different sectors of economy of Mexico contribute differently. In fiscal year of 2008, agricultural sector had contributed about 3.7 percent, whereas it was 34.1 percent for industry. Service sector contributed 62.2 percent to Mexico gross domestic product.

Regional GDP was 25.7 percent in 2008, while GDP per head has been calculated to be 8,315 US$. Mexico has a free market economy, which is a blend of modern and old fashioned industry and agriculture, which is dominated by private sector. In recent years, there has been economic growth of Mexico development is found in natural gas distribution, electricity generation, airports, seaports, railroads and telecommunications.

For Mexico economic growth, government has taken various steps to upgrade infrastructure of country. Tax system and labor laws and decline of inequality in income are main areas of focus for improvement by government. 16 largest companies of world are located in Mexico itself. Tax, pension and judicial reforms were there in Mexico. Currency policy and monetary system also help in the Mexico economic growth and contribute to Mexico GDP.

Mexico Economic Development

Mexico economic development is high on agenda of Barack Obama as he wants number of illegal immigrants in USA to go down. One way of achieving this, according to him, is to help with economic development of Mexico.

Among higher levels of Mexico governance it is believed that in 2009 exports of Mexico to USA would come down to round about 80 percent of what they were in 2008. This is supposed to have a serious impact on economic development of Mexico. Much of this could be attributed to present global economic conditions

Antonio Oscar Garza Jr. who is working in capacity of American ambassador at Mexico is optimistic that world financial crunch of 2009 would not affect long term potential for economic development in Mexico.

An important aspect of economic development in Mexico is making sure that flow of labor stays uninterrupted in northern region. Flow of capital to southern region of Mexico has to be kept steady as well so that national economy keeps functioning.

Much of economic development at Mexico hinges on reforms that are to be put to effect in energy sector. These reforms are supposed to address various critical issues within Mexican economic system.

As far as labor force of Mexico is concerned, immigration is a matter of major concern – one that can actually hurt Mexico’s economic development. This is a matter that is being discussed at higher levels at both Mexico and United States of America for some years now and a workable solution is still to be arrived at by these two parties.

Mexico economic development has also been helped to a great extent by various Free Trade agreements it has signed over years. In this respect North American Free Trade Agreement or NAFTA has benefited it to a significant extent.

As per economic predictions, 2009 is going to be a detrimental year as far as Mexico economic development is concerned. Much of this would be as a result of falling demand of petroleum and related goods throughout this year.

Manufacturing exports are also supposed to come down in 2009. This would be hugely significant in diminishing prospects of Mexico economic growth. Prices raw materials have been taking a turn for worse and this is a bad omen for economic development of Mexico

Mexico Economic Forecast

As per latest news on Mexico economic forecast Banco de Mexico, which is central bank of Mexico, has reduced its predictions on growth prospects of national gross domestic product. It has been learnt that as per new Mexican economic forecast by central bank of Mexico its national economy would be depreciating at a rate of 1.8 percent in fiscal 2009.

Much of economic forecast of Mexico is premised on its export scenario that has been weakening at a steady rate since recession hit United States of America, which is its principal trading partner and major buyer of goods and services. In USA demand for goods and services made in Mexico has been falling at a steady rate.

Latest economic forecast in Mexico has also confirmed that any deductions in rates of interest by central bank of Mexico would be based on how inflation over there shapes up to be in coming months.

Fact that economy of Mexico had depreciated at a rate of 1 percent in final quarter of 2008 fiscal has contributed to present economic forecast at Mexico. Previously in its economic forecast for Mexico, central bank had prophesized that rate of growth of gross domestic product of Mexico in fiscal 2009 would be ranging from 0.5 to 1.5 percent.

Newest economic forecast for Mexico has confirmed that if any excess expenditure is made for reviving Mexican economy it would be done only if inflation is equal to forecasts that had earlier been made in this regard.

It has also been said as part of Mexico economic forecast that in 2009 fiscal there would not be too much of a slowdown as far as rate of inflation is concerned. In 2008 fiscal rate of inflation in Mexico was 6.53 percent.

This Mexico economic forecast would mean that central bank of Mexico would not be cutting down on its rates of interest in 2009 fiscal. Inflation is a major issue behind this decision of apex bank of Mexico.

National currency of Mexico, peso, has depreciated at an unprecedented rate in March 2009. This has been third straight day that this has happened and as per many a Mexico economic forecast situation is only going to get worse in days to come.

Indo-Mexico Economic Relationship
Mexico is special in terms of its relations in the International scenario. Presently it is a member of the world's largest economic area NAFTA and has a free trade agreement with the European Union. It has FTAs with some 30 countries, including some countries of Central and South America.
Mexico was the first Latin American country recognizing India better. Jawaharlal Nehru sent his sister Vijayalakshmi Pandit as India's first ambassador to Mexico.
The Prime Minister Rajiv Gandhi had visited to Mexico in the late 1980s was joint activism on the disarmament front. India's nuclear tests in May 1998, however, generated some political distance from Mexico, which swears by nuclear disarmament. Equally significant have been the differences on UN Security Council expansion.
As two major emerging economic powers and inheritors of a strong diplomatic tradition, India and Mexico are now well on the way to doing a lot more together on the world stage.
Though there is an overall economic slowdown, including trade stagnation over the last three years still, Indo-Mexican bilateral trade has been growing at a remarkably stable rate. In the year 2003, Indian exports to
">Mexico are expected to cross US$ 530 million, registering a growth of over 16%. Mexico has already regained its position as the top destination for Indian exports to Latin America. Though Mexican exports to India, mainly crude, have also increased substantially over the last three years, the net balance still remains in favour of India. Indian exports basket to Mexico having high substantial potential for future expansion is pharmaceuticals; gems & jewellery; power sector equipment and auto parts. The services sector, mainly IT and software, also offers tremendous future scope.
The Major difficulty behind the promotion of trade between the two nations is geographical distance, lack of direct shipping facilities, expensive credit, language barrier and absence of interest among Indian companies to explore long-term linkages. For enhancing the trading between the two nations an important step in this direction was the offer of a unilateral line of credit for an amount of US $ 10 million by the Exim Bank of India to its Mexican counterpart, Bancomext, for promoting bilateral economic and trade relationship.
Mexico represents a large, stable and growing market both for trade and investment. Investments made by persons of Indian origin in Mexico for the period 1994- 2000 amounted close to US $ 1600 million in nearly 50 joint ventures. These investments are generally dominated by investments in the steel sector. Mexico's FTAs with a large number of important trading partners can help Indian companies in achieving better market access by way of joint ventures and investments).
Present Policy Initiatives
A number of bilateral policy initiatives are undertaken currently for enhancing the bilateral trades between the two nations. Both the countries are trying to establish a joint business group to keep the business community fully engaged in the future planning. The Exim Bank of India has extended a credit line of US$ ten million for promotion of Indian exports and projects to Mexico.
Mexico is already the largest destination for Indian exports in Latin America with a steady upward trend. The strength of this market is its stability. Though commodity trade would remain as a major activity in the short-term still, the Indian
businessmen would be well advised to explore long-term linkages by way of joint ventures and investments.

