Mexico blighted by poverty reduction challenges

MEXICO CITY, March 18 (UPI) -- Mexico faces major challenges in its poverty reduction programs despite government optimism that new investment will create the desired numbers of jobs.

Rampant crime, neglect of the middle classes and endemic security issues are unresolved issues that threaten to derail the government's ambitious program.

This week President Felipe Calderon inaugurated two new Safran group factories in Queretaro, central Mexico. Officials said the factories represent an investment of $160 million and would create about 500 jobs.

Calderon said the new plants were part of the government aim to ensure a more equitable income distribution.

"We are working hard to achieve economic recovery because our priority is to restore Mexican families' employment and income levels," he said.

"We not only want this economic recovery to occur but we also want it to be felt in families' pockets, which is why we will continue promoting actions such as this that translate into new investments, new jobs and greater economic growth."

He said that government will continue to work with businesses to turn Mexico into one of the world's best investment sites.

Grupo Safran's industrial plants belong to Messier-Dowty, a firm specializing in the manufacture of landing undercarriage systems and Snecma Propulsion Systems, which produces airplane engines.



Calderon said he hoped to mark 2010, the year of Mexico's independence bicentennial, as the year of economic recovery.

Charles Rault, director of ISRIA.com information consultancy, said the government needs to do more to remove the challenges of crime and class inequalities that produced serious security issues for Mexican society.

"Mexico's anti-poverty program (Oportunidades) seems so successful that several cities or countries around the world have been inspired by this program," Rault told United Press International, citing copycat programs in New York City and a number of African countries.

The Oportunidades program pioneered an innovation by making "human capital" a priority, Rault said.

But, while 20 years ago, Mexico was widely predicted to take the economic lead in Latin America, it now trailed Argentina, Brazil and Chile, Rault said.

The government was right to pursue the Oportunidades program and its comprehensive emphasis on education, health and nutrition was on the mark, as "a healthy population means more workers able to work more efficiently" and be more competitive in the international marketplace.

However, if poverty was significantly reduced in the poorest portions of the Mexican population, it was still necessary to stabilize the middle class, which was suffering from the effects of the economic and financial crisis, Rault said.

"The disparities between the average population and the richest people have steadily widened over the past decade," Rault said.

"The other issue that is crucial for the future of Mexico is security," he said. "Today, Mexico is better known for its crime rate than for its tourism program or its fight against poverty. Growing insecurity seriously affects the civilian population and could delay or prevent economic development in the long term due to an environment that creates some concern among investors, particularly foreigners."

That also means creating a climate that would reduce the growing migration of Mexicans into the United States, or elsewhere, Rault said.

"The challenge ahead now is more the fight against insecurity rather than the one against poverty even though the two often go hand in hand," Rault said.

"Without security for the civilian population, there may not be sustainable economic development. One must not dramatize the situation more than it is but it is serious enough that security analysts voiced great concern," he said.

In 2009, Rault pointed out, U.S. administration officials considered the possibility that Mexico could become a failed state in the medium or long term.