Mexican Optimism and Economic Reality: An Analysis of the Mexican Industrial Development Plan

Abstract

The publication of the Plan Nacional de Desarrollo Industrial in March 1979 clarified and structured Mexico's oil-based development strategy. The initial reaction to the industrial plan was gen,erally good in business circles because it helped to reduce uncertainty about the future, but the industrial strategy has been questioned by different groups because of the overall ideological orientation and role of the government in the economy espoused by each. A more fundamental criticism of the plan can be raised, however, from a purely technical point of view. As the paper demonstrates, the plan is weak in its identification of several key economic relationships, makes unrealistic assumptions about certain exogenous factors and could be considerably improved upon at little cost or loss of goal attainment simply through rescheduling of several of its key expenditure streams.