OECD Economic Surveys: Mexico 2017 (eBook)

Oecd (Autor)

eBook Download: EPUB

2017 | 1. Auflage
128 Seiten
OECD Publishing (Verlag)
978-92-64-26870-8 (ISBN)

Infos

Ambitious structural reforms and sound macroeconomic policies have ensured the resilience of the highly-open Mexican economy in the face of challenging global conditions. Mexico’s productivity growth has recently picked up in sectors that benefitted from structural reforms – energy, financial, and telecoms. Trade openness, foreign direct investment, integration into global value chains and innovation incentives have boosted exports, notably of autos. Yet other sectors lag behind, suffering from overly stringent local regulations, weak legal institutions, rooted informality, corruption and insufficient financial development. Moreover, growth has not been inclusive enough to achieve better living conditions for all Mexican families, many of whom live in poverty, and whose children’s opportunities to do better than their parents could be improved. Past policies have already begun to correct these trends, but more needs to be done. The 2017 Survey makes key policy recommendations that could help to boost productivity and make growth more inclusive.

SPECIAL FEATURES: INCLUSIVE GROWTH; PRODUCTIVITY

Inhalt

Table of contents 5
Basic statistics of Mexico, 2015 10
Executive summary 11
Growth is strong, but disparities persist across Mexico 12
Growth disparities across Mexican states are increasing 12
Productivity is picking up thanks to ambitious structural reforms 12
Total factor productivity is recovering 12
Income inequality and gender gaps remain high 12
Income inequality is high and female labour force participation is lagging 12
Assessment and recommendations 15
Reforms are working, but disparities persist across Mexico 16
Table 1. The government’s package of structural reforms since 2012 16
Figure 1. Reforms are expected to yield large impacts 17
Despite external headwinds, growth is resilient 18
Figure 2. The economy is resilient 18
Table 2. Macroeconomic projections 19
Box 1. Recession risks are low 19
Figure 3. A recession is unlikely in the short term 20
Box 2. Mexico’s oil dependence has fallen, but remains elevated 20
Figure 4. Oil dependence in Mexico 21
Vulnerabilities persist 22
Box 3. Key vulnerabilities 22
Monetary policy has been successful at containing inflation 22
Figure 5. Monetary policy has successfully anchored inflation expectations 23
Table 3. Banking system financial indicators 23
Table 4. Past OECD recommendations on financial stability 24
Fiscal performance is improving but the credibility of the fiscal rule could be enhanced 24
Figure 6. The government expects to return to primary surplus and put the debt-to-GDP on a downward path 25
Table 5. Implementation of recommendations to mitigate commodity-related risks 26
Table 6. Past OECD recommendations on fiscal policy 26
Fiscal policy needs to be more supportive of inclusive growth 26
Figure 7. Some well-being indicators are low compared to OECD peers 27
Figure 8. With low social spending, poverty and income disparities remain high 29
Figure 9. Disparities across Mexico 30
Table 7. Past OECD social recommendations 30
Table 8. Past OECD recommendations on health policy 31
Figure 10. Mexico’s tax structure should be more diversified 32
Table 9. Tax expenditures have declined (% of GDP) 32
Figure 11. Mexico’s VAT, as a share of tax revenues, is in line with OECD but lags behind peer countries, 2014 33
Table 10. Tax evasion estimates have been declining but remain high 33
Figure 12. Increase spending while ensuring fiscal sustainability 34
Mexico still needs to deliver on skills and education gaps 34
Figure 13. Education quality remains lacking in Mexico and regional differences persist 35
Figure 14. Lack of skills is a major constraint on firms’ operations 36
Table 11. Past OECD recommendations on education and skills 37
Realising Mexican women’s aspirations 37
Table 12. Gender inequalities are large 38
Figure 15. Female labour force participation in Mexico has increased but leadership gaps remain 38
Table 13. Past OECD recommendations on gender and labour market dynamism 39
Figure 16. Gender gaps in financial inclusion are large 40
Table 14. Past OECD recommendations on financial inclusion 40
Reforms are boosting productivity in certain industries 40
Figure 17. Multi-factor productivity diverges across sectors 41
Figure 18. Employment and productivity changes in the agriculture sector during catching-up episodes among selected OECD countries 42
Box 4. Examples of policies to reduce informality 43
Openness to trade and investment is paying off in some sectors 44
Figure 19. Mexico’s import content of exports (ICE) in selected manufacturing sectors has declined 44
Figure 20. Ample scope to reduce foreign investment and trade barriers 45
Further reforms are needed to improve governance and legal institutions 46
Figure 21. Mexico is the poorest performer for safety and corruption across OECD countries 47
Table 15. Past OECD recommendations on legal issues 48
The carbon emissions tax rate remains insufficient 48
Box 5. Green growth developments and challenges 49
Figure 22. Green growth indicators in Mexico 50
References 51
Annex. Follow-up to previous OECD policy recommendations 55
Financial stability 56
Fiscal policy 56
Social policy 57
Health policy 57
Education and skills 58
Gender and labour market dynamism 58
Financial inclusion 58
Legal issues 59
Urban policy 59
Regulatory policy 59
Thematic chapters 61
Chapter 1. Towards a more inclusive society 63
Financial inclusion 64
Financial inclusion can spur economic growth and reduce poverty 64
