Mexico’s secretary of the economy discusses nation's globalized future at Convergence Lab panel

Mexico’s Secretary of the Economy and Arizona State University alumnus Ildefonso Guajardo reflected on the future of a globalized Mexico at the latest Convergence Lab ASU event in Mexico City on Nov. 19, an event that brought together ASU and Thunderbird School of Global Management alumni, as well as a number of academics and media outlets who follow ASU activities in Mexico. 

Guajardo was interviewed by TV anchorwoman Ana Paula Ordorica, and their conversation was followed by a panel that included Robert Grosse, Thunderbird School professor and director for Latin America; Amy Glover, CEO of Speyside Mexico; and John Santa Maria, the director general of Coca-Cola Femsa.

The event took place ahead of a packed week for the secretary, which would include attending the G-20 meeting of heads of state in Buenos Aires, where President Donald Trump will join the leaders of Canada and Mexico in signing the updated revision to the North American Free Trade Agreement, now known as the USCMA; and attending the Dec. 1 swearing-in of Andrés Manuel López Obrador as next president of Mexico, signaling the end of Guajardo's six-year cabinet tenure.

At the ASU event, Guajardo told the Convergence Lab audience that Mexico is far more connected to the outside world than it was a generation ago, and that the process of opening up the country’s economy hadn’t merely been a question of signing free-trade agreements with willing partners, but of also building internal capacity to be more globally competitive. He said Mexico had been playing catch-up in so many areas, citing anti-trust policy and laws as an example, an area in which the United States with its Sherman Antitrust Act had a century’s head start over Mexico. Likewise, while Mexico’s economy has demonstrated that trade can create decent jobs, the country still lags behind when it comes to entrepreneurship.

The secretary of the economy also acknowledged that the exuberance around globalization of a few years back has given way to wary reassessments in many quarters of the world about the costs and benefits of great economic interdependence across borders. He said people were too quick to forget that the postwar global economic architecture was designed in part to give preferential treatment to emerging and underdeveloped nations, “but someone seems to have forgotten that foreign policy requires consensus in a democracy,” and that any consensus for the status quo would be difficult to sustain once emerging markets emerged, seemingly at the expense (at least in terms of the political narratives) of the less educated workers in developed world.  Hence the current blowback against globalization in many countries, where domestic economic “losers” are taking political control.

Guajardo remains optimistic about the long-term role of “a globalized Mexico” in the world, but cautions against considering any trade deal between Mexico and the U.S. as a cure-all panacea, noting that these treaties “aren’t the antidote to all commercial tensions, but they do provide a mechanism for resolving them.”

In the second segment of the event, the panel moderated by Ordorica explored what the future of a globalized Mexico means for its growing number of multinational corporations. Grosse and Glover cautioned against an overreliance on the American market. Living in the shadows of the world’s largest single market and being so tied to it culturally and economically, it’s hard for Mexican business to engage the rest of the world as much as it should. Grosse also said that despite its largely positive strategic position, Mexico and its companies need to invest more in research and development, an area in which they lag behind Brazil. Grosse also said that Mexican companies should do more to insert themselves in valuable global supply chains and think about doing a better job of marketing its own brands overseas. Glover concurred, and added that one thing she’d still like to see is for Mexico’s growing number of homegrown multinationals “bet on inclusivity and diversity in their workforce, not as a matter of social justice, but for their own competitiveness and growth.”

Santa Maria, whose company does business in more than a dozen countries, acknowledged that when FEMSA started doing business in South American countries, “we assumed we already knew how to sell Coca-Cola there, or operate a convenience store, that it was the same as back in Mexico,” but that such an attitude was a mistake.  “We really need to understand our consumers in each market, discover their preferences, and cater to them.  Every market is different, and even within one country you can have several different and distinct markets.”

As for learning about other markets, Guajardo, whose parents didn’t attend school past the sixth grade, also mentioned at the event that one of his big breaks in life came in college when he persuaded the person at the Universidad Autónoma de Nuevo Leon who oversaw scholarships to ASU under an exchange program at the time to let him come to Tempe for graduate studies.  “I didn’t speak a word of English when I was 20, but I talked my way into the program by saying I would be studying economics, and it’s all numbers anyway.”

You can’t plan your life too far ahead these days, Guajardo said, noting that the planning periods of our careers keep getting shorter. “Life is like a game of connecting dots, with each dot serving as an inflection point that when added to all the others in a sequence, as time unfolds, create the story of who you become.”

On a far more prosaic note, Guajardo was presented at the event with a pitchfork T-shirt and something especially meaningful to him: a gift certificate to his favorite ASU hangout: The Chuckbox burger joint on University Avenue. 

“I might have some free time to stop by soon,” he said with a chuckle, considering the dots yet to be connected down the road.

Written by Andrés Martínez