Economy of Oaxaca
economy of the region
According to the Mexican government agency Conapo (National Population Council), Oaxaca is the third most economically marginalized states in Mexico. The state has 3.3% of the population but produces only 1.5% of the GNP. The main reason for this is the lack of infrastructure and education, especially in the interior of the state outside of the capital. Eighty percent of the state's municipalities do not meet federal minimums for housing and education. Most development projects are planned for the capital and the surrounding area. Little has been planned for the very rural areas and the state lacks the resources to implement them. The largest sector of Oaxaca's economy is agriculture, mostly done communally in ejidos or similar arrangements. About 31% of the population is employed in agriculture, about 50% in commerce and services and 22% in industry. The commerce sector dominates the gross domestic product at 65.4%, followed by industry/mining at 18.9% and agriculture at 15.7%.
In May 2010, Standard & Poor's raised the rating of the state from ‘mxBBB+’ to ‘mxA-’ with a stable outlook. Much of the reason for this is the better administration of public funds and better balanced budgets despite cutbacks in federal subsidies.
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