One. We are in the basement of growth in Latin America. In 2025, Guatemala’s economy will grow 4.0% and that of the United States, 1.6 percent. These references matter because they are our neighbors. For Mexico, growth of 0.5% is expected, one of the lowest in Latin America. The continent will grow almost five times more than us, 2.4 percent. On the right, Argentina stands out, which will