Figure 1.1. Financial inclusion is a key enabler of economic growth and poverty reduction 65
Where does Mexico stand? 65
Table 1.1. Timeline of reforms and commitments on financial inclusion 66
Figure 1.2. Financial inclusion in Mexico remains the lowest amongst OECD countries 67
Figure 1.3. Financial access points are still low in many municipalities 67
Figure 1.4. The state of financial inclusion has improved from 2009 to 2015 68
Box 1.1. Financial Inclusion Index 69
Figure 1.5. Use of financial services and access points has slightly improved 70
Figure 1.6. Gender gaps in financial inclusion are large 71
Figure 1.7. The use of formal credit is low 71
Better access to financial services can boost entrepreneurship 72
Box 1.2. Entrepreneurship and SME policy in Mexico: The role of INADEM 73
Figure 1.8. Women entrepreneurs’ share in the informal sector is large while the share of women employers is significantly lower 75
Box 1.3. Financial inclusion and female entrepreneurship 76
Table 1.2. Econometric estimation results for different samples 76
Table 1.3. Econometric estimation results for formal and informal females in urban and rural areas 77
Table 1.4. Econometric estimation results for formal and informal females by economic sector 77
The role of firms in achieving sustainable and inclusive growth 77
Achieving green and inclusive growth 78
Enabling women’s equality and untapped potential 78
Figure 1.9. Paid leave entitlements should be more gender equitable 79
The business case for firms to be inclusive and sustainable 80
Box 1.4. Environmental, social and governance (ESG) scores 81
Are Mexican firms doing well by being good? 81
Figure 1.10. ESG scores of Mexican firms are lower than other Latin American countries 82
Figure 1.11. Differences between sectors are large 83
Box 1.5. Do ESG-friendly firms perform better? 84
Table 1.5. Estimated coefficients on the association between ESG scores and firms’ financial and productivity performance: Mexican firms 84
Table 1.6. Estimated coefficients on the association between ESG scores and firms’ financial and productivity performance: Mexican, Latin American and North American firms 85
Table 1.7. Testing for causality 86
Policy recommendations to improve inclusion 86
References 87
Chapter 2. Boosting productivity through integration into Global Value Chains 89
Figure 2.1. Productivity is picking up in some parts of the economy 90
Determinants of GVC integration 90
Where does Mexico stand? 92
Figure 2.2. Mexico’s backward and forward participation in GVCs, 2011 93
Figure 2.3. Backward GVC participation ratio: relative contribution of policy and non-policy factors 94
Figure 2.4. The impact on GVC integration of other policies 95
Figure 2.5. Mexico’s participation in GVCs, share of intermediates in total trade of manufactured goods and export penetration into the US economy 96
Figure 2.6. Mexico’s exports are evolving 97
Box 2.1. Mexico’s car industry: A success story 97
Box 2.1. Mexico’s car industry: A success story (cont.) 98
Figure 2.7. Light vehicles production and installed capacity 98
Box 2.1. Mexico’s car industry: A success story (cont.) 99
Figure 2.8. Auto sector performance 99
Figure 2.9. Mexico’s backward and forward participation to GVCs in selected sectors vs peer OECD countries (2011) 100
Box 2.2. Projecting Mexico’s backward integration to GVCs in 2014 100
Table 2.1. Estimation results of ICE model by industries 101
Figure 2.10. Projected 2014 backward GVC integration in manufacturing industries (ICE) 101
Where does Mexico have a comparative advantage? 102
Figure 2.11. Sectorial complexity measures vs backward participation in GVCs (ICE) 102
Figure 2.12. Backward GVC participation and labour productivity vs revealed comparative advantage (RCA) 103
How can Mexico further integrate and climb up GVCs? 103
Figure 2.13. Mexico’s Knowledge Economy Index (KEI) is the lowest among OECD countries 104
Foreign Direct Investment (FDI) 104
Figure 2.14. FDI flows and stocks 105
Figure 2.15. FDI, backward integration to GVCs and labour productivity 105
Figure 2.16. Foreign investment and service trade barriers remain high in some sectors 106
Research and Development (R& D) and innovation
Figure 2.17. Research and development (R& D) expenditure
Figure 2.18. Sectors spending more in R& D are more integrated in GVCs and enjoy higher labour productivity
Figure 2.19. Intellectual property activity 109
Figure 2.20. ISO certified industries are more backward integrated in GVCs 110
Skills 110
Figure 2.21. Sectors with higher educated workers are more productive and more integrated in GVCs 111
Figure 2.22. Mexico’s share of engineering graduates is high but lags behind in tertiary and vocational 111
Competition is essential to ensure access to GVCs 112
Figure 2.23. High sectoral concentration is an issue in the south 113
Figure 2.24. High sectoral concentration can be persistent 114
Figure 2.25. Entry barriers vary widely across localities 115
Are GVCs inclusive in Mexico? 115
Figure 2.26. Contribution of SMEs to GVCs in Mexico 116
Figure 2.27. Informality and productivity by firm size 117
Estimates of misallocation help to see the potential upside of reform 118
Box 2.3. How does Mexico’s productivity dispersion compare with China’s? 118
Figure 2.28. Aggregate TFP growth and firm-level dispersion 119
Box 2.4. Modelling misallocation 120
Box 2.4. Modelling misallocation (cont.) 121
Table 2.2. Gains from a more efficient allocation of production factors 122
Figure 2.29. More efficient factor allocation could shift out the productivity distribution 123
The dark side of GVCs 123
Figure 2.30. Vulnerability to demand shocks in GVCs, by economy 123
Policy recommendations to boost productivity 124
Notes 124
References 125

