The Fourth Industrial Revolution – the theme of Davos 2016 – describes an era of innovation, where cutting-edge technologies are constantly disrupting industry. This trend will not only continue but intensify, transforming every step in the way we produce, distribute and consume. We have to prepare our economies and societies to successfully take advantage of these changes.
By H.E. Enrique Peña Nieto
President, Government of Mexico.
The Fourth
Industrial Revolution – the theme of Davos 2016 – describes an era of
innovation, where cutting-edge technologies are constantly disrupting industry.
Image Attribute: H.E. Enrique Peña Nieto at WEF Davos 2016, Source: Youtube Screengrab
This trend will not only continue but intensify, transforming every step in the
way we produce, distribute and consume. We have to prepare our economies and
societies to successfully take advantage of these changes.
I believe this
means focusing on three key areas: education, the business environment and
connectivity.
Education for
a New World of Work
Since we know
that Mexico’s most valuable competitive advantage is its human capital,
education is crucial. At the elementary level, we recently launched “Education
Infrastructure Notes”, private investment vehicles that will allow us to
channel approximately 3 billion dollars to improve school facilities within the
next 3 years. In addition, in the current school year, we have delivered more
than a million tablets to almost half of the 2.3 million fifth grade students.
Today, over
110,000 students graduate each year in targeted areas such as engineering,
manufacturing and construction, a higher figure than in some of the most
developed countries, like France, Germany and the United Kingdom. We want
present and future generations to have the skills they need to thrive in the
new workplace.
To that end,
we are increasing public investment in science and technology at universities
and public research centers all over the country. In the last three years
alone, the number of scholars in our National Researchers System has increased
by 26%, while we have almost doubled Mexico’s expenditure on research,
development and innovation.
In the Fourth
Industrial Revolution, the links between government, industry and academia are
more important than ever. To support our economy, we have increased the number
of technology transfer offices to share knowledge and support the development
of new products and businesses, in areas such as biotechnology, energy and
information technologies.
I believe this
means focusing on three key areas: education, the business environment and
connectivity.
Creating the Right environment
At the same
time, to improve the business and investment environment, we have made major
strides towards macroeconomic stability. Our central bank has established an
independent monetary policy that ensures price stability and low inflation. In
fact, in November, the inflation annual rate was 2.21%, the lowest in country’s
history. In addition, Mexico’s debt remains low and diversified. The expected
debt to GDP ratio is 46.9% for 2015, which contrasts with Latin America's
average of 55.6%. Moreover, the Mexican debt to GDP ratio is expected to
stabilize at 47.8% by 2016.
Likewise, to
foster a business-friendly environment, our energy reform has led to greater
competitiveness, by lowering the cost of electricity tariffs, eliminating the
monthly rise of gasoline prices and expanding gas pipelines throughout the
country. For the first time in decades, private capital investment is allowed
in all sector activities. It is estimated that this strategy will attract more
than 12.6 billion dollars of investment every year. By the same token, our
telecommunications reform enabled foreign investment, lowering fixed and mobile
phone services prices, and improving quality and coverage.
Entrepreneurs,
as well as micro, small and medium sized enterprises, are the main driver of
Mexico’s economy. We are using digital tools to make it quicker and easier for
entrepreneurs to go through the process to start up their own businesses, while
facilitating their access to commercial bank funding. Our Young Credit Program
gives entrepreneurs a loan for up to 9,000 dollars. If what they need is to
consolidate an on-going business, this loan could be for up to 150,000 dollars.
Improved Connectivity for the 21st century
Connectivity
is the key in an increasingly digital economy. Mexico is one of the only
nations in the world whose constitution formally recognizes the right of its
people to a broadband internet connection. The goal is to connect 70% of
households and 85% of micro, small and medium-sized enterprises to high speed
internet. In order to reach this target, we have established 65 thousand public
places with broadband internet connection, such as schools, libraries and
squares.
In the same
way, we are channeling more than 460 billion dollars for infrastructure, to
successfully integrate Mexican products and services into the 21st century
global economy. Mexico has become a manufacturing powerhouse. It is one of the
top global sellers of TV sets, vehicles, auto-parts, computers and cellphones,
among several other products. With improved infrastructure, we will certainly
reinvigorate our competitiveness, by setting the stage for expanding the value
and variety of our high-tech, export-oriented industries.
With that aim,
we are building and modernizing thousands of kilometers of roads and highways,
as well as improving our mass transit and railway systems. Besides, we will
construct a new Mexico City International Airport and will almost double our
seaports capacity on the Pacific Ocean and the Gulf of Mexico, among other
large-scale infrastructure projects. Our aim is to make Mexico a world-class
logistics platform.
Since we know
they are a powerful engine for economic growth, Mexico is committed to continue
boosting commercial exchanges. Over the last three years, we have expanded our
network of free trade agreements (FTAs); we have joined the Pacific Alliance
and, more recently, the Trans-Pacific Partnership. With them, our country will
sum 13 FTAs that provide preferential access to 52 countries with 1.3 billion
potential consumers.
Conclusion
In sum, we
have made key decisions to break the barriers to the use of information and
communication technologies and to reduce the digital gap in our society. Like
many countries, we face challenges. Our industry and businesses demands
increasingly specialized professionals in a wide range of knowledge areas.
Besides, 9% of the total national population live in remote rural communities
that require improved connectivity.
Now, in Davos,
we should look further and provide our citizens and businesses with the
necessary tools to take advantage of the opportunities that the Fourth
Industrial Revolution will bring. We must make it possible for next generations
to reach their full potential in an ever-changing world.
About The Author:
H.E Enrique Peña Nieto, President, Government of Mexico. Enrique Peña Nieto is a Mexican
politician and currently holds the office of President of Mexico. His six-year
term began in 2012. He is a member of the Institutional Revolutionary Party
(PRI) and served as governor of the State of Mexico from 2005 to 2011.
Source: World Economic Forum
