The State of San Luis Potosí helps to propel growth across Mexico

The state of San Luis Potosí has played a pivotal role at numerous junctures in Mexico’s rich and diverse history. The land marked a crossroads between different cultural regions – Mesoamerica and Aridoamerica – and was home to a number of tribes, such as the Otomi and Chichimeca, for millennia. Like many regional groups, their religion and culture were characterised by the worship of celestial bodies, with the noticeable development of society appearing during the first millennium CE.

With the arrival of conquistador Hernán Cortés in 1522, a majority of the indigenous inhabitants of San Luis Potosí died as his forces conquered much of the territory, although small numbers of the Náhuatl, Huasteco and Pame groups still live in the southeast of the state. The Spaniards divided the area into encomiendas (a tract of land or village), which were subsequently gifted to the soldiers.

Colonisers Strike Gold

In 1592 gold and silver deposits were discovered in Villa de Ramos and Guadalcázar. As mines began to open, Spanish miners flocked to establish the town of San Luis de Mezquitic on the site of the modern state capital, San Luis Potosí. The state itself was named San Luis Rey in homage to Louis IX of France, who is also the city’s patron saint. Potosí was affixed to the name in an attempt to evoke the legendary mineral wealth of Bolivian silver mines that saw a once small Andean outpost become one of the Western Hemisphere’s most important and affluent early settlements.

In the 17th and 18th centuries Franciscan, Augustinian and Jesuit missionaries arrived in the area, constructing many of the churches and buildings that survive as museums and universities today. It was at this time that the economic potential of the region became increasingly apparent.

Independence to Revolution 

After Mexico’s independence from Spain with the proclamation of the Plan of Iguala in 1821, San Luis Potosí began to manoeuvre itself as one of 22 provinces formed by the break-up of the colonial structure. After the overthrow of Emperor Agustín de Iturbide, in 1824 Mexico drafted its first constitution, which transformed the country into a federal republic. San Luis Potosí was subsequently designated a free and sovereign state, and was run as an independent republic between 1826 and 1835, at which point Mexico was centralised and state governors were appointed by the federal government.

The Mexican-American War began in 1846 in the wake of the US government’s 1845 decision to annex the Texas territory, which was not recognised by the Mexican government. Ending in 1848, the armed conflict saw the state play an important role in repelling a US invasion from the north, for which it was honoured with the name San Luis de la Patria.

In 1863 the city became the capital of the country under President Benito Juárez, who was forced to govern Mexico from its peripheries in partial exile as the short-lived monarchy of Emperor Archduke Maximilian I of Habsburg ruled over parts of the country in 1864-67. Following years of uncertainty and violence, army general Porfirio Díaz ascended to power, and with his autocratic porfiriato regime secured relative peace, opened Mexico up to foreign investment and promoted infrastructure development until more violence ended his reign in 1910.

In 1866 a telegraph line was opened between San Luis Potosí and Mexico City, which helped catalyse the industrialisation of the state. In June 1889 a railway line was constructed between San Luis Potosí and the neighbouring city of Aguascalientes some 160 km to the west, and in April 1890 the first train left the city bound for the Atlantic port city of Tampico, which is still a key export destination for goods manufactured in San Luis Potosí today.

The city is considered the cradle of the Mexican Revolution, as the call to arms known as the Plan de San Luis was signed there in 1910. The revolution saw popular leaders such as Pancho Villa, Emiliano Zapata and General Álvaro Obregón rise to prominence with the signing of a new constitution in 1917 that put an end to the bloodshed. San Luis Potosí contributed Pedro Antonio de los Santos and Saturnino Cedillo to the pantheon of national heroes to gain fame amid the chaos of the revolution.

20th Century

The Institutional Revolutionary Party (Partido Revolucionario Institucional, PRI) won a remarkable 12 consecutive elections from its foundation in 1929 until 2000, ruling Mexico uninterrupted for 71 years. Over this period, the party presided over the country’s milagro económico (economic miracle) with four decades of sustained growth and expanding public spending underpinned by the development of Mexico’s oil industry, led by Petróleos Mexicanos, also known as Pemex.

