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Mexico City, the capital of Mexico, is a historical and multicultural city renowned for iconic landmarks like the Angel of Independence and the Basilica of Our Lady of Guadalupe. With a diverse population of over 21 million people speaking a variety of languages, it is a significant economic powerhouse and a blend of ancient architecture and modern innovation.
Mexico City, or Ciudad de México, D.F., is the capital of Mexico, a country located in North America, boundering on the north by the United States; on the south and west by the North Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of Mexico.
The term Mexico City also applies to the capital’s metropolitan area, which includes the Federal District, and is the most populous city in North America. The population of Greater Mexico City is 21.3 million, which makes it the second largest metropolitan area of the Western Hemisphere, and the largest Spanish-speaking city in the world.
Mexico City is also one of the most important cultural and financial centres in the world. It is located in the Valley of Mexico (Valle de México), a large valley in the high plateaus in the center of Mexico, at an altitude of 2,240 meters.
Mexico City has a subtropical highland climate due to its tropical location but high elevation. The average annual temperature varies from 12 to 16 °C, depending on the altitude of the borough. The temperature is rarely below 3 °C or above 30 °
Mexico City is the seat of the federal government. Scattered throughout the city are headquarters and offices for all of the federal executive, legislative, and judicial branches of government. For example, the president’s official seat of power is the National Palace although many of the day to day business are conducted at the official presidential residence called Los Pinos.
Mexico City and the Federal District are constitutionally defined as one and the same. Their shared area has gradually increased since the mid-20th century and is now subdivided into 16 delegaciones, or administrative areas, similar to boroughs. Many administrative functions are centralized, but other powers are divided among the delegaciones. In addition, the capital’s metropolitan area includes more than two dozen self-governing municipios.
Historically, its residents did not elect local leaders. The president would appoint a trusted party to serve as its chief of government (jefe del gobierno), or mayor. However, since 1997 the mayor has been elected by popular vote to a six-year term.
The city’s government, which is headquartered along the south side of the Zócalo, is structured much like the national government. The executive branch includes key secretariats, or ministries, such as a state secretariat and another that oversees public works and services. Other ministries deal with public safety, finance, environment, transportation and circulation, human welfare, and justice.
The mayor used to appoint its own followers to head each of the delegaciones, but since 2000 they have been directly elected.
In addition, the Federal District has a legislative assembly, similar to those of the Mexican states. Its members are elected to three-year terms.
Mexico City is one of the most important economic hubs in Latin America. The region produces 15.8% of the country's gross domestic product. More than three-fourths of the district’s income derives from the service sector, and about one-fourth derives from manufacturing.
According to a study conducted by PwC, Mexico City had a GDP of $390 billion, ranking it as the eighth richest city in the world and the richest in Latin America.
Agriculture and mining together account for only a tiny percentage of the metropolitan workforce. The demands for food, water, and fuel for an urban settlement the size of Mexico City are staggering. All of these supplies are brought in from increasingly distant places which means that tens of thousands of tons of food alone must arrive daily in order to meet demands.
Owing to its superior transportation infrastructure, Mexico City has remained the country’s principal manufacturing centre. However, the capital’s share of manufacturing employment has declined relative to service-oriented jobs, mostly because the heavier industries were forced to move in the 1990s due to the concerns over air pollution in the city.
Among the city’s light manufacturing enterprises are maquiladoras specializing in clothing, paper products, and consumer electronics. Chemicals, plastics, cement, and processed foods are also important.
The service sector has grown in the last decades, including banks and financial services, restaurants, hotels and entertainment, communications media, advertising and other business services, and government employment. Tourism has become an increasingly important component of the sector.
As one of the developing world’s financial capitals, Mexico City has numerous major national and international banks. Its financial institutions manage the vast majority of Mexico’s savings accounts and foreign investment. Its stock exchange has also grown rapidly and can be considered the pulse of the country’s economy.
Although many government agencies and offices have been moved outside of the capital since the 1990s, Mexico City retains the largest concentration of government jobs in the country.
Finally, in a vast metropolitan area as Mexico city, it is also important to consider the informal sector of the economy, which helps compensate for high official unemployment rates. It is difficult to quantify them but many residents of the city are employed in informal jobs hidden beyond ordinary sight, including those working as live-in maids and unlicensed child-care providers, as well as those engaged in more nefarious pursuits, such as drug dealing, prostitution, and black marketeering.
