Domestic Policies for Sustainable and Economic Development in Countries With Emerging Economies: A Case Study of Mexico

Introduction

One of the biggest problems that arise worldwide is global warming due to the high rate of emissions from the industrial, electrical, and transportation sectors mainly, this has proven the formulation of a set of strategies delivered by the United Nations Organization (UN), as an international agenda seeking to align the countries that belong to this alliance. One of the biggest problems that arise worldwide is global warming due to the high rate of emissions from the industrial, electrical, and transportation sectors mainly, this has proven the formulation of a set of strategies issued by the United Nations Organization (UN), as an international agenda seeking to align the countries that belong to this alliance. Mexico has participated in these initiatives to mitigate climate change and has directed its efforts to implement and develop Clean Development Mechanism (CDM) projects.

However, it must offer more strategies to promote the energy transition to clean and efficient technologies necessary for a low-carbon economy. Prospects have been more campaign-oriented or for the benefit of large concessionaires in the country, without focusing on continuity between governments that have alternated in the change of government. Among the initiatives that Mexico has participated in is the Kyoto Protocol, despite implementing different strategies to achieve the goals, which were not enough.

This chapter aims to propose the integration of domestic and fiscal policies for the sustainable development of countries with Emerging Economies: Case Study Mexico, considers including economic and environmental policies through the involvement of stakeholders, based on the assumption that these strategies would allow countries with emerging economies to have economic and social development.

Currently, the search for sustainable development in the country is hindered by economic and political support for conventional energy, where the installed capacity's participation in the energy matrix is over 90%, with a high percentage of fossil fuel extraction of over 50%, natural gas with a greater than 37% share, coal with around 6%, and large hydroelectric plants that have a negative impact on aquatic flora and fauna (IRENA, 2023)

In the year 2013 government period, modifications were made to Mexico's laws, seeking the economic opening of new markets. Energy perspectives continued to mark an over-exploitation of fossil resources by more than 100% and natural gas in more than 50% of the generation percentage (SENER, 2016). Modifications were made to several normative and institutional laws, such as the Mexican political constitution and the electric industry law. This political proposal, the Energy Reform, did not contain indicators or incentives for reducing carbon footprint and developing green projects in different economic sectors (Torne, 2019). Regardless of changes in government, it was contained without fulfilling its established objectives.

Instead, the policies that directed government efforts towards sustainable development sought deep oil well extraction. Still, the country's legal framework modifications had the advantage of foreign economic inclusion for promoting renewable energy generation projects for more significant sustainable development. Due to the potential of renewable energy in Mexico, the central technological transfers that have been enabled in projects with investment from the Mexican government in the foreign private initiative have been wind energy generation in the main area of the country and photovoltaic energy in the northeast, not reaching the generation of electricity with the sum of all renewable energies, nor even 10% of the country.

Currently, due to Mexico's socioeconomic situation, where its economy is in an emerging conjectural moment, and due to various economic crises, the government has opted for subsidies in the electricity tariff system, such as the agricultural and the domestic sector, especially in some border areas of the country due to extreme climates, where temperatures reach up to 50° Celsius in the summer.

Due to the country's geopolitical conditions, subventions favor the well-being of vulnerable groups. They have also maintained little interest in creating public policies and developing programs that promote using renewable energies as an alternative to diversify the country's energy matrix with green options that contribute to reducing greenhouse gases. Developing countries have the greatest opportunities for capitalizing on environmental and economic sustainability synergies. A green growth approach is a chance for emerging and developing economies to leapfrog unsustainable and wasteful production and consumption patterns (UN Environmental Programme, 2022).