11. The New Federalism, Internationalization and Political Change in Mexico: A Theoretical Analysis of the Metalclad Case
- Author:
- Arturo Borja
- Publication Date:
- 02-2003
- Content Type:
- Working Paper
- Institution:
- Centro de Investigación y Docencia Económicas
- Abstract:
- In this working paper the reader will find a study of the case that led, within the North America Free Trade Agreement, to the first formal dispute between an American firm and the Mexican Government. The firm, Metalclad, invested $22 million in the municipality of Guadalcazar, in the state of San Luis Potosi, to build a plant to process and store industrial waste. The proper disposal and storage of industrial waste represents one of the toughest environmental challenges faced by Mexico. Thus, the federal government, in the 1990s, has made efforts to attract foreign investment to this area. Metalclad, however, got into a dispute with the municipal and state governments. Finally, in December 1995, the former officially denied Metalclad a construction permit for the plant. This action meant, in practice, the end of the investment project.
- Topic:
- Economics, Industrial Policy, and International Trade and Finance
- Political Geography:
- America, North America, and Mexico