Mexico Trade, Mexico Exports, Mexico Imports

Mexico is the world’s 11th largest economy. It is known for being a free trade economy that is heavily geared towards exports. Mexico’s trade is based on free trade agreements with more than 40 countries, including Japan, Israel, EU and various Central and South American countries.

Mexico Trade: Exports & Imports under NAFTA
Mexico’s main free trade agreement involves a trilateral trade bloc between Mexico, the United States and Canada. This agreement came into force in 1994 and immediately brought about the elimination of tariffs on more than half the goods imported into the US from Mexico and roughly one third of all goods exported to Mexico from the US. The ultimate aim of the agreement is to completely eliminate US-Mexico trade tariffs within a period of 10-15 years. Meanwhile, the agreement also accounts for 50% of all Mexican exports and 45% of its imports.
The countries that Mexico imports from include:

• United States: 44.3%
• China 5.5%
• Japan: 4.1%
• South Korea: 5.3%
• Brazil: 31.5%
• Chile: 9.3%

Oil is Mexico’s main export and the largest generator of foreign income in the country. Mexico is the sixth largest oil producing country in the world, producing 3.7 million barrels daily. In fact, the production of oil is regulated by the Mexican government with private companies handling the production and shipping of oil.
Besides oil, Mexico exports the following goods to other countries:

• Electronics
• Automobiles
• Aircraft
• Silver
• Computers
• Fruits
• Processed foods
• Vegetables
• Ships
• Coffee
• Electricity
• Biotechnology
• Cotton
• Cellular phones
• Metals
• Industrial equipment
• Firearms
• Aluminum
• Information technologies
• Silicone
• Gold

Automobile exports from Mexico are another main revenue earner for the country. Many major automobile manufacturers are located in the country, such as General Motors, Ford, Chrysler (who have been in Mexico since before the Second World War), along with Volkswagen, Nissan, Honda, Mercedes-Benz and BMW. With an infrastructure that can support R&D, as well as manufacture of components and ancillary industries, many Asian automobile manufacturers have recently set up shop in Mexico.

Mexico Industry Sectors Poised for Growth in 2010

Mexico’s main industries are tobacco, chemicals, iron and steel, textiles, automobiles, consumer durables and tourism. Its close proximity to the US also makes it a strategic location for the development of Mexican industry sectors such as manufacturing, aerospace and automobile. These sectors look poised for growth in 2010. Roughly 90% of the revenue generated from exports is earned from various Mexican industry sectors.
Mexico Industry Sectors: Manufacturing
Manufacturing has steadily grown despite the ups and downs of economic tide, as evident in the 1994 Peso devaluation crisis, the 2001 Latin America downturn and recently, the late-2000s American economic recession. On average, manufacturing increased 2.3% in the 1980s, 3.9% during 1988-98.
Companies from United States started setting up in Mexico because it has the raw materials, besides, low duties under Mexico’s free trade agreements which make manufacturing in Mexico an attractive proposition. Manufacturers have also graduated from simple assembly to research and development of components. It also makes an excellent option to China for foreign firms looking for less expensive markets than their own.
Automobile manufacturing is one of the most important industry sectors of Mexico’s industry. Amongst those who have already set up operations in Mexico are:

• General Motors
• Ford
• Chrysler
• Totyota
• Honda
• Volkswagen
• Mercedes-Benz

Automobiles are the second largest export category from Mexico, so is the aerospace industry. In the aerospace industry, most of the players are foreign firms such as MD Helicopters and Bombardier. Between 2005 and 2010, the number of aerospace companies in Mexico went up from 61 to 193.
Mexico Industry Sectors: Maquiladoras and the Future
The re-export industry is an interesting development. Some 3000-odd factories situated next to the US border (called ‘maquiladoras’) assemble goods that are brought in from the US under contract and these are exported back to the US duty free. The closest competitor Mexico has in this field is China; in terms of lower costs. In spite of the fluctuations, US companies are expected to invest over $2.5 billion in Mexico in 2010, generating 30% more jobs locally.

Recovery Process: Mexican Economy 2010
For the year 2010, the growth figures pertaining to the Mexican economy indicate signs of a recovery. The Mexican Finance Ministry has increased the growth figures from 3% to 3.9%. This upswing was the result of significant improvement in Mexico’s exports, automobile production, manufacturing and increased imports of consumer goods. Employment is also on the rise alongside an increase in foreign and domestic demand, despite a deep divide in economic distribution, where 32% of the top earners take in 55% of the country’s total income.

