We pick up a news magazine called Inside Mexico and the April issue has a Special Report on NAFTA. Included in this report was some surprising information....that because of NAFTA Mexico is now more attractive to retirees and other expats because they can find all the comforts of living in the USA plus reasonably priced housing, great climate and scenery. The article quotes several studies that estimate that approximately one million baby boomer expats are living or wintering in Mexico. And since the US Census Bureau estimates that even more baby boomers are reaching retirement age, this one million figure could continue to grow until at least 2025.
Now all of that doesn't surprise me too much, but then the article quotes Walter Russell Mead, a Senior Fellow at the Washington, D.C. based Council on Foreign Relations that each boomer household contributes on average, about $55,000 USD annually to Mexico's local economy. WOW!
Even if you think that $55,000 is too much, what about $45,000.....and that multiplied by one million baby boomers households, $45 billion USD. Or if you want to cut the $45 billion in half because you assume that there are two people in each household then you are still talking about $22.5 billion pumped into the Mexican economy annually.
Either way it is still a lot of dollars especially when you compare it to the $43 billion USD per year brought in by petroleum exports which is currently ranked as Mexico's top revenue source, followed by maquiladora exports and then by remittances, the money sent back to Mexico by the Mexicans in the USA. In 2006 the Dallas Federal Reserve Bank estimated that the Mexican workers sent a record $23.1 billion back home to Mexico.
I had not really thought about us expats being such a significant source of revenue for Mexico although recently a kind of satisfaction survey by the Mexican Government has been circulating among the expats. Maybe the numbers are right. The article in Inside Mexico about NAFTA and the Baby Boomers is a pretty interesting take on NAFTA. Here is a link so you can download the PDF and read it for yourself.
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3 comments:
Felipe Calderon is doing is best to prepare Mexico for a day when the oil runs out. Modernizing the tax system, etc. And when that sad day comes (sad for both Mexico and the U.S. which uses a lot of that oil), U.S. retirees will become the main gusher of the Mexican economy. Or at least of the "export" sector. Interesting.
It's amazing once you start to look at the numbers what weird things you uncover.
Thanks for this interesting tidbit. I hope to be doing more supporting of the Mexican economy someday. Until then, I envy your considerable support.
Regards,
Kim G
Boston, MA
As more and more boomers Boomerang and become the Vaboomer Generation--leaving their old lives and reFiring rather than entering traditional reTirement, my guess is that more will head south to Mexico. I was sorely tempted this past winter to join a cousin in her beach breakfast of freshly caught fish. Photos sent via email. There I was slogging away in damp cold NJ. Will all the creativity and fire of the boomerangers that I am encouraging at www.vaboomer.com head south becuase they can no longer afford to live in the US?
Absolutely fascinating. Thanks Bilie.
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