why mexico needs a fiscal reform? the territorial dimension paris, 26 march 2007
TRANSCRIPT
Why Mexico needs a fiscal reform?
the territorial dimension
Paris, 26 March 2007
1. Globalisation / Decentralisation
2. Growing disparities between regions
3. Ineffectiveness of conventional policies
and governance
Does this sounds like Mexico?
Territorial disparities in OECD Countries (gdp per capita 94-2000)
.20
0
.17
8
.15
9
.15
3
.14
5
.14
0
.13
6
.12
9
.12
6
.12
4
.11
6
.10
6
.10
1
.09
7
.08
9
.08
5
.08
2
.07
0
.06
7
.06
5
.05
7
.05
4
.04
6
.04
1
.03
4
.000
.050
.100
.150
.200
.250
ME
X
US
A
HU
N
ITA
DE
U
PR
T
CA
N
AU
T
SV
K
ES
P
GR
C
UK
D
PO
L
BE
L
IRL
NL
D
KO
R
FIN
FR
A
JPN
DN
K
AU
S
NO
R
CZ
E
SW
E
Economic Growth and Regional Disparities
Growth
3.5%3.0%2.5%2.0%1.5%1.0%.5%
Regional Disparity
4%
3%
2%
1%
0%
-1%
-2%
-3%
US
UK
Spain
Slovak Rep.
Portugal
Norway
Netherlands
Mexico
Japan
Italy
Hungary
Greece
Germany
France
Finland Denmark
Czech Rep.
Canada
Belgium
Austria
Australia
Adopting a ‘territorial approach’ ?
an example of what NOT to do…
factors of national growth are strongly localised
promoting national growth requires improving the use of these factors within regions
regional policies
1971 1996
When spending forgets the ‘regional dimension’: the case of Italy
Centre-West
South-Southeast
Centre
Northwest
Northeast
Individual and territorial disparities + unused potential
> Threats to Mexico’s competitiveness and cohesion
32 %
70 %
MEXICO: fiscal reform can’t ignore the regional dimension
3 key territorial challenges …and potential resources
Dispersion
Rural development challenges
Concentration
Urban developmentchallenges
+ cross-border dimension
Metro-urban dimension: the case of the ZMVM
Federal Government
Federal District State of Mexico State of Hidalgo
Delegaciones Municipalities Municipalities
Non-Governmental actors
metropolitan commissions…
do / can actors co-operate?
cost…63/66
1. Rural Mexico not synonymous with decline
2. …nor is synonymous with agriculture
Rural dimension
What is the spending strategy?
Cross-border dimension: Mesoamerica1. Strategic geo-political location
PANAMÁ
BELMOPAN
SAN JOSÉ
GUATEMALA
TEGUCIGALPA
Sto. Tomas
Flores
San Pedro Sula
Quetzal
Cutuco
MANAGUA
Limón
La Ceiba
ChetumalPUEBLA
CoataacoalcosVillahermosa
XPUJIL
Tuxpan
Tampico
SAN SALVADORKey
Pacific Corridor
Inter-oceanic corridors
Caribbean tourism corridor
SE Mexico highway expansion
Central andNorthern MexicoNorth America North America
Europe
Europe and South America
South America
Asia
NorthAmerica
SouthAmerica
Territorial approach: rethinking multi-level governance
Federal
Regional
Local
Upper Horizontal co-ordination
Mechanisms
Vertical co-ordination
Local horizontal co-ordination
Objetcive:
• Finding the right mix of knowledge/responsibilities/resources
Key issues
1) need to tackle the disparities issue
2) fiscal reform crucial for regional policy
3) regional policy can support fiscal reform
long-term vision, political commitment are key