Mexico’s Economic Structure & Recession

The 11th largest economy in the world, Mexico’s economic structure is largely influenced by it’s free trade stance. Over 90% of trade in Mexico is conducted under free trade agreements it with more than 40 countries. Mexico’s main free trade agreement, the North American Free Trade Agreement (between Mexico, the United States and Canada) accounts for 50% of all Mexican exports and 45% of its imports. Recent developments in infrastructure, industrial and service sectors of the Mexican economy have increased the appeal of Mexico as a manufacturing and outsourcing business hub.

Mexico Economic Structure: Primary Sector
By 2000, agriculture in Mexico contributed as less as 5% to the country’s GDP. Mexico main agricultural products are:

• Corn
• Rice
• Cotton
• Coffee
• Fruit
• Beef
• Poultry

Dairy products
• Wheat
• Soybeans

In 2009, Mexico exported goods worth $4.7 billion to the US alone. Free trade has led to more competition in the country. Globalization has brought to light several issues pertaining to:

• small-scale production
• inadequate infrastructure
• absence of credit
• communal land ownership

Mexico Economic Structure: Secondary Sector
Automobile manufacturing is one of the growing sectors in Mexican economy. Mexico is the biggest exporter of cars to the US. GM, Ford and Chrysler have been operating out of Mexico since the 1930s. Further, Volkswagen, Nissan, BMW, Honda, Toyota and Mercedes-Benz have also set up base in Mexico.
Maquiladoras are foreign-owned Mexican factories that are engaged in labor-intensive assembly of goods. Roughly, 100 new Maquiladoras spanning automobile, aeronautics, electronics, metal and mechanical works and alternative energies, are slated to begin production in 2010. This will help the Mexican economy to recover the 118 thousand jobs that it lost during the 2009 economic recession.

Mexico Economic Structure: Tertiary Sector
Services generate 70% of the Mexican GDP and employs over 50% of the workforce. They comprise primarily of tourism, transportation, commerce, hospitality and food services, healthcare, finance and banking, telecommunications, defense and public administration.
Mexico also has the largest Latin American service sector but there are some difficulties that need to be tackled in this sector. Tourism fell by 17.1% in 2009, transportation and storage by 10.4%. The recession too, saw demand for goods drop and unemployment soar. While the 2010 growth forecasts for the Mexican economy is back on track, up from 3% to 3.9 %, this increase is based on the increase in foreign and domestic demand.

Mexico Housing Recovery Signals Gain for Homebuilders
Jens Erik Gould & Jonathan J. Levin - Bloomberg
go to original
July 13, 2010

Consorcio ARA SAB Chairman German Ahumada Russek says the 2009 recession caused revenue at the Mexican homebuilder to stall. As the economy improves this year, he expects total sales will increase 10 percent.

“There’s practically no inventory in Mexico City,” said Russek, chairman of the country’s third-largest homebuilder by market value, in a telephone interview from the Mexican capital two weeks ago. “People are definitely a lot more optimistic now that employment is recovering.”

Homebuilders are poised to rally as Mexican jobs rise to a record and government-subsidized mortgages boost demand, according to Alejandro Garza, a money manager at Emerging Markets Management LLC, and Ben Laidler, head of Latin America strategy at JPMorgan Chase & Co. This year through yesterday, the Habita index of six Mexican homebuilders including ARA, Urbi Desarrollos Urbanos SAB, Desarrolladora Homex SAB and Corporacion GEO SAB has fallen 15 percent, more than the 0.8 percent drop in Mexico’s benchmark IPC Index.

“We are very bullish on the housing sector,” said Garza, who helps manage $12.7 billion in equities at the Arlington, Virginia-based company. “The uptick in the domestic economy should also be very favorable for the homebuilders.”

Jobs may surpass the record 14.48 million this month, Labor Minister Javier Lozano said, as Latin America’s second-biggest economy recovers from a 6.5 percent contraction in 2009, the steepest slump since the 1930s. Mexican Finance Minister Ernesto Cordero said in an interview last week that the government may increase its 4.1 percent growth forecast for this year.

Year’s Job Growth

Mexico added 513,373 jobs in the first half, reaching the central bank’s forecast of 500,000 to 600,000 new positions for all of 2010, after losing 181,271 positions last year. The data in Mexico include only jobs that guarantee pension and health benefits and require workers to contribute to the housing agency.

Economy Minister Gerardo Ruiz Mateos said in an interview last month that Mexico probably will add about 750,000 jobs this year by boosting manufacturing sales to the U.S., which buys about 80 percent of its exports.

Joblessness in Mexico declined to 5.1 percent in May after reaching 6.4 percent in August 2009, the highest since records began in 2000. In Brazil, the unemployment rate rose to 7.5 percent in May from 6.8 percent in December, the lowest since records began in 2001.

The Habita index was trading at a 19 percent discount relative to the IPC index yesterday. The two indexes on average traded at a similar valuation during the past five years.

Impatient Buyers

The MSCI Mexico/Consumer Discretionary Index, which includes Homex and Urbi, will outperform the broader IPC index this year, said JPMorgan’s Laidler. The IPC will rise 20 percent to 38,500 by year-end, he said. He doesn’t have a forecast for the Habita index of homebuilders. Urbi will gain 51 percent to 37 pesos by the end of the year, Laidler forecasts.

Urbi rose 1.2 percent to 24.45 pesos at 9:37 a.m. New York time in trading on the Mexican stock exchange. Homex advanced 0.3 percent to 57.80 pesos, while GEO climbed 1.2 percent to 33.80 pesos and Consorcio ARA was little changed at 7.97 pesos.

Alma Beltran, a spokeswoman for Urbi, Mexico’s largest homebuilder by market value, didn’t respond to requests for comment. Alejandro Haiducovich, a spokesman for GEO, the country’s third-biggest homebuilder, declined to comment.

