ECLAC cuts Mexico’s growth projection to 1.9%; anticipates a weaker 2025

BOGOTÁ (apro).- The Economic Commission for Latin America and the Caribbean (ECLAC) today reduced its growth projection for this year for Mexico to 1.9% and noted that in 2025, the first year of President Claudia Sheinbaum’s government, the Gross Domestic Product (GDP) will only increase by 1.4%, the lowest figure since 2020.

In its projections last May, ECLAC had estimated that Mexico’s GDP would grow by 2.5% this year, so the downward adjustment since then is -0.6 points.

Presenting the Economic Study 2024 in Santiago, Chile, ECLAC’s executive secretary, José Manuel Salazar-Xirinachs, noted that the drop in growth estimates for Mexico is mainly due to the economic slowdown in the United States, especially in its manufacturing sector, and the slowdown in consumption and investment in the country.

He said that according to figures from Mexico’s Ministry of Finance and Public Credit (SHCP), the fiscal deficit of the non-financial public sector this year would reach 5.0% of GDP, the highest since 1990, attributable above all to the financing of the emblematic public works of the government of Andrés Manuel López Obrador, which he plans to complete this year.

According to the United Nations agency, there are factors that can modify the estimate of Mexican GDP growth downwards or upwards, such as those associated with the pace of global economic activity, the attraction of national and foreign investment, and the international availability of inputs for production.

In a note on Mexico attached to the study, ECLAC indicated that presidential elections were held in June 2024, in which the Morena candidate, Claudia Sheinbaum, was the winner with the largest number of votes in her favor in history.

The organization estimated that in 2025 Mexico’s GDP will increase by 1.4%, mainly due to the economic slowdown in the United States and the uncertainty of the international environment.

Growth would be the lowest since 2020, when the Mexican economy collapsed -8.4% due to the effects of the Covid-19 pandemic.