The U.S. economic crisis has negatively impacted Mexico’s exports. 80 % of their export trade is with the United States, including their #1 export, oil, which is down 35 %. Drug trafficking has been on the rise since the 1980’s, when U.S. drug enforcement efforts closed primary trafficking routes from South America through the Caribbean and into the US and Canada.

Thus, forcing the cartels to forge new routes from Central America, through Mexico and up in to the U.S. and Canadian markets. Mexican President, Felipe Calderón’s commitment to fighting the drug trade, since coming into power in 2006, has seen escalating retaliation. The H1N1 flu scare that hit Mexico City virtually ground the country to a stand still this past spring.

All of this has created a global perception that “Mexico” is unsafe and unstable.

How that has affected the beautiful & tranquil tourist destination of Puerto Vallarta, is apparent in the dramatic decrease in tourism. Already reeling from a particularly slow 2008/09 high season, the spring H1N1 flu pandemic saw tourism drop a reported 50-70% over previous years.

The impact on Puerto Vallarta and other Mexican tourist destinations has been further compounded by a frenzy of knee jerk media coverage, and a World Health Organization who were reluctant to pinpoint where in Mexico H1N1 virus cases were being reported so as not to give the impression that some areas of Mexico were virus free and therefore safe. Subsequently painting all of Mexico as a potential health risk! Further resulting in travel advisories, cancelled flights and rerouted cruise ships.

In fact only 2 cases of the H1N1 virus were ever confirmed in Puerto Vallarta. With the majority of Mexico’s cases being in Mexico City, 550 miles away.

Cartel drug violence has generally occurred in only 5 of Mexico’s 32 states, including the state of Chihuahua where the border town, Ciudad Juarez, has seen the most violence. Violent/drug related crime occurring in Puerto Vallarta’s state of Jalisco is very rare. Only 2.1 deaths per 100,000 inhabitants, compared to the state of Chihuahua at 50.9 deaths per 100,000.

With the tourism industry in Puerto Vallarta down substantially, local family run businesses are closing their doors, housing sales have fallen off, hotel occupancy rates are down and employees in all sectors are being laid off in droves.

Puerto Vallarta fights back! Introducing the lowest airfares and holiday packages in years, substantially reducing hotel room rates, 2 for 1 recreation & adventure tours and promotional specials on restaurant meals & entertainment.

From a national perspective the Mexican government has replaced customs agents with 700 more highly trained personnel, accepted a half a million dollar drug enforcement training program from Canada’s RCMP and a 1.4 billion dollar counter narcotic package from US congress. The Mexican Health Authority’s response to the flu pandemic is by and large considered exemplary. Development of the Ku-Maloob-Zaap oil fields, the Chicontepec offshore oil project and construction of a new refinery in 2010 will increase oil production and boost trade. Plus, a national media campaign to put Mexico back in the minds of tourists as a favored and safe travel destination.

With this year’s high season looming, Vallartans are holding their breath to see if their combined efforts will pay off!