In 1994 the sudden devaluation of the local currency against the US dollar, coupled with falling international oil prices, led to the Mexican peso crisis. Colloquially referred to as the Tequila Effect, the debt crisis was felt across Latin America as market confidence was struck by Mexico’s inability to keep up with repayments on international debt. In addition to billion-dollar bailouts from the US government and the IMF, the long-term stabilising force was the North American Free Trade Agreement (NAFTA), ratified by the leaders of the US, Canada and Mexico in 1993 and coming into force on January 1, 1994. The signing of NAFTA created the largest free trade bloc in the world and stimulated the growth of Mexico’s agricultural and manufacturing export sectors, easing its reliance on oil.

Cultural Heritage

San Luis Potosí’s culture is a fusion of pre-Columbian and Hispanic traditions. Food is a particular source of pride, with the indigenous dish tenek y zacahuil (steamed dough wrapped in a banana leaf) and enchiladas potosinas (stuffed corn tortillas in a spicy red sauce) among the highlights. Local dance and cultural events are interspersed with a frequent Catholic celebrations. The Silent Procession sees members of various Catholic brotherhoods parade through the streets wearing pointed hoods on Good Friday, while Saint Sebastian’s Day in January combines regional dance, music and fireworks. Meanwhile, Saint Louis’ Day, celebrating the city’s patron saint, brings artisans to the capital to sell their traditional crocheted goods made from wool or cotton.

Geography & Climate 

The state of San Luis Potosí lies 359 km north-west of Mexico City and is located in the centre of an advantageous triangle between three of Mexico’s largest cities – the capital Mexico City, Monterrey by the northern border and Guadalajara to the west. Most of the state’s 61,138-sq-km surface area – about 3% of the national territory – is set on a high plateau, with the capital 1864 metres above sea level and its highest peak, the Cerro Grande, at an elevation of 3180 metres. It is bordered by the states that make up the Bajío region, a loose agglomeration of territories with similar economic objectives (see Economy analysis). Included in this region are Jalisco to the south-west, Zacatecas to the west, and Guanajuato and Querétaro to the south. San Luis Potosí also shares state boundaries with Hidalgo, Veracruz, Nuevo León, Tamaulipas and Coahuila.

The state is bisected by the Tropic of Cancer, and its climate is semi-arid with fairly stable temperatures. Only a handful of days each year deviate from the average. Out in the eastern part of the state, commonly known as La Huasteca, verdant tropical forests attract significant rainfall, while the western plains are generally hotter and drier. However, extreme climate events are growing increasingly common, and 44 of the state’s 58 municipalities were declared to be subject to a natural disaster by the state’s Secretariat for Agriculture and Rural Development in early July 2019.

Environment 

San Luis Potosí is one of Mexico’s most biodiverse regions. It is divided into two broad hydrographic areas, the north-west with its seasonal watersheds and the south-east with an important network of tributaries in the Pánuco River basin. Around the state capital there are a number of hot springs and waterfalls. There is an array of flora, ranging from native palms to fruit-bearing trees, while a number of reptiles, mammals and amphibians are among its vibrant fauna.

Population

According to the most recent national census from the National Institute of Statistics and Geography, the population of San Luis Potosí stood at 2.7m in 2015, comprising 2% of the national total and up 400,000 people since the turn of the millennium. Some 10% of potosinos aged five and older speak an indigenous language – above the national average of around 6.5% – owing to a relatively large population of Náhuatl, Huasteco and Pame peoples. The state’s main urban centre is its capital and Mexico’s sixth-largest metropolitan area, which sprawls across 385 sq km of valley floor. Around 65% of inhabitants reside in urban areas, a figure slightly below the national average. There are a number of smaller towns across the state, but none come close in size to the capital.