Textauszug

Annex Follow-up to previous OECD policy recommendations

This annex reviews action taken on recommendations from previous Surveys. They cover macroeconomic and structural policy priorities. Each recommendation is followed by a note of actions taken since the January 2015 Survey. Recommendations that are new in this Survey are listed in the relevant chapter.

Financial stability

Recommendations	Actions taken

Further strengthen competition in the banking sector to support healthy development of capital markets, but with special consideration of financial stability issues (2013).

Significant action taken through the approval and implementation of the 2014 financial reform. These include measures to strengthen creditors’ property rights, rules for the resolution of banks, and requirements that promote competition for bank accounts and financial services.

Strengthen autonomy on budget and staffing matters of the key financial sector agencies, give legal status to the Financial Stability Council and widen the toolkit for macroprudential intervention to ensure effective and efficient achievement of macroprudential objectives (2013).

Action taken, by giving the Banking and Securities Commission new supervisory powers and the Financial Stability Council legal status. Basel III capital requirements were made mandatory by law but work on widening the macroprudential toolkit is still on-going.

Focus on fully implementing the reform package with close monitoring at a high political level, and strengthen administrative capacity and governance quality at all levels of government (2015).

Still on-going. The President’s office follows reforms closely, and has addressed bottlenecks in implementation of the education reform and promoted faster implementation of the legal, energy, competition, financial, fiscal, labour and electoral reforms. An anti-corruption and transparency reform has been passed and its implementation has begun.

Fiscal policy

Recommendations	Actions taken

Move towards a structural fiscal rule to reduce the partial pro-cyclicality of the current framework (2013).

The 2014 reform added a current expenditure cap to the previous rules. However, the new framework only approximates a structural rule.

National accounts standards should be fully implemented in the budget (2013).

Still on-going.

The fiscal stability law should be reformed to increase the build-up of financial buffers in liquid assets available in case of contingency or adverse market sentiment (2013).

Actions taken with the Fiscal Responsibility Law in 2015 which established the Mexican Oil Fund for Stabilization and Development in 2015.

Establish a harder budget constraint on sub-national governments to improve their tax collection by limiting further increases in transfers, avoiding extraordinary transfers and promoting the implementation of limits on deficits and debt ceilings (2013).

