Mexico has a free-market economy with a mixture of modern and outmoded industry and agriculture, increasingly dominated by the private sector. The number of state-owned enterprises in Mexico has fallen from more than 1,000 in 1982 to fewer than 200 in 1999. The administration of President Ernesto Zedillo[?] continued a policy of privatizing and expanding competition in sea ports, railroads, telecommunications, electricity, natural gas distribution, and airports which was initiatied by his predecessors Miguel de la Madrid[?] and Carlos Salinas de Gortari.
A strong export sector helped to cushion the economy's decline in 1995 and led the recovery in 1996-1999. Private consumption became the leading driver of growth, accompanied by increased employment and higher wages. Mexico still needs to overcome many structural problems as it strives to modernize its economy and raise living standards. Income distribution is very unequal, with the top 20% of income earners accounting for 55% of income.
Following 6.9% growth in 2000, real GDP fell 0.3% in 2001, with the US slowdown the principal cause. Positive developments in 2001 included a drop in inflation to 6.5%, a sharp fall in interest rates, and a strong peso that appreciated 5% against the US dollar. Trade with the US and Canada has tripled since NAFTA was implemented in 1994. Mexico is pursuing additional trade agreements with most countries in Latin America and has signed a free trade deal with the European Union, putting more than 90% of trade under free trade agreements and lessening its dependence on the US.
Mexico is the most populous Spanish-speaking country in the world and the second most-populous country in Latin America after Portuguese-speakingBrazil. Some 60% of the population is of a mixed ethnicity known as mestizo, with 30% being Amerindian and some 9% of European descent. The country is predominantly Roman Catholic (89%), with some 6% adhering to various Protestant faiths and the remaining 5% either to other smaller religions or is unaffiliated.
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