"Poor Mexico! So far from God and so close to the United States.” The proximity to the largest economy in the world gives Mexico a special position among developing countries. Hailed by international institutions for its market-oriented reforms and good economic management, Mexico was seen as a model to follow for other developing nations. So what lessons canbe learned from Mexico’s experience? Loaded with promises, the North American Free Trade Agreement is part of a trend toward regional economic integration. At the time NAFTA was signed, it was considered a radical experiment, the first free trade area between the Thirst and the Third World. Free trade proponents considered it sufficiently powerful to push a developing economy into the First World. More generally speaking, the Mexican experience serves as a test for globalization. However, while the Mexican government neglected other policy areas, the global environment became increasingly competitive. Countries like China present...