“To talk about a recession, not only do you have to look at the drop in GDP, but also the behavior of other economic variables, such as employment, for example, and which is the most important after GDP,” explained the Undersecretary of Finance, Gabriel Yorio, last Friday.
“Many of the people who became unemployed are going back to work and are willing to go back to work.”
What is a recession?
In a broad definition, an economic recession is when the economy, measured by GDP, accumulates two consecutive quarters in decline.
#MEXICO – Economy fell into technical recession in the fourth quarter of 2021 by reporting two consecutive quarters of GDP contraction.
– Alfredo Coutino (@AlfredoCoutino)
January 31, 2022
The poor results of the GDP during 2021 are confirmed. It decreased 0.1% during the 4th quarter (compared to the third). This places the Mexican economy in recession. ??
In annual terms it grew 5% after having fallen 8.4% in 2020.
So a bounce.— Valeria Moy (@ValeriaMoy)
January 31, 2022
Other Viewpoints for a Recession
However, some economists, such as the deputy governor of Banxico, Jonathan Heath, consider that there must be other factors to determine whether the Mexican economy is in recession or not.
The three criteria to study to determine the existence of a recession are duration, depth and diffusion. open thread…
— Jonathan Heath (@JonathanHeath54)
January 31, 2022
How can we get out of the recession?
But regardless of whether the country is in recession or not, economists agree that the Mexican economy is not growing and needs stimulus to come out of its lethargy.
There is a lot of discussion about whether or not we are in a recession.
Beyond definitions, it is clear that Mexico’s economy is not doing well. pic.twitter.com/Z7LGPfjBfw
– Gabriela Siller Pagaza (@GabySillerP)
January 31, 2022
The slow recovery is due to:
1) Mexico had been in decline since the end of 2018
2) There were no fiscal stimuli
3) Disruptions in supply chains
4) Caution for covid
5) Governance: insecurity and uncertainty by pol. economical
6) Reforms that have slowed growth– Gabriela Siller Pagaza (@GabySillerP)
January 31, 2022
