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Mexico Is Catching Up to Brazil

11:05 AM, Sep 17, 2012 • By JAIME DAREMBLUM
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Yes, the drug war remains a huge problem for Mexico, but the country’s total number of homicides—including its total number of drug-related homicides—declined significantly in the first half of 2012 compared with the first half of 2011. There has been an especially large decline in onetime murder capital Ciudad Juárez, which boasted 215,000 export-sector jobs as of June, versus only 166,000 three years earlier. One could also argue that persistence of serious drug violence makes Mexico’s recent economic growth all the more impressive: According to the New York Times, the Mexican finance ministry “has estimated that the violence shaves at least 1 percentage point from GDP growth.”

While the drug warfare has undoubtedly hurt Mexico’s global reputation, Brazil actually has a higher national murder rate. In July, Brazilian sociologist Julio Jacobo Waiselfisz published a study showing that Brazil’s youth murder rate had increased by an astounding 346 percent between 1980 and 2010. “The numbers in Waiselfisz’s study rank Brazil as the fourth-worst among 91 countries when it comes to youth homicides, behind El Salvador, Venezuela and Trinidad and Tobago,” noted the Associated Press. More recently, on September 3, the Rio-based newspaper O Globo reported that Brazil had witnessed 22 homicides over the previous two months that were linked to its October 2012 municipal elections, and that, in response, more than 400 Brazilian towns had requested federal police assistance.

Clearly, both countries are struggling to combat violent crime, and both countries need better legal institutions. Both countries also suffer from structural economic weaknesses that call for bold political leadership. There have been encouraging signs that Brazilian president Dilma Rousseff and Mexican president-elect Enrique Peña Nieto (who takes office in December) are willing to provide that leadership. But making the necessary reforms will be difficult.

It is important to remember that the challenges facing economic reformers in Brazil and steeper than those facing reformers in Mexico. Indeed, when it comes to promoting economic freedom and a good business climate, Mexico is way ahead of the South American giant. In the Heritage Foundation’s 2012 Index of Economic Freedom, Mexico ranks 54th and Brazil 99th. In the World Bank’s 2012 Ease of Doing Business Index, Mexico ranks 53rd and Brazil 126th.

As for education, both countries have achieved success with conditional cash-transfer programs that incentivize parents to keep their children in school, and yet both are still plagued by low test scores and high dropout rates. That said, in the OECD’s 2009 Program for International Student Assessment test, Mexican students outscored their Brazilian peers by significant margins in all three test categories (reading, math, and science). And in the World Economic Forum’s newly released 2012-13 Global Competitiveness Report, Mexico ranks ahead of Brazil for the quality of primary education, the quality of math and science education, and overall educational quality.

There has been no shortage of euphoric commentary about the rise of Brazil. Perhaps journalists should spend more time exploring the rise of Mexico.

Jaime Daremblum is director of the Center for Latin American Studies at the Hudson Institute.

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