Housing Demand

Ahumada of Consorcio ARA said overwhelming demand caused his company to lose sales in recent months when agents told customers there was a six-month wait for some new developments in the capital to be completed. Demand remains slow in some parts of the country, such as tourist destinations and areas where drug-related violence is high, he said. Total sales increased 2.2 percent in 2009, according to company reports.

Sales at Homex will increase as much as 14 percent this year, following a 3 percent gain in 2009, Chief Executive Officer Gerardo de Nicolas Gutierrez said in an e-mail. The company, Mexico’s second-biggest homebuilder by market value, added 2,000 jobs in the first quarter, he said.

“The improvement in job creation and recovery has a positive impact on domestic demand and consumer confidence,” Gutierrez said. “That has a positive impact on the consumption of goods and services such as housing.”

The jobs recovery is giving the government’s housing agency, known as Infonavit, more capital to provide mortgages, Homex Chief Financial Officer Carlos Moctezuma said on a conference call last month.

Regional Jobs Growth

Mexico’s job growth still trails that of Brazil, which forecasts 2.5 million jobs this year. Mexico has added 819,953 jobs since President Felipe Calderon, who campaigned as the “president of employment,” took office in 2006. Brazil, with double the population of Mexico, created 5 million jobs in that period.

There are signs that consumer demand still lags behind the broader economic rebound. Retail sales unexpectedly fell 0.1 percent in April from a year earlier.

Mexico’s economic growth probably will be less than in Brazil, where the central bank expects a 7.3 percent expansion this year. Peru’s central bank expects growth of 6.6 percent, while Colombia’s government forecasts 3 percent.

Mexico had a housing crisis after the peso devaluation in 1994 sent interest rates surging, causing widespread defaults. There’s little risk of a bubble similar to the ones in the U.S. and U.K. in 2006 and 2007 occurring now because homebuilders and banks learned their lesson in the 1990s, said Carlos Hermosillo, an analyst at Mexico City-based brokerage Vector Casa de Bolsa SA who covers 12 homebuilders and infrastructure companies.

Housing Shortage

At the end of 2009, Mexico had a housing shortage of 8.9 million units, according to the latest report from the agency in charge of developing Mexico’s mortgage market, Sociedad Hipotecaria Federal. The figure is the broadest measure of housing needs and includes families without a residence as well as those living in homes that are overcrowded or in ill-repair.

In the U.S., the number of contracts to buy previously owned homes plunged 30 percent in May from the prior month, the biggest decline in records dating to 2001, the National Association of Realtors said July 1. A collapse in the subprime mortgage industry, as well as reduced consumer confidence, has weakened demand for real estate.

Jorge Alberto Moreno, a Mexico City resident who was hired last year by Samsung Electronics Co., said the economic rebound is providing him with security. He plans to purchase a new home with his wife and son in the next year.

“We’re leaving the crisis behind and the situation is a bit more stable,” said Moreno, 32, who works in Samsung’s marketing department. “This gives us more confidence to make these kinds of decisions that you wouldn’t make otherwise.”

Mexico economy June 2010

Situation Unchanged: Growth still driven by exports
The Mexican economy has remained unchanged in terms of its main drivers. Growth relies essentially on exports, fueled mostly by a warming US economy, its main importer, but also likely to be helped by a weaker Peso after the strong devaluation in May. Local demand continues to show signs of recovery, but is currently insufficient to support economic growth by itself. This scenario is a continuation of the few past months and we believe it is likely to remain in June.
For the above reasons, we made only minor changes to our suggested portfolio for June. The only modifications were including Cemex, increasing the weight of Geo (from 5 to 10%) and withdrawing Ica and Mexchem.

Exports to the US account for roughly 80% of Mexico’s total exports. This engine, which is driving Mexico’s economic growth, is likely to continue speeding up, as the FED recently revised its estimate for GDP growth upwards. While this dependency on the North American economy might eventually pose a strategic weakness to the Mexican economy, it is a very positive feature for the moment. The eye of the world’s economic storm continues centered in Europe (more specifically in the euro zone), which accounts for only 5% of Mexican exports. Because of their minimal interaction in that region, Mexico’s economy and financial market have not suffered from the latest fears regarding the countries in the euro zone.

After an almost constant appreciation of the Mexican Peso against the USD in 2010 until April, in May the peso was very volatile, with losses of 5.7%. However, the trend toward appreciation will resume for the rest of the year, supported by inflows coming from the US, especially into the fixed income market. We expect the Peso to close at 12.00 versus the USD. This inflow from the US has played a positive role in the recovery of the Mexican economy, as local activity has already started to pick up although, so far, only in isolated segments. Transport, commerce and media are a few examples of segments that are either strong (in the case of the first two) or never suffered at all. The rest of the internal demand may recover by the second half of the year, as recent labor figures have been positive.

Because of the improved economic activity, the OECD (Organization for Economic Cooperation and Development) has recently increased its forecast for world GDP growth, including a revised 4.5% (from 2.7%) growth for Mexico. We have also revised our own estimate upward to 4.4%, from a previous 4.1%, the same as the median figure expected by market consensus. Inflation in June was down to 3.9%, temporarily helping the course of recovery, as full year inflation expectations remain at 4.9%

miércoles, 21 de julio de 2010


Middle-class Creoles were obsessed with the idea of independence. But even the rich Creole owners of haciendas and mines did not want to share the wealth of their country with the people of the Spanish nation.

They all had a common goal: to give the orders in their own house and to be master of all its furnishings. The opportunity to free themselves from the yoke came in 1808, which was the year that Napoleon, one of the greatest conquistadors of all time, occupied Spain. The Spaniards fought the invader; and the Mexicans, who no longer felt themselves to be Spanish, tried to take advantage of this crisis to become independent, as may be seen in the verses that one morning appeared on the walls of the capital: “Open your eyes, Mexican people, and use this opportunity. Beloved compatriots, fate has placed freedom in your hands; if you don not shake off the Spanish yoke, you will be wretched indeed.”

