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Email this citationCIAO DATE: 01/04
NAFTA and Small Business Competitiveness in Mexico: The Impacts of Free Trade, Macroeconomic Policy, and Firm Management
Jerry Haar, Catherine Leroy-Beltrán and Oscar Beltrán
North South Center
University of Miami
Agenda Paper #64
April 2003
What have been the effects of North American economic integration on small and medium-sized enterprise (SME) competitiveness in Mexico? What is the nature and extent to which NAFTA-related policies facilitate or impede the performance of Mexican SME suppliers? This paper attempts to answer those questions. It also identifies government, industry, and firm-specific actions and strategies needed to strengthen, enhance, and sustain the Mexican SME sector.
Two winning sectors for Mexico under NAFTA - apparel and plastics - and two losing sectors - textiles and printing/media - are analyzed to determine the extent to which the trade agreement itself, Mexican macroeconomic policy, and firm-level behavior affect competitiveness.
Findings reveal that regardless of the sector (winner or loser), macroeconomic policy choices, or NAFTA’s provisions, the single most important determinant of success is the management of the firm, including vision, leadership, entrepreneurial attitude and behavior, and decisions related to finance, marketing, production, and the deployment of human capital.