Action taken with several modifications through the Constitutional reform on fiscal discipline for sub-national governments and the Fiscal Discipline Law for subnational governments, to address sub-national deficits, debt limits and expenditure control. The Federation grants a guarantee over the sub-national debt to those States willing to sign an agreement in which they commit to specific balance and debt limits, as well as other key financial ratios.

Improve subnational governments’ spending efficiency and effectiveness by clarifying spending responsibilities for lower levels of government in health and education (2013).

Starting in 2015, a new fund for expenditure on basic education (FONE) substituted the fund that covered the wages of the basic education payroll in Mexico. A new Health General Law was published in 2014 establishing mechanisms that ensure a more efficient and transparent health sector spending for the Seguro Popular.

Grant more tax powers to states. Strengthen property tax revenues by updating property registries, increasing rates, removing exemptions and improving collection, by allowing the federal or state tax administrations to collect the tax (2013).

Actions taken by allowing States to charge income tax on payrolls, and since 2015 States and municipalities can fully participate in the income tax of their administrative staff. In the case of consumption taxes, the fiscal reform unified consumption (VAT) rates across States. An incentive for municipalities that transfer the administration of the property tax to the state government was established in the Fiscal Federalism law in 2014, in the form of access to special transfer funds (for municipalities and for states).

Social policy

Recommendation	Actions taken

Increase the coverage and size of Oportunidades cash transfers to the poor, complete the implementation of Seguro Popular, and broaden the coverage of 65 y más old-age pensions (2013). Fully roll-out the new Prospera cash transfer programme to help beneficiaries expand their capabilities, complete their education, join the formal sector and obtain well-paid jobs (2015).

Actions taken with a new programme, Prospera, replacing the old Oportunidades. The new programme connects social policy with economic dynamism by adding new dimensions, such as benefits in health, education, nutrition, financial inclusion, job placement and priority access to production programmes. Through training and job programmes, beneficiary families will be able to generate their own income and depend less on cash transfers from the Government. The Senior Pension Programme (65 y más) has achieved national coverage.

Take steps to delink the minimum wage from other prices in the broader economy; and investigate the effects on jobs and informality of raising the minimum wage in real terms (2015).

Significant action taken in November 2015 when the Chamber of Deputies approved new legislation to delink the minimum wage from any legal binding to set fees, payment of loans, services and sanctions among others.

Evaluate and streamline social benefit programmes (2013).

Ongoing as social benefit programmes are continuously evaluated and are obliged to have a matrix of indicators for results, which links such indicators with sectorial objectives.

Approve draft legislation for unemployment insurance and universal pensions to protect job seekers and old-age people against the risk of income losses, and reduce inequality (2015, 2013).

Still pending. The government proposed the introduction of unemployment insurance for formal workers and universal pensions for all retirees. The Lower Chamber has already approved the reform proposal (April 2014). However, these measures have yet to be approved by the Senate, due to fiscal pressures from the fall in oil prices and raising concerns about costs.

Health policy

Recommendations	Actions taken

Promote access to quality health care through improved co-ordination across health institutions to reduce redundancies; in particular, promote exchange of services between health care networks (2015).

In 2016, the National Agreement Towards Health Service Universalization was signed, with the goal to gradually ensure portability across providers. It was signed by the Ministry of Health, ISSSTE, IMSS, and three states. More states are expected to join in the near future. Also, the number of agreements to exchange health services between institutions had been increasing in the last years, from seven in 2014, to 11 in 2015.

To improve quality and reduce costs of services across all health care providers, standardise procedures and make health insurance mandatory (2015).

Efforts have been made to improve the efficiency and productivity across providers. IMSS has achieved important gains in efficiency by implementing consolidated drug procurement. The success of this scheme has prompted its expansion to include more states, pharmaceutical companies and drugs.

Allow free choice of health networks for new employees, and encourage competition between health care providers (2015).

IMSS has implemented a consolidated drug procurement procedure, making use of reverse auctions among potential participants and encouraging competition among providers. IMSS also has continuous collaboration with entities such as the COFECE (Federal Economic Competition Commission) to ensure transparency in all procurement procedures.

To reduce underreporting of wages...

Produkt-Details

• Erscheint lt. Verlag: 10.1.2017
• Sprache: englisch
• Themenwelt: Sozialwissenschaften ► Politik / Verwaltung ► Staat / Verwaltung
• Themenwelt: Wirtschaft ► Volkswirtschaftslehre ► Wirtschaftspolitik
• ISBN-10: 92-64-26870-7 / 9264268707
• ISBN-13: 978-92-64-26870-8 / 9789264268708