Foreign Policy / Immigration / Latin America

Why Should the US Continue to Increase Investments in Mexico?

For one very simple reason- it’s the right thing to do. Now, in saying that, I really mean that it’s the right move to make.

While true altruism is something that exists only in the figments of the most optimistic imaginations, it’s important to note the benefits that the US’ continued investment in Mexico could derive.

Mexico is certainly not the country that it once was. It’s developing, its population is aging and its economic boundaries are expanding.  For this reason, the Mexicans of today are not driven by the same motivations that the Mexicans of the largest wave of migration during the 1990s were.

Today, unauthorized immigration from Mexico has reduced significantly. According to the research of Douglas S. Massey, the co-director of the Mexican Migration Project at Princeton University, interest in migrating to the US has reached its lowest levels since the 50s. In fact, according to Pew Hispanic Center, there is a net negative flow of migration from Mexico.

The reason for such a sharp decline is three-fold. First, economic conditions in Mexico have improved greatly, thus reducing the incentive for would-be immigrants to uproot themselves in search of opportunity elsewhere. Also, the US recession of 2008 has reduced the possibility of immigrants finding work. Lastly, crossing the US border illegally has become more hazardous, with crossing-related deaths becoming more common.

In present day, people in Mexico are weighing the benefits of immigrating versus the drawbacks and are finding that it is simply not worth it.

This is what is currently happening. But, what will happen when the US economy recovers fully and opportunity for employment once again rises? On top of this, while Mexico has come a long way, with current poverty levels falling to less than 20%, it is still a developing country.

If the US wishes to maintain these reduced immigration levels, then it is in the country’s best interest to increase investments within Mexico.

While overall US foreign investment has risen, 70% of this investment is conducted within high-income countries.

The benefits of US firms increasing investments made within Mexico would be two-fold. On one hand, it is cheaper and more convenient for US firms to produce in Mexico than in other locations, and on the other hand, it creates jobs for Mexicans in their own country.

Not only will the profits of US firms increase, with lower overhead costs, but the Mexican economy, which is greatly tied to that of the US, will grow and thus provide more employment opportunity for the people of the country.

We can complain about how unauthorized immigrants do not deserve the same rights that US citizens do, but the reality is that the majority of Mexican immigrants are hardworking people trying to improve their economic situation.

Unless we find a viable means for reducing immigration, the problem will not solve itself and people will continue to be drawn to where opportunity calls. If we don’t want illegal Mexican immigration to once again increase, then a practical solution would be to create a means – one that will benefit the US as well – for the economic situation of would-be Mexican immigrants to improve at home.

One thought on “Why Should the US Continue to Increase Investments in Mexico?

  1. How much of the drug problem and the immigration problem can we solve by more direct (business) investment in Mexico?

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