`Aztec tiger` Mexico

Chris Anderson, former editor of the U.S. magazine Wired, founded 3D Robotics in San Diego three years ago to develop drones, or unmanned civilian reconnaissance planes. A drone is not a weapon, but a do-it-yourself product that looks more genuine than a toy. The problem was the competition from China that featured cheap labor and relatively competitive technology. Anderson`s company could not be competitive through outsourcing from a plant in China. So he turned to Mexico. The company established a plant in Tijuana, which is about a 20-minute drive from San Diego, and started quick sourcing. The process of order, production and distribution used to take many months but was cut by an amazing degree. Anderson recently told The New York Times, “Mexico is the new China!”

Due to American entrepreneurs including Anderson, Mexico has emerged as a darling of foreign investors in recent months. From January to September last year, the Latin American country attracted foreign direct investment more than five times that of Brazil, as well as economic growth of 4 percent last year. Larry Pink, CEO of the world`s largest asset management company Black Rock, lauded Mexico as "an incredible growth story.” Standard & Poor’s is considering raising the nation’s sovereign rating to "BBB." What a sea change for Mexico, which almost became a failed state due to narcotics and violence, while Brazil emerged as “the big brother" of Latin America by achieving annual growth of more than 5 percent under the leadership of former President Luiz Inácio Lula da Silva. So what engineered Mexico`s turnaround?

The Financial Times of London said the answer is Mexican President Enrique Peña Nieto, who was inaugurated in December last year. Since winning the election in July last year, he took the lead in changes as president-elect. After saying politics and economy "can move to a productive direction through reforms” on inauguration day, he opened up to foreign investors the telecom sector, which had been monopolized by conglomerates, and the state-run oil company Pemex. He also announced 95 projects to transform his country, including education and tax reform. Less than 24 hours after his speech, he assembled leaders of major political parties and cleverly prompted them to sign a “Treaty for Mexico.” Nieto boldly appointed the finance minister from the previous right-wing government as his foreign minister and the head of the left-leaning opposition party as social development minister. He also pledged to eradicate deep-rooted corruption and cronyism between politicians and businessmen. Mexico has thus been reborn as an “Aztec tiger” and is taking a great leap forward.

Korea was once called an “Asian tiger.” Ireland was dubbed “Celtic tiger” in the 2000s, but is struggling in the aftermath of the global financial crisis. Mexico`s newfound economic vitality might stem from its growing export and advancement of industrial structure that has continued for 20 years under the North American Free Trade Agreement. An explosion occurred at Mexican state oil giant Pemex headquarters Thursday soon after the country was called an Aztec tiger. Hopefully, Mexico revives itself like a real tiger by overcoming the flames

Editorial Writer Kim Sun-deok (yuri@donga.com)