At about the same time, friar Melchor de Talamantes circulated subversive literature in which he declared that because Mexico had “all the resources and abilities needed to ensure the sustenance, preservation, and happiness of its inhabitants,” it could become independent. He went on to say that independence was not only possible but desirable because the Spanish government was not as concerned with the general welfare of New Spain as would be a free government set up by the Mexicans themselves. To deal with this situation, the viceroy called a series of juntas of representatives of the colony. The ayuntamiento (town council, generally called cabildo in the colonies) proposed in these juntas that a national congress be convened. Having accepted but not acted on the idea, the viceroy was deposed on the night of September 15, by a wealthy Spanish merchant and hacendado and his following of peons, office workers, and gachupines. The Spaniard imprisoned the patriots Francisco Azcárate, Primo de Verdad, and Melchor de Talamantes and he took the liberty of appointing as successors of the viceroy first a high-ranking army officer and then the top cleric of the country.

The coup d’état was counterproductive. While Spaniards denounced Creoles before the internal security committee that had been appointed to judge and punish those suspected of disloyalty, middle-class Creoles decided to resort to revolutionary solutions.

Plots were widespread, but it was the conspirators of Querétaro, San Miguel, and Dolores who, when they were discovered, first took up arms. The morning of Sunday, September 16, 1810, the cleric and teacher Miguel Hidalgo y Costilla, an old man who was well-to-do, influential, and brilliant, had studied with the Jesuits, and was priest of the village of Dolores, freed the prisoners and locked up the Spanish authorities. Calling his parishioners to mass, he urged them from the portal of his church to join a “cause” dedicated to the overthrow of bad government. This exhortation is officially known as the “Grito de Dolores” and is considered the high point in Mexican history.

Hidalgo left his parish with 600 followers but within a few days they had swelled to about 100,000 men—both Creole and darker skinned—from mines, haciendas, and obrajes. Although this multitude seemed to be more a mass demonstration armed with shovels and slings than an army, it encountered no resistance in San Miguel, Celaya, and Salamanca. The important mining city, Guanajuato, fell after a bloody battle and was pillaged.

The Bishop of Michoacán excommunicated Hidalgo, but the latter led his “army” against the Michoacán capital and forced the cathedral council to lift his excommunication. After Valladolid, he set out for Mexico City, which was relatively unprotected. He won the battle of Monte de las Cruces, requested a parley with the viceroy and then, without waiting for a reply, ordered a retreat during which he was defeated in San Jerónimo Aculco by the Spanish General Félix María Calleja.

Meanwhile, there had been uprisings in many parts of the country. Rafael Iriarte led insurgents in León and Zacatecas, and the friars Herrera and Villerías took possession of San Luis Potosí. In the northwest Juan B. Casas arrested the governor of Texas, in Nuevo León the governor declared its independence, ad viceregal troops defected in Coahuila and Tamaulipas. In central Mexico were the troops of Tomás Ortiz, Benedicto López, Julián and Chito Villagrán, Miguel Sánchez, and others. In the south José María Morelos, parish priest of Carácuaro and Nocupétaro, began his campaign. In the west there were three important movements. One was headed by José María Mercado, parish priest of Ahualulco, who captured Tepic and the port of San Blas. Another, under José María González Hermosillo, won almost all of Sinaloa, including the port of Mazatlán. The third was led by José Antonio Torres, born in the Bajío of Guanajuato, who entered Zamora with his army of insurgents. “The flower of Guadalajara youth” tried to stop them just outside of Zacualco. With their slings the Torres troops hurled such a shower of stones on the young men of Guadalajara that they killed many and put the rest to flight. Torres and his men entered Guadalajara on November 11, 1810.

After his defeat at Aculco, Hidalgo retired to Guadalajara where he issued decrees to give exclusive use of communal lands to their owners, to emancipate 6,000 Negro slaves, to eliminate state monopolies of tobacco, gunpowder, and playing cards, and to abolish the tributes paid by Indians. He also tried to organize a government, an army, and a newspaper. The army, composed of more than 30,000 men, was routed by Calleja’s forces at Puente de Calderón. The remnants of the insurgent troops then set off for Zacatecas in search of support from Iriarte but, pursued by Calleja, they continued north where they fell into a trap that had been laid for them by the former chief of the independence movement of Coahuila. The captives were taken before a council of war and Hidalgo was condemned to death and executed on July 30, 1811.

Nevertheless, the fight for independence was carried on by Ignacio López Rayón, who tried to unite the insurgents in the Junta of Zitácuaro, and by a group who went to represent Mexico at a convention in Spain. While part of the Mexican population fought against the viceregal government with sticks and stones and whatever else they could lay their hands on, another part accepted the invitation of the new Spanish government that had emerged from the struggle against Napoleon to send delegates to a convention that was to meet in Cádiz in 1811. The sixteen representatives were all Creoles except one and they were mainly clerics and young men of the middle class. In Cádiz they demanded equality before the law for Spaniards and Spanish-Americans, the elimination of caste distinctions, equal justice for all, the construction of roads, industrialization, government of Mexico for the Mexicans, schools, the return of the Jesuits, a free press, and the declaration that “sovereignty resides in the people.” Some of the Creole demands were accepted and incorporated into the constitution drafted by this convention in March 1812.

