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October 2023, Volume 29, Number 4

Canada, Mexico

Canada added a million immigrants and temporary workers in 2022, and plans to admit 465,000 immigrants in 2023, 485,000 in 2024, and 500,000 in 2025. Most foreigners who are granted immigrant visas are already in Canada, often as foreign students or temporary workers.

There were 798,000 temporary workers in Canada at the end of 2022 and 807,000 foreign students. Many temporary workers are sponsored by their employers and provincial governments for immigrant visas, and Canada allows foreigners who graduate from Canadian universities to work while they study and during breaks, and to work for at least three years after graduation.

Many of the students who are recruited by brokers enroll in for-profit colleges that promise one-year work permits after eight months of study. After an increase from 350,000 to over 800,000 foreign students between 2015 and 2023, PM Justin Trudeau said that Canada may impose a cap on the number of foreign students.

Canada in July 2023 offered foreigners in the US with H-1B visas the opportunity to move to Canada and seek jobs. Those who find jobs can qualify for immigrant visas under the Canadian point selection system that favors foreigners who are young, have advanced degrees, and speak English.

PM Justin Trudeau, after eight years in office, reshuffled his cabinet in July 2023 in anticipation of national elections before October 2025. Trudeau in September 2023 said Canada may cap the number of foreign students to relieve pressure on the housing markets, where prices and rents have been rising.

Canada had its worst wildfire season in memory in 2023. In June, wildfires in northern Quebec led to poor air quality in cities from Montreal to Washington DC. Fires spread westward to the prairie provinces and northern territories, and led to a state of emergency in British Columbia in August 2023, where many of the 200,000 residents of metro Kelowna in the Okanagan wine country evacuated.

Ontario has 3,800 acres of greenhouse farms, including over half or 2,000 acres around Leamington. The farm value of the tomatoes and other vegetables produced in Ontario greenhouses was $1.3 billion in 2022, including tomatoes and bell peppers, 35 percent each, and cucumbers, 25 percent. There are about 10,000 jobs in Ontario greenhouses, including half around Leamington.

Employment and Social Development Canada (ESDC) in September 2023 reported that 94 percent of its investigations between April 2022 and March 2023 found employers of temporary foreign workers in compliance with regulations. Ontario farms employ 20,000 guest workers under the Seasonal Agricultural Worker Program or SAWP and the agricultural stream of the Temporary Foreign Worker program.

Mexico. Government agency Coneval reported that the number of Mexicans with below-poverty level incomes fell from 56 million in 2020 to 47 million in 2022, including nine million people who are in extreme poverty. Mexico’s poverty rate fell from 44 to 36 percent. Coneval uses several indicators of poverty, including no social security coverage (50 percent of Mexicans lack IMSS coverage) and lack of access to nutritious food (18 percent).

Coneval uses per-capita incomes of less than 4,200 pesos ($250) a month in urban areas, and 3,000 pesos ($175) a month in rural areas, to define income poverty. More government payments to the elderly and remittances were credited with reducing income poverty. President Andres Manuel Lopez Obrador took credit, saying that his policies of “for the good of all, the poor come first” were responsible for less poverty.

A third of Mexicans receive benefits under one of Mexico’s social programs. AMLO ended the widely praised conditional cash transfer program that underwent several name changes, from Progresa to Oportunidades to Prospera, and was copied in over 80 countries since 2000. Instead of payments to mothers who kept children in school, AMLO transferred money to the elderly without conditions, providing about 2,100 pesos per month to households receiving payments.

Two women will compete to replace President AMLO in June 2024 elections. The ruling Morena party nominated Claudia Sheinbaum, while the opposition National Action Party (PAN) nominated Xóchitl Gálvez. Mexico has gender parity in its federal Congress, and women are almost half of the representatives in the legislatures of the 32 states.

The Mexican peso strengthened to $1 = 17 pesos on summer 2023 as the central bank raised interest rates to 11 percent; the rate was $1 = 25 pesos in April 2020. Remittances were $61 billion in 2023, making Mexico second only to India in remittances. Mexico’s GDP grew by three percent in 2022 to $1.4 trillion, making it the14th largest globally.

Mexico exported goods worth almost $50 billion a month to the US in the first eight months of 2023. Exports included $350 billion worth of manufactured goods, $15 billion worth of farm commodities, and $22 billion worth of oil.

Mexico surpassed China as the leading source of US imports in the first half of 2023, a reflection of US decoupling from China. Two-way China-US trade was almost $700 billion in 2022, when Canada, China and Mexico vied as the top US trading partner. China accounts for a third of the world’s manufacturing value added, followed by the US contributing a sixth.

Mexico is the leading supplier of imported farm commodities to the US, supplying $34 billion of farm commodities in 2021. There are several reasons for Mexico’s emergence as a major farm exporter, including the free-trade NAFTA and USMCA agreements, good road and rail transportation links to the US, foreign direct investment in Mexico, and US buyers and partners who work with Mexican farmers to ensure that food safety and other protocols are followed on Mexican export farms.

The five commodities whose imports increased the most over the past decade were fresh berries, tequila, fresh avocados, beef and beef products, and beer. Growing US demand explains much of the increase in fresh berry and avocado imports.

Mexico exported a record 1.1 million tons or 2.5 billion pounds of avocados to the US in the year ending June 30, 2023. Mexico produces 2.5 million tons of avocados a year, and exports almost half. Michoacan (73 percent of Mexican avocado production) and Jalisco (12 percent) export fresh avocados to the US.

Haiti. As the poorest country in the western hemisphere continues to struggle with gang violence, the government asked the UN to endorse a plan to have Kenya lead an international police force of 10,000 or more to reassert control over Port-au-Prince. A previous UN peacekeeping operation in Haiti in 2010 was plagued by a cholera outbreak and sexual exploitation.

The Dominican Republic in September 2023 closed its border with Haiti to protest construction of a canal on the Haitian side of the Massacre River that divides the two countries in Hispaniola. The DR has 11 canals that divert water for its farmers.

Ecuador. Colombia and Peru are the major cocaine producers in Latin America, but Ecuador has emerged as a major transit hub, with cocaine sometimes smuggled in banana exports. Ecuador was the world’s largest exporter of bananas in 2022, shipping bananas worth $3.5 billion, followed by the Philippines, Guatemala and Costa Rica, each of which exported about $1 billion worth of bananas in 2022.

Presidential candidate Fernando Villavicencio was killed in August 2023 after turning the spotlight on drug gangs; some of whom moved from Colombia to Ecuador after a 2016 peace agreement between the Colombian government and FARC. Albanian and Mexican gangs turned Ecuador into a major transit hub for drugs bound for Europe and the US, with a homicide rate higher than that of Venezuela and Honduras.

Why has Latin America lagged behind East Asia in economic growth? One reason is macroeconomic instability, as in Argentina. Second is a relative paucity of high-return private investment projects, as in Colombia and Peru. Third is the mis-allocation of resources and insecurity, as in Mexico, and fourth is high real interest rates as in Brazil.

The combination of presidents and proportional election systems mean that presidents can stay in office without a working majority in the legislature. This means that presidents often fail to deliver on campaign promises, leading to voter frustration.

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