Children receive an average of 8.8 years of education by the age of 15, positioning San Luis Potosí slightly below the national average of 9.2 years. However, a burgeoning higher education segment has seen an expansion at the Autonomous University of San Luis Potosí, a new campus built for the Polytechnic University of San Luis Potosí, and a satellite campus constructed for the Monterrey Institute of Technology and Higher Education.

Politics

San Luis Potosí is one of Mexico’s 31 federated states (Mexico City is a separate entity with similar autonomy to a state) and one of 13 governed by the PRI. The state sends three representatives to the country’s 128-seat senate and 10 to the 500-seat Cámara de Diputados (Chamber of Deputies), Mexico’s lower chamber. In September 2015 Governor Juan Manuel Carreras took office for a six-year term, having previously represented the state in the federal legislature in 2000-03. Gustavo Puente Orozco, the local secretary of economic development and the former president of San Luis Potosí’s National Chamber of Industry, has been instrumental in seeking out foreign direct investment for the state’s formidable automotive sector.

Housing

According to the latest census, in 2015 there were 710,000 homes in San Luis Potosí, of which 72% had running water, 97.4% had electricity and 71% were connected to the public sewerage system. A satellite city built to house workers in the manufacturing industry has expanded in size since its inception in 2015. The development has a special focus on providing affordable housing with green spaces (see Construction & Real Estate analysis).

Security

San Luis Potosí has largely avoided the security issues experienced in other parts of Mexico. In an interview with local media in March 2019, Alejandro Leal Tovías, the general secretary of San Luis Potosí, highlighted the significant reduction in organised crime. Meanwhile, the following June saw the arrival of 13 units carrying 800 guardia nacional (national guard) agents. The guardia nacional is a hybrid military-civilian police force that is a totem of President Andrés Manuel López Obrador’s security policy. The decision to station the troops in San Luis Potosí was made by the state legislature in March 2019, passing by 25 out of 26 votes.

Economic Breakdown

According to the Secretariat of Economic Development, San Luis Potosí’s GDP stood at MXN369.2bn ($19.1bn) in 2018 at constant prices, up 3% from MXN358.3bn ($18.5bn) the previous year, making it the eighth-fastest growing state in the country. To compare, average national GDP growth stood at 2% that same period. Quarterly figures from the government show that GDP growth is expected to reach 1.3% in 2019 – above the estimated national figure of 0.9% – suggesting that the state’s expansion will likely be maintained despite any issues with the broader economy.

San Luis Potosí’s export capacity is also on the rise, with the value of goods shipped from the state up from $9.5m in 2016 to an estimated $16.4m in 2019. Key growth drivers for the state economy include the automotive, manufacturing, agriculture and tourism sectors. At 3.1% the state also boasted Mexico’s 12th-lowest unemployment rate as of August 2019, compared to a national figure of 3.7%. San Luis Potosí also ranks among the top states in terms of formal employment.

Research & Development 

A fundamental part of the state development plan is the Programme for the Science and Technology Sectors 2016-21, which aims to promote science, technology and innovation in order to stimulate economic development and promote social well-being. The plan embraces a triple-helix approach, emphasising strong links between the public and private sectors and academia. To facilitate the programme’s goals, universities – including the Monterrey Institute of Technology and Higher Education, and the National Autonomous University of Mexico – have inaugurated facilities at some of the 86 campuses already located in San Luis Potosí. The University of New Mexico also has plans to open a campus in 2020.

Doing Business

The most recent subnational dataset from the World Bank in 2016 ranked San Luis Potosí eighth out of 32 locations in the country on the ease of doing business. The city’s attractiveness as an investment destination is expected to be further bolstered by the Alianza Centro-Bajío-Occidente, which brings together five of the fastest-growing states in Mexico – Aguascalientes, Jalisco, Guanajuato, San Luis Potosí and Querétaro – to boost much-needed government collaboration to encourage development (see Economy analysis).