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Seeing Mexico Through Blood-Tinted Glasses

Mexico is fast becoming a North American success story, though you wouldn’t know it from the coverage the country gets from most news outlets. That coverage tends to light on things like the massive and still-unexplained explosion that occurred Thursday afternoon at the headquarters of Pemex, Mexico’s state-owned oil company. At least 32 people lost their lives and 121 were injured. The press also tends to focus on news out of Mexico about rampant drug violence, gangs of thugs and tortured civilians, mounds of cocaine discovered at border crossings, and the like.

But there is also a more hopeful narrative taking shape in our neighbor to the south. The FT calls Mexico the “Aztec Tiger.” Foreign investors are scrambling over one another to get in on the bottom floor of a country poised for rapid growth.

This month, Larry Fink, who heads BlackRock, the world’s largest asset-management company, called Mexico an “incredible growth story”. Lisa Schineller of Standard & Poor’s, the rating agency, says the country’s BBB sovereign debt rating could be poised for an upgrade if Mexico enacts critical structural reforms.

Foreign investors have poured money in. During the first nine months of 2012, they funnelled $57bn into Mexican stocks and bonds – more than five times the amount they invested in Brazil during the same period. Little wonder the country’s IPC stock market index hit a record high this year. […]

International interest in Mexico has so far focused on the country’s prowess as a production base from where companies can export to the US. But [President] Mr [Enrique] Peña Nieto’s reforms are intended to cultivate a healthier environment for far broader investment throughout the domestic economy. He is seeking to introduce more competition in telecommunications and energy while taking steps to shake up the notoriously inefficient tax and educational systems.

The MSM doesn’t think their audience wants to read about this kind of news. A recent story by the Associated Press saw President Peña Nieto’s recent education, fiscal, and energy reforms not as an attempt to turn the country around but as a bid to sweep rampant drug violence under the rug. True, drug-related violence is a serious problem, and the new government is quietly trying hard to fight the cartels, which remain a powerful force across the country despite years of a military-led crackdown under the previous administration. “On the subject of security, [former] President Calderon went against all logic and turned it into the country’s only issue. . . . The theme itself is addictive for the media, and generates a negative social mood,” a spokesman for former President Vicente Fox told the AP. President Peña Nieto has promised to fight the cartels another way.

The explosion and stubborn problems with drugs, police corruption, and gang violence reveal that President Peña Nieto still has a lot of work to do. But the situation is better than you’ve heard. Mexico has a lot to be optimistic about.

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