The Political Constitution of the Spanish Monarchy produced in Cádiz made Spain a constitutional monarchy. It gave real power to the executive branch and it took away the other two powers from the king. It was a liberal constitution guaranteeing individual rights, freedom of speech, and equal treatment for Spaniards and Spanish-Americans. Viceroy Venegas promulgated it in Mexico in September 1813 and immediately proceeded to hold elections for the ayuntamientos, the deputies to the Cortes, and the deputies to the five provincial districts that operated in Mexico. However, the Cádiz Constitution was too little and too late; and it remained in force for only about a year. Opposed by the Spanish group and by the wealthy Creoles, it was finally abolished in August 1814 by Viceroy Calleja, who succeeded Venegas. The reaction to this measure was to swell the ranks of the insurgents. On reestablishment of the authoritarian regime, several Creole intellectuals decided to join the army of the village priest Morelos. An intelligent but unlettered man who had been initially ignored and scorned, Morelos had been growing “in power and importance and, like those storm clouds born in the south, he soon covered a vast stretch of land.” With the passionate support of his devoted followers, he waged brilliant campaigns in 1812 and 1813. In a lightning maneuver, he captured Oaxaca and seized General González Saravia, supreme commander of the viceregal armies.

On april 12, 1813, Acapulco fell to Morelos, who confirmed his victory with these words: “The nation wants to be governed by the Creoles and since it has not been heeded, it has taken arms to make itself understood and obeyed.”

Everything seemed to indicate that the end of Spanish domination was imminent. Therefore, Morelos decided to convene a national assembly to give a political constitution to the nascent country. The Anáhuac Congress met for four months in Chilpancingo and it included such distinguished Creoles—both scholars and clerics—as Carlos María de Bustamante, former editor of the Diario de México; Ignacio López Rayón, former president of the Junta of Zitácuaro and author of Elementos constitucionales (Constitutional Elements); Father José María Cos, “a man of great talent and inventive genius,” former editor of two insurgent newspapers; Andrés Quintana Roo, famous poet, journalist, and jurist; Sixto Verduzco, physician; José María Liceaga, army officer; and Father Manuel Herrera. At the opening of the convention, Morelos asked the delegates to declare that Mexico was free and independent of Spain, that Catholicism was the only true religion, that sovereignty was vested in the people, and that laws “should moderate opulence and poverty” and banish “ignorance, plunder, and theft.” On November 6, the convention approved the Act of Independence and proclaimed that “there is not nor can there be peace with the tyrants.”


Although Morelos left Chilpancingo the following day in search of new triumphs, his political activities had permitted Calleja to regroup and mobilize the troops of the viceroyalty. Morelos was defeated in Valladolid and the royalists advanced on the south. After wandering from place to place, the Congress reached Apatzingán in October, 1814, and announced the constitution, which had been inspired in the French constitution of 1793 and the Spanish constitution of 1812. In its first forty-one articles it declared Catholicism to be the state religion, the sovereignty of the people to be exercised through Congress, law to be the expression of general will, and the happiness of citizens to consist in enjoying equality, security, property, and liberty. Almost two hundred articles referred to the form of government, which was to be centralist republican and divided into three branches of power. The legislative, composed of seventeen deputies, was above the executive with three sharing the title of president, and the judicial commanded by a supreme court of five people.

The Apatzingán Constitution was never put into practice because by the time it was promulgated, the insurgents had been dislodged from the southern provinces and Morelos had only 1,000 men left to face Calleja’s troops of 80,000. After a last desperate stand he was taken prisoner and executed on December 22, 1815, in San Cristóbal Ecatepec, near Mexico City.

With the death of the “Southern Thunderbolt,” the struggle for independence lost the last of its famous leaders but not its fighting spirit. Groups continued the battle from fortified points and redoubts; others waged guerrilla warfare; and others made sudden and brilliant raids on the enemy. Father Marcos Castellanos reinforced his position on an island in Lake Chapala; Ramón Rayón dug in at Cóporo, where he fought off several attacks; Ignacio López Rayón was entrenched at Zacatlán; Manuel Mier y Terán retreated to Cerro Colorado, Pedro Moreno to Sombrerete, and Pedro Ascensio to Barrabás.

Outside the fortified strongholds, bands of Indians, mestizos and mulattoes roamed the countryside. Driven by poverty and a desire for vengeance, they took over properties and murdered property owners. The troops of Villagrán and Osorno overran the outskirts of Pachuca and the plains of Apan. The followers of Gómez de Lara (“The Crate”), Gómez (“The Castrator”), Bocardo (“Colonel of the Colonels”), Arroyo, the Ortiz brothers, Olarte, Pedro el Negro, and others became notorious for their crimes. Detested by the rich Creoles, they nonetheless enjoyed the sympathy of most of the population. Francisco Xavier Mina, who came to New Spain in 1817 to fight “for liberty and for the interests of the Spanish Empire,” went over to the insurgent side, taking with him the men, arms, and money he had brought from England and the United States. After winning battles as far as Guanajuato, he was taken prisoner and executed at Fuerte de los Remedios. Most of the leaders entrenched on islands, hilltops, and bluffs, were quickly disposed of. Castellanos surrendered at the end of 1816, and Rayón and Mier y Terán at the beginning of 1817. The forts at Los Remedios and Jaujilla fell in 1818. Furthermore, Viceroy Apodaca, who succeeded Calleja, offered amnesty to resistance fighters, many of whom gave up their arms. Others, like Guadalupe Victoria, went into hiding and several were routed. By 1819 only a few minor guerrilleros like Pedro Ascencio and Vicente Guerrero continued to fight in the wilderness of the south.

Most of the Creoles had accepted defeat, when a new series of events put them on the road to independence, if not to liberty and social reform. In 1820, a liberal revolution forced Fernando VII to reestablish the Constitution of Cádiz. The Cortes, which was made up of fervent liberals, insisted on measures against the wealth and immunities enjoyed by the Church. News of these reforms caused consternation among the Spanish group and the Creole aristocracy of Mexico. Viceroy Apodaca refused to apply the Constitution of Cádiz and instead approved the Plan de La Profesa which declared that as long as the king was under pressure from revolutionaries, his viceroy in Mexico would govern with the Laws of the Indies and with complete independence from Spain. However, when Governor Dávila was forced to proclaim constitutional order in Veracruz, the viceroy declared the constitution to be en effect throughout the viceregal domain. He immediately proceeded to hold municipal elections and institute freedom of the press; and he thereby unwittingly set into motion the activity of organized groups. Spaniards who had supported the Plan de La Profesa tried to have it implemented, while rich Creoles saw the opportunity to achieve independence without the need to introduce social reforms. Both groups agreed that the leader to carry out their objectives was the Creole Colonel Agustín de Iturbide, a courageous, cruel, dissolute, and charming man who was never happier than when waging war.

