ECONOMIC SECTORS OF MEXICO: MAIN CHARACTERISTICS - CULTURE VOCABULARY - 2025

The economic sectors of Mexico are the different areas of the economy that this nation develops. They are traditionally divided into primary, secondary and tertiary, according to the production phase in which the sector involved is found; Within each sector, activities are grouped according to their similarity to one another.

In this way, the primary sector is related to the extraction of raw material. For its part, the secondary sector is in charge of processing said raw material, and the tertiary sector is related to complementary or related activities to the previous sectors.

Mexico has a mixed economy; that is, it is made up of both privately owned and state-owned companies; the government also regulates economic activity. Currently, the economy of this country is among the top 20 largest in the world.

In total, there are 72 branches that make up the economic sectors of Mexico. The primary sector is made up of 4 activities, the secondary sector includes 56 and the tertiary sector has 12 activities. Among the economic sectors that make up the Mexican economy, the one that has the most impact is services: it contributes more than half of GDP.

Main characteristics of the economic sectors of Mexico

Primary sector

The primary sector is made up of agriculture, livestock, forestry (logging) and fishing. It is one of the vital economic sectors of Mexico, as it contributes to the development of the other two.

In the early 1980s, this country adopted an export-led growth model. Consequently, the primary sector began to experience an improvement.

The growth of agricultural activity was the main source of foreign exchange that allowed it to respond to capital imports and met the growing domestic demand for goods.

In the same way, it provided the raw materials demanded by the industry that was being born, and it provided abundant labor for the other productive sectors.

Important growth

On the other hand, during the 2013-2017 period the primary sector showed an increase of 12.4% of its GDP. It has also generated benefits for more than seven million women and men who work in this sector.

Thus, this sector has promoted Mexican self-sufficiency in most fruits, vegetables, beans, rice, and sugar. Its growth is still going strong, and it is approaching the same sufficiency in meat and dairy products.

Secondary sector

The secondary sector is one of the great economic sectors of Mexico. It is made up of mining and oil activities, and the transformation industry (manufacturing industry) of raw materials.

Mining and oil activities

The production of the mining industry represents 4% of its total GDP. This sector generates more than 352,000 jobs, according to economic data from 2017.

Approximately 80% of the Mexican mining industry deals with the extraction of precious metals and non-ferrous metals.

In addition, its mines produce 1.7% of the world's mineral production. In this sense, the Aztec country is the world's largest silver producer.

According to World Mining Data (2015), Mexico is the thirteenth world producer of mining products.

When it comes to oil, the Mexican nation is one of the world's largest oil producers. This statement is supported by a production of 2.1 million barrels per day in 2016.

Similarly, it is the third largest in America after the United States and Canada. According to records, in 2016 alone the United States imported more than 437 million barrels of heavy crude from Mexico.

Oil is a crucial component of the Aztec economy. The profits of the oil industry represent a high component of the Mexican GDP. Statistical data for 2016 show that it contributed about 32% of total revenue.

Transformation industry

This sector takes the production of the primary sector and manufactures finished products. These products can be destined for internal consumption or for export. Manufacturing can be divided into heavy industry and light industry.

According to IMF reports (2016), the nation would be occupying position 15 on the list of industrialized countries.

Starting in the eighties, historical data show that the contribution of manufacturing to the Mexican economy has experienced a constant decline. However, it has always remained above 30% of GDP.

Now, one of its most important industries is the automotive industry. Many of the major automakers have established operations in their territories. These include General Motors, Ford, Chrysler, BMW, Toyota, Honda, Volkswagen, and Mercedes Benz.

The Mexican auto industry has also gradually become more advanced. In its beginnings it was only dedicated to the assembly of parts; it later became a research and development center.

Third sector

The tertiary is one of the important economic sectors of Mexico. This sector has been increasing its performance since 2006. Thus, for more than 10 years it has reported more than 60% of annual GDP for Mexico.

This sector includes tourism, commerce, communications, services and transport. In turn, the tourist activity includes hotels and restaurants, and that of services includes various professional, financial and governmental services.

Similarly, this broad sector includes commerce, transport, communications, real estate activities and rental activities.

Figures from the Tecnológico de Monterrey Business School report an improvement in this sectorial economic division in the first quarter of 2018. During this entire period, it contributed 1.8% of the 2.2% registered in the increase in Mexico's GDP.

On the other hand, the services sector is expected to be a leading economic growth engine. This hope is based on the fact that the field of services occupies more than 50% of the Mexican workforce.

Information production is included in the tertiary sector. However, some economists do not consider it a service. Consequently, it is being considered to be included as another of Mexico's economic sectors: the quaternary.

References

1. Gutiérrez Lagunes, M.; González Ortíz, JH and Recio Reyes, RG (2014). The evolution of economic sectors in Mexico. Period 2004 - 2013. Taken from congreso.investiga.fca.unam.mx.
2. International Research Institute of Educational Technology. (s / f). Sectorization of the economy. Taken from gc.initelabs.com.
3. Martínez, A.; Salgado, A. and Vázquez, S. (2017, March 16). Recent trends in the primary sector in Mexico. Taken from bbvaresearch.com.
4. Secretariat of Agriculture, Livestock, Rural Development, Fisheries and Food.. (2017, September 05). GDP of the primary sector of Mexico grows 12.4 percent in almost five years: SAGARPA. Taken from gob.mx.
5. Mexico Country Commercial Guide. (2017, September 19). Mexico - Mining and Minerals. Taken from export.gov.
6. Pariona, A. (2017, April 25). The Economy of Mexico. Taken from worldatlas.com.
7. Cruz, M. and Polanco, M. (2014). The Primary Sector and Economic Stagnation in Mexico. Latin American Journal of Economics, Vol. 45, No. 178.
8. Mexico Country Commercial Guide. (2017, September 19). Mexico - Oil and Gas. Taken from export.gov.
9. Martínez, M. (2017, June 07). Secondary sector ballast productivity indicator. Taken from eleconomista.com.mx.
10. Economy Watch Content (2010, March 24). Mexico Industry Sectors. Taken from economywatch.com.