Mexico: the economic emergence of the United States' neighbor to the south.

• Author: Leithe, Joni L.

Mexico's Constitution does not reserve particular functions exclusively for the states; it does, however, specify services for which municipalities are primarily responsible.

Author's note: The December 1997 issue of Government Finance Review launched this two-part exploration of the economic, political, and governmental changes occurring in Mexico. Part II of the article is presented here and focuses on 1) sub-national governmental trends and 2) joint U.S.-Mexico initiatives. The economic information in these articles summarizes the work of Nora Lustig, of the Brookings Institution, and John Adams, Jr., Norwest Bank; information on local government in Mexico draws upon the work of R. Andrew Nickson. Their publications are cited at the end of this article.

State and Local Government

Mexico is a federal nation composed of 31 states and the Federal District of Mexico City, the capital. The states that border the United States are Baja California Norte, Sonora, Chihuahua, Coahuila, Nuevo Leon and Tamaulipas. There are 2,397 municipalities, most having very small populations; only 24 had more than 300,000 residents in 1980. The number and average population size of municipalities varies enormously among states. In 1992, the state of Baja California had only four municipalities, each with an average population of 306,359, while the state of Oaxaca had 570 municipalities, each with an average population of only 4,418. Dwarfing all other local governments in Mexico is the federal district of Mexico City, with its 14.4 million residents. The greater metropolitan area of Mexico City, embracing the federal district and 17 municipalities, has 20 million inhabitants and constitutes the largest metropolitan area in the world. One-quarter of the national population and half of national production is located there.

Functional Responsibilities. Mexico's Constitution sets forth a three-tier system of federalism that specifically references municipalities as a third order of government. The original 1917 Constitution did not clearly specify the duties of state and municipal levels of government, however, and in practice, state and local autonomy has not been respected. State governments have no functions exclusively reserved for them in the Constitution, but within their own Constitutions they can define the distribution of functions between themselves and their municipalities.

In 1984, a municipal reform amendment to the Constitution was enacted which specified for the first time the services for which municipalities would be primarily responsible and provided them with greater financial resources. Municipal services were defined to include water supply and sewerage; street cleaning, lighting, and maintenance; solid waste collection; parks; public safety and traffic; slaughterhouses; public markets and food supply centers...