Security and Economic Recovery in Mexico

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Security and Economic Recovery in Mexico

Dr. Muhammad Akram Zaheer

In Mexico, the issues of security and economic recovery are closely connected. People in power and regular citizens both know that criminal groups in the country pose threats to both these aspects. While there is a general agreement that something needs to be done, there’s no consensus on the best way forward.This is partly due to the geography of Mexico, with its mountains, deserts, peninsulas and other features creating divisions that make it challenging for the central government in Mexico City to effectively govern all regions. This has led to power vacuums, giving rise to independence movements, warlords and even parallel governments throughout history. The current organized criminal groups, like the Sinaloa and Jalisco New Generation cartels are seen as a modern expression of this historical reality.

The federal government faces a challenge in dealing with the power these criminal groups have accumulated. One factor contributing to their strength is the significant number of defections from the Mexican armed forces. When Vicente Fox took office in 2000, his government changed its relationship with the military, leading to a loss of privileges, operational freedom, financial benefits and social status for the servicemen. This shift empowered the cartels, as they gained capabilities comparable to the forces meant to combat them.During the COVID-19 pandemic, cartels expanded their local influence at a low cost by providing essential goods in remote areas where the national government struggled. This allowed organized crime to deepen its presence in communities across the country.

These criminal groups now control significant parts of both the formal and informal economies. While they still engage in illegal activities such as human, arms, and narcotics trafficking, they also function like multinational corporations. Their leaders have business steps; they control all aspects of their operations, collaborate with subsidiaries and have strong connections with criminal groups in Latin America and the Caribbean. In the formal economy, they act as if they are part of government services, monopolizing local control of internet providers, pharmaceuticals and engaging in legal businesses like manufacturing and selling their own cigarette brands. Nationally, they impose taxes and quotas on industries like avocado and lime, and they have even made inroads into the beer market.

There’s a big problem in Mexico because criminal groups are getting more powerful in places where businesses usually operate. This is a threat to the country. In the past, their presence scared away foreign investors or made it more expensive to keep things safe. Now, it is a question of who controls different parts of the country’s economy. This is especially important as Mexico tries to recover from the pandemic. However, there is a disagreement among politicians on how to deal with this.One idea is to make deals with these criminal groups so they don’t cause trouble. The government would let them operate as long as they follow some rules. The benefit is that it might avoid violence, but the problem is it gives power to these criminal groups and weakens the government. Some people, especially in security and defense, don’t like this idea.

The other idea is to take a strong action against these criminal groups, trying to eliminate their power and corruption. This would need a lot of money and effort, and it might cause problems in the short term. It was tried before with not much success.Both ideas have pros and cons. The first might reduce violence but harm businesses and make it hard for foreign investors to trust the situation. The second could bring long-term gains but needs a lot of money and might scare away investors in the short term. Either way, implementing these ideas will face political challenges.On a bigger scale, this issue is about whether the government can control its territory and economy despite challenges from geography and history. One strategy wants to work within these challenges, while the other believes Mexico can overcome them if it’s willing to pay the price.