Because Mexico maintained its commitment to open markets, the country's economy has started to grow again. To put this in perspective, this is slightly more than half of all of our exports to Latin America, and makes Mexico our second largest trading partner. In three out of the last four years, exports have increased by more than twenty percent each year, and more than three out of every four dollars Mexico spends on foreign goods are spent on U.S. products. But this is also positive in that some cases, this has meant displacing Asian imports with little or no U.S. content. In contrast, close to two-thirds of the value of Mexican apparel imports in 1996 was comprised of U.S. content.
Competition forces companies to continually improve their products and services in order to survive.
Consumers reap these benefits through lower prices, products that meet their needs more effectively, and a wider range of selection. Let's not forget that one of the reasons that U.S. inflation has remained so low over the last five years is due to the competitive economic environment. U.S. companies benefit from the increased purchasing power of Mexican businesses and consumers. While the Mexican economic crisis had a serious impact on the country's economic confidence, sales figures from my own company and anecdotal evidence from other companies indicate that, at the retail level, Mexican consumer confidence is increasing. This increased purchasing confidence, ability, and power will only continue to benefit U.S. producers in the long-term.