Supported by the high clergy, the Spaniards, and the Creole owners of mines and haciendas, Iturbide, who had been commissioned to crush Guerrero, made a deal with the latter to join forces and together they announced the Plan of Iguala or the Three Guarantees: Roman Catholicism as the only recognized religion; equality of all Mexican citizens; and an independent Mexico with a constitutional monarch who would be a prefabricated king from one of the ruling houses of Europe. Then he launched a campaign on two fronts—diplomatic and military—which in five months had solved everything. The diplomatic consisted in gaining the friendship of the insurgent leaders against whom he had fought years earlier. The military campaign was brief and almost bloodless; many garrisons joined him willingly. Blaming Apodaca for the successes of Iturbide, the Spaniards in the capital again removed their viceroy, as in 1808, and they named Marshall Novella to replace him. A few days later, Juan O’Donojú arrived from Spain to take over the post of viceroy and he speedily came to terms with Iturbide. On August 24, 1821, he signed the Treaty of Córdoba, which ratified the substance of the Plan of Iguala. Iturbide led his victorious trigarante army into Mexico City on September 27, and the following day he was appointed head of the first independent government.

The consummation of independence produced great enthusiasm. In all the villages, towns, and cities there were parades with allegorical floats, triumphal arches, firework displays, and general rejoicing. Poets composed odes, sonnets, songs, marches, and verses in honor of the liberated nation. Several newspapers appeared and pamphlets were published; leaflets and letters obsessed with the subject of independence were circulated; there was talk of the wealth and economic resources of Mexico; it was said that the “location, fortune, and fertility of the new nation indicated that it had been created to give law to the whole world”; and it was announced that “the richest empire in the world was reestablished.”

Iturbide was acclaimed as a “man of God,” a “saintly man,” and “father of the nation.” Middle-class intellectuals wrote drafts of a political constitution and good laws; they drew up plans to promote agriculture, livestock raising, fishing, mining, trade, and public revenues; schemes to improve working conditions, to increase the population, and to extend education and health. Most of the projects took their inspiration from the experience of other nations. Some wanted to return to forms of Greek and Roman life, others believed that the model to follow was the young republic of the United States, several proposed that the Aztec Empire be emulated. Almost no one based his project on current Mexican realities. Perhaps none of the planners was aware at that time of the scarcity of natural resources, the lack of population, and above all the economic decline, social disruption, and political dislocation generated in the long struggle for independence. With very few exceptions, all closed their eyes to the obstacles and opened them only to see the advantages of independent life.

By Luis González y González

Cossío Villegas, Daniel et al. A Compact History of Mexico. Foreword by Robert A. Potash; translated by Marjory Mattingly Urquidi. 3a. ed. México. El Colegio de México, 2006, 1995. (6th repr., 2008). 159 p.