Mexico ranks among the easiest countries to do business in Latin America according to the World Bank’s Ease of Doing Business 2012 report. However, high crime rates prove problematic for businesses. The government is making efforts to encourage investments in key industries but the tax environment is not overly business friendly and labour markets are rigid. However, Mexico’s large consumer market and proximity to the USA provide significant opportunities for marketers of consumer goods.
Oil and gas, automotive, financial services, communications, retail commerce and tourism sectors are some of Mexico’s biggest industries. They all play a significant part in the economy of the country.
In the last few years, Mexico is scaling up positions in Global Competitiveness. Moreover, ranking the most competitive economies in Latin America, Mexico shows signs of progress to continue rising in the scale in the following years. According to the WEF, Mexico’s improvement is based on the efficiency of its domestic market, its openness to domestic and foreign competition, the flexibility and incentives provided by the labor market and the ease to access financial services.
Mexico stands out in different areas, such as administrative procedures to open a new business, construction permits issuance, investors protection, tax payment, access to credits, and simplification of foreign trade activities.
Mexico City has many modes of public transportation, from the metro (subway) system, to suburban rail, light rail, regular buses, BRT (bus rapid transit), 'pesero' minibuses, and trolleybuses, to bike share.
Its subway system is the largest one in Latin America, with 12 lines along 226 kilometers in 195 stations. Approximately, 7 million people use it every day. The subway is the most-used transport infrastructure but it is not enough to solve the mobility problems of an urban conglomeration of 20 million inhabitants.
Mexico City’s demand for road and public transport infrastructures is voracious; It has amongst the highest concentration of cars in the world. According to the Ministry of Road Transport, 5.5 million vehicles travel within Mexico City every day, with a further 5.1 million registered in the surrounding State of Mexico.
The traffic is so congested that cars travel at an average speed of 32km/h and 65% of the goods transported in the city take on average two and a half hours to reach their destination.
Some measures have been taken in recent years, such as the construction of the Autopista Urbana Sur or the government plan of launching 1,600 infrastructure projects, allocating $400 billion, to be spent by 2024.
Airports
Mexico City is served by Mexico City International Airport, the busiest in Latin America, with daily flights to the United States and Canada, Mexico, Central America and the Caribbean, South America, Europe and Asia.
AeromÃaxico (Skyteam) is based at this airport, and provides codeshare agreements with non-Mexican airlines that span the entire globe. The airport sustains 35,000 jobs directly and around 15,000 indirectly in the immediate area.
An alternate option is Adolfo López Mateos International Airport (IATA Airport Code: TLC) in nearby Toluca, State of Mexico.
As the second largest country in Latin America, Mexico is at the center of the region’s tech revolution, receiving almost a quarter of all of the venture capital funds in Latin America. Mexico has also been an entry point and significant market for global tech companies like Uber, Google, and Facebook in Latin America.
It stands out that Mexico was the first country in Latin America to pass a law to regulate fintech in March 2018. The law helps prevent money laundering and corruption, and clear up uncertainties about cryptocurrencies and crowdfunding technologies.
Mexican startups received the second highest level of investment in Latin America, after Brazil, in 2017. Most of those deals were in fintech (Konfio), edtech (Yogome), or e-commerce (Cornershop).
Mexico currently has around 238 fintech startups, a 50% increase from 2016. This figure puts Mexico even ahead of Brazil, which tends to lead Latin America in most tech industries. A combination of factors, including Mexico’s growing economy, widespread mobile coverage, low banking penetration, and an underdeveloped lending system, have pushed Mexican fintech to success. Almost 40% of fintech startups in Mexico focus on remittances or lending.
Mexico is more than just a regional power; it is well on its way to becoming a global one. With a young, highly-connected population that is transitioning to the middle-class, Mexico has the potential to lead much of Latin America’s tech ecosystem in coming years.Goldman Sachs predicts that Mexico will be the world’s fifth biggest economy by 2050.
For those reasons, since 2014, the Mexican government has committed over $600M to startups through the Instituto Nacional del Emprendedor (INADEM). According to INADEM data, 6000 companies and 73,000 jobs have been created as a result of these efforts.
In addition, Mexico is an extremely attractive territory for the latest mobility programs. For example, Uber has announced it plans to increase its dockless bike sharing and e-scooter service, Jump. Other local players include Mobike, VBike, Bird, Movo, and Grin Scooters.
