By MORTZ C. ORTIGOZA
Have you wondered why Mexico, a spit distance to the USA, is not as rich and powerful as Mainland China which is too far away to the No.1 economic power America?
The influx of U.S businesses from the U.S mainland became the linchpin of what is the Chinese economy today - No.2 economic juggernaut of the world.
Here’s my favourite book author and New York Times columnist Thomas Friedman who explained in a pedestrian manner why Mexico has been sluggish economically, and why the Chinese enjoyed its leapfrogging growth for several years.
“Mexico’s ranking in the Global Competitiveness Report actually fell while China’s rose. And this was not just about cheap wages, said (Neil) Rosen. It was about China’s advantages in education, privatization, infrastructure, quality control, mid level management, and the introduction of new technology.”
“So China is eating Mexico’s lunch,” concluded Rosen, “but more due to the Mexican inability to capitalize on success and induce broader reform than to China’s lower wage workers per se, ” stressed by Friedman.
According to the Doing Business Report, it takes, Filipinos listen, an average of fifty-eight days to start a business in Mexico, compared with eight in Singapore and nine in Turkey. It takes seventy four days to register a property in Mexico, but only twelve in the United States. Mexico’s corporate income tax rate of 34 percent is twice as high as China’s.
In terms of the length of starting a corporate business and the income tax rate, Mexico and the Philippines are almost the same.