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About Mexico:
Mexico was a country with an already advanced civilization before the arrival of the Spaniards, who ruled the country for over 300 years.
Spanish rule left a lasting legacy on Mexican culture even after over a hundred years of Mexican independence. Mexico is the largest Spanish-speaking country in the world, even outnumbering native speakers in Spain, which introduced the language to the country.
After gaining independence from Spain in 1876, Mexico underwent 50 turbulent years of economic hardships and political strife, largely caused by political repression and fraud.
Social and income inequities, exacerbated by a flawed land distribution system where large tracts of land (haciendas) were owned by a few landlords (hacienderos) and tilled by underpaid peasants barely surviving through subsistence farming, led to the Mexican Revolution from 1910 to 1917.
The armed conflict brought about a dramatic transformation of Mexico’s political, social, cultural, and economic system during the 20th Century, under a social democracy that was to play a significant role in the reconstruction of the country in the following years.
Under a social democracy, significant reforms were infused into the system through a model called Import Substitution Industrialization (ISI) that allowed local industries to expand their production. Other reforms included:

• Free land distribution to peasants under the concept of ejido, shared communal land
• Nationalization of oil and railroad companies
• Introduction of social rights into the Constitution
• Tolerance towards labor unions
• Infrastructure building

These reforms resulted in what economic historians call the Mexican Miracle, a period of rapid economic growth from 1930 to 1970, when GDP increased six-fold.
As a major oil producer, Mexico’s economic fortune slipped in 1981-1982 when oil prices plummeted and interest rates spiked in the world market, forcing Mexican President Lopez Portillo to devalue the peso, suspend foreign debt payments, and nationalize the banking industry. Mexico managed to end the crisis in 1982, but with lenders unwilling to give fresh loans to Mexico, the government was forced to devalue the peso further, resulting in record inflation that reached as high as 159.7% in 1987.
With ISI unable to work under a different scenario, Mexico signed the General Agreement on Tariffs and Trade (GATT) in 1986 as a first step towards trade liberalization. In 1992, Mexico also signed the North American Free Trade Agreement (NAFTA) along with the United States and Canada.
Largely through increased trade with its two major trading partners and the international rescue package designed by American president Bill Clinton, Mexico managed to wiggle out of the crisis and was growing again at an average annual rate of 5.1% between 1995 and 2000.
With its 2009 GDP in purchasing power parity estimated at $1.482 trillion and GDP per capita at $12,500, Mexico is firmly established as an upper middle income country and growing. Since the slowdown in 2001, the country quickly recovered and grew by 4.2% in 2004, 3.0% in 2005, 4.4% in 2006, 3.3% in 2007 and 1.3% in 2008, before posting a negative GDP rate of -6.5 in 2009.
Mexico's dramatic economic plunge in 2009 has been attributed to a low global demand for export products, but analysts believe this is just short-lived as Mexico is bound to commit another major economic rebound in 2010.