jueves, 8 de julio de 2010





Preint001 In Unit 1, you will learn to:
Preint002 talk about extended family with present simple
Preint003 talk about people at work and friends with the present simple and continuous
Preint004 use go and play to talk about sports
Preint005 discuss free time activities with read, do, listen, go, play and watch
Preint006 order food and take orders
Preint007 talk about the past with past simple
Preint008 ask questions with the past simple
Preint009 use countable and uncountable nouns
Preint010 talk about food with some, any, much, many, a lot of, a little and a few
Preint011 talk about the past with used to
Preint012 describe past actions with past continuous
Preint013 use correct intonation with questions
Preint014 pronounce weak vowel sounds
Preint015 In Unit 2, you will learn to:
Preint016 talk about future intentions with will and going to
Preint017 speak on the telephone
Preint018 describe people with what's...like / what does...look like
Preint019 talk about body parts
Preint020 compare things with comparatives -er, more and much
Preint021 describe cities with superlatives -est and most
Preint022 describe likes and dislikes with can't stand, hate, adore…
Preint023 talk about sizes with too and not enough
Preint024 use present continuous to talk about future arrangements
Preint025 make suggestions with let's, shall, what about, and how about
Preint026 contract sounds to sound more natural
Preint027 improve intonation when complaining
Preint028 improve pronunciation of vowel sounds
Preint029 In Unit 3, you will learn to:
Preint030 talk about life experiences with present perfect and past simple
Preint031 use English at the airport
Preint032 discuss news with the present perfect
Preint033 start a conversation with a new person
Preint034 use new words to talk about business around the world
Preint035 describe some things different countries sell with passives
Preint036 talk about your education with -ing and to
Preint037 ask for and give advice with should and shouldn't
Preint038 learn exercise vocabulary
Preint039 use modals of obligation and permission in the present have to, don't have to, must, mustn't, can and can't
Preint040 use modals of obligation and permission in the past had to, didn't have to, could and couldn't
Preint041 improve intonation to show interest
Preint042 improve sounds and stress patterns with 'tion' word
Preint043 In Unit 4, you will learn to:
Preint044 talk about future predictions with will and going to
Preint045 learn about extreme adjectives
Preint046 use a, an, the and zero article
Preint047 talk about relationships with present perfect, since and for
Preint048 talk about actions with present perfect simple and continuous
Preint049 interview for a job
Preint050 talk about future possibilities with first conditional, if and when
Preint051 ask for things politely
Preint052 talk about unreal or impossible situations with the second conditional
Preint053 use narrative tenses past simple and past perfect to tell stories in the past talk about past events
Preint054 report things people say
Preint055 improve intonation in conditional sentences
Preint056 improve pronunciation of sounds
Sylint0061 Intermediate 1
Sylint0062 In Unit 1, you will:
Sylint0063 talk about permanent and temporary situations using present simple and continuous
Sylint0064 use present continuous
Sylint0065 talk about future arrangements
Sylint0066 use new vocabulary to talk about government policies
Sylint0067 review past simple and continuous
Sylint0068 learn to describe people and things using ing/ed adjectives
Sylint0069 learn to use articles a, an, and the
Sylint0070 review this, that, these, those
Sylint0071 learn about negative comparatives using isn't as...as
Sylint0072 talk about big and small differences using just a bit, slightly, much, and a lot
Sylint0073 ask for, give, and receive directions politely
Sylint0074 talk about your life using used to, still and not anymore
Sylint0075 talk about quantity using a few, a lot of, much, many, a little, a bit of
Sylint0076 pronounce difficult vowel and consonant sounds
Sylint0077 stress words correctly
Sylint0078 use intonation to sound polite
Sylint0079 In Unit 2, you will:
Sylint0080 talk about your experiences using past simple and present perfect
Sylint0081 use some new education vocabulary
Sylint0082 talk about work using the present perfect continuous
Sylint0083 talk about education and work using for, since and ago
Sylint0084 describe experiences using when, as soon as, while, just as and until
Sylint0085 describe the background to a scene or story using past continuous
Sylint0086 talk about sequential events using past simple
Sylint0087 use was / were going to to talk about something you intended to do, but didn't
Sylint0088 talk about instant decisions using will
Sylint0089 talk about future plans using going to
Sylint0090 learn about negative prefixes
Sylint0091 describe people and places using some new adjectives
Sylint0092 learn about word families
Sylint0093 pronounce difficult consonant and vowel sounds
Sylint0094 Intermediate 2
Sylint0095 In Unit 3, you will:
Sylint0096 use passives in questions, positive and negative statements
Sylint0097 talk about winter sports and competitions
Sylint0098 make predictions using will, going to and might
Sylint0099 talk about certainty how sure you are using will and the adverbs definitely, probably and almost certainly
Sylint0100 talk about customs and culture using must, have to, mustn't and don't have to
Sylint0101 use didn't have to and had to to talk about obligation in the past
Sylint0102 speak about your obligations in the present and past
Sylint0103 learn water vocabulary about bodies of water and kinds of water
Sylint0104 give your teacher advice with should, shouldn't, ought to, I think, I don't think
Sylint0105 learn TV and film vocabulary
Sylint0106 review question form
Sylint0107 learn about subject questions
Sylint0108 pronounce common vowel sounds and 'ed' endings
Sylint0109 stress words correctly
Sylint0110 use correct intonation for questions
Sylint0111 In Unit 4, you will:
Sylint0112 use the prefix -im
Sylint0113 use public transport vocabulary
Sylint0114 learn to be polite when using public transport
Sylint0115 learn to speak with a bus driver
Sylint0116 use banking and money vocabulary
Sylint0117 use 1st and 2nd conditionals
Sylint0118 ask questions using 1st and 2nd conditionals
Sylint0119 report what people say using reported speech
Sylint0120 use say and tell
Sylint0121 make and ask reported questions
Sylint0122 talk about types of movies and describe them
Sylint0123 use the past perfect to describe movies and tell stories
Sylint0124 use narrative tenses with the past simple, past continuous and past perfect
Sylint0125 tell stories using when, while and during
Sylint0126 ask your teacher questions using verbs with to and -ing
Sylint0127 use verbs that take both to and -ing with a change in meaning
Sylint0128 use new phrases with the word drive
Sylint0129 pronounce difficult consonant sounds
Sylint0130 Intermediate 3
Sylint0131 In Unit 5, you will:
Sylint0132 use new adjectives to describe food
Sylint0133 give formal and informal opinions
Sylint0134 express agreement and disagreement
Sylint0135 practice agreeing or disagreeing
Sylint0136 use new vocabulary to describe stages of life
Sylint0137 use the future continuous
Sylint0138 use future perfect to describe actions that will already be completed by a specific time in the future
Sylint0139 describe people with the suffixes -er, -or and -ist
Sylint0140 use question tags to confirm information or ask questions
Sylint0141 recognize verbs and nouns that go together
Sylint0142 use words for music
Sylint0143 make suggestions
Sylint0144 use new vocabulary to rent a house or apartment
Sylint0145 use verb patterns with the prepositions for and about
Sylint0146 learn new words to talk about services and tradespeople
Sylint0147 use have something done to arrange for someone else to do something for us
Sylint0148 talk about customer service
Sylint0149 make polite requests
Sylint0150 stress words correctly
Sylint0151 use intonation to correctly
Sylint0152 pronounce difficult sounds
Sylint0153 In Unit 6, you will:
Sylint0154 use new vocabulary to talk about crime and criminals
Sylint0155 use modals of speculation - may, might, could, must - to make guesses about present and past situations
Sylint0156 express regret with should have
Sylint0157 talk about childhood with common phrasal verbs
Sylint0158 use the suffixes -hood, -ish, and -less to make nouns and adjectives
Sylint0159 describe mishaps using common verbs and nouns that go together
Sylint0160 use the 3rd conditional to talk about imaginary past situations
Sylint0161 describe people's personalities using some new adjectives
Sylint0162 talk about past wishes using I wish + past perfect
Sylint0163 review relative pronouns - that, which, who, when, where, those
Sylint0164 make sentences with defining relative clauses using that, which, who, when, where, whose
Sylint0165 talk about inventions
Sylint0166 add extra information to sentences
Sylint0167 use non-defining relative clauses
Sylint0168 use cleft sentences to make what you say stronger to emphasize what you say
Sylint0169 describe geographical features
Sylint0170 contract speech to sound natural
Sylint0171 stress words in sentences
Sylint0172 use intonation correctly