“Do what thou wilt shall be the whole of the law”: Not a recipe for enticing investors to your free and open capital markets.
El Financiero, which I think you could rightly call Mexico’s premier financial daily, launches what I think is a quiet broadside againt Plan Calderón today in its “Intelligence Unit” column.
Crime, the analysis suggests, is less of a concern to foreign investors than the unpredictability of contract and other rights enforcement in the Mexican judicial system.
Just ask NBC and Telemundo.
The unspoken point here: No matter what Transparency International says, the corruption is jaw-dropping and the police, army, government and judiciary may well play a larger role than the cocaine and marijuana rackets do.
Their use of violence, after all, is legitimated.
Mexico ranks 70 out of 163 nations in this year’s TI survey, where No. 1 indicates the most corruption-free countries according to survey respondents.
I would call that a gentleman’s C+.
And an absurdity, given the structural incentives to impunity in all areas of legal rights — personal as well as corporate — that exist there.
Kenya, site of the economic miracle documented in Ensminger’s “Making a Market,” — as well as this year’s World Social Forum — came in at 142 in the last survey.
Investigadores de El Colegio de la Frontera Norte (Colef) sostienen que, en términos empíricos, la violencia delictiva puede frenar la llegada de capitales extranjeros, pero nada que quite el sueño.
Researchers from the College of the Northern Border (Colef) argue that, in empirical terms, criminal violence may negatively affect the flow of foreign investment capital into Mexico. But not to the extent that we should lose sleep over it.
Al interrogarles sobre ¿cómo influye la inseguridad pública en la decisión empresarial de invertir en México?, coinciden en que la inseguridad jurídica y la incapacidad para hacer respetar los derechos de propiedad y el cumplimiento de contratos son los verdaderos retos para las autoridades mexicanas para fomentar la llegada de más capitales extranjeros al país.
When asked how lack of public security weighed in business decisions about investing in Mexcio, [the researchers] agreed that uncertainties about the legal system and the lack of gurantees that property rights and contracts will be enforced are the true obstacles that Mexican authorities need to address in order to stimulate foreign investment.
It’s not the outlaws.
It’s the lawmen.
Welcome to Tijuana.
Tequila, sexo, marijuana.
Welcome to Tijuana.
Con coyote no hay aduana.
Manu Chao. “If you have a coyote you don’t have to go through customs. “
El doctor Eliseo Díaz González, investigador del Departamento de Estudios Económicos del Colef, sostiene que el tema de la violencia en la sociedad y la disputa entre narcotraficantes, “al menos en el caso de la frontera norte”, al parecer no repercute de manera importante sobre la inversión extranjera.
Dr. Eliseo Díaz Gonzáez, a researcher in the Economic Studies Dept. at Colf, argues that the problem of violence in society and the conflict in the narcotraffic, “at least along the northern border,” seems not to have a signficant impact on foreign investment.
Agrega que “casualmente, en los estados fronterizos, Nuevo León incluido, conviven altos niveles de violencia con elevados volúmenes de inversión extranjera directa, y lo han hecho, como en el caso de Baja California, durante muchas décadas. Coinciden los factores que hacen atractiva a la frontera norte de México para la inversión extranjera -la cercanía con el mercado de consumidores más importante del mundo- y para las actividades ilícitas”.
He adds that “frequently, in the border states, including Nuevo León, high levels of violence are found along high levels of foreign investment and have, as in the case of Baja California, for many decades. The factors that make the northern Mexican border attractive for foreign investment — the proximity to the most attractive consumer market in the world — are the same that make it attractive illegal enterprises.”
Análisis empíricos aportados por Alejandro Díaz-Bautista, doctor en economía por la Universidad de California e investigador del Colef, muestran que la inseguridad pública y la corrupción en general tienden a disuadir la inversión extranjera directa; se asocia perceptiblemente a niveles más bajos de inseguridad pública y de corrupción.
Empirical studies carried out by Alejandro Díaz-Bautista, a Ph.D. economist from the Univ. of California and a Colef researcher, show that public safety risks and corruption in general tend to dissuade foreign investors, which is significantly correlated to lower levels of public safety risk and corruption.
I wonder how they measure corruption? Let me download that from their site.
Se puede mencionar que una disminución de la inseguridad pública y la corrupción de 0.27 -en una escala de 1 a 10- provoca un aumento de la afluencia de capital foráneo directo, en razón del porcentaje del PIB.
It was observed that a decrease in public safety risk and corruption of 0.27 — on a scale of 1 to 10 — is enough to provoke a rise in direct foreign investment, as a percentage of GDP.
Sin embargo, “México sigue siendo muy atractivo como destino de inversión extranjera. En el corto plazo, se tienen importantes ventajas para atraer capitales sobre otros países de América Latina. Pero en el largo plazo hay incertidumbre, debido al inadecuado nivel de competitividad de México en el plano internacional y porque no se han realizado las reformas estructurales, al igual que no se impulsan las inversiones necesarias en infraestructura, educación e investigación, necesarias en el país para tener un crecimiento económico vigoroso”, sostiene Díaz Bautista.
Nevertheless, “Mexico continues to be very attractive to foreign investors. In the short term, it has very important advantages in attracting investment from other Latin American nations. But in the long term there is uncertainty, due to the Mexico’s inadequate level of global competitiveness and because it has not realized structural reforms, as well as the fact that it has not promoted the necessary investment in infrastruture, education and research, which are needed if a country is going to have strong economic growth,” Díaz says.
A decir de Eliseo Díaz, México dejó de ser una economía emergente importante, como en la década de los noventa, debido a la irrupción de China y la India en los mercados internacionales; sin embargo, el proceso de integración económica con América del Norte se mantiene como factor atractivo para abastecer ese mercado.
According to Díaz, Mexico lost its status as an important emerging economy in the 1990s, thanks to the explosion of China and India onto the international scene; however, the process of economic integration with North American continues to be a draw.
“También debemos tomar en cuenta que nuestro país tiene a cuestas un largo proceso de estancamiento y un desempeño por debajo del nivel potencial que ha caracterizado a su economía a lo largo de esta década. Potencialmente, el mercado de consumidores en México es importante, especialmente si la economía puede volver a recuperar los altos índices de crecimiento del pasado, y si el factor demográfico continúa jugando a favor del crecimiento económico”, detalla el investigador.
“We should also take into a account that our country is carrying a long period of stagnation on its back, and that it has underperformed the potential that has characterized its economy throughout this decade.
[Zap! Shocks Fox.]
The consumer market in Mexico could be an important one, especially if the economy were to recover the high growth rate of the past, and that demographic factors continue to favor growth,” the researcher says.
In other words, killing all your vigilante consumers of government services is not going to help matters any.
As alpha-beancounter Ronald Hilton noted back in 2000, about the TI survey for that year:
Mexicans are convinced that corruption is perhaps the main cause of the country’s woes, and Vicente Fox has vowed to eradicate it. Yesterday he met with the leaders of the Mexican branch (of TI), and the president of the international organization was interviewed on TV. He was asked where Mexico stood in the corruption list. The response was 58th, one being the least corrupt, indicating a pretty high degree of corruption. No comment was deemed necessary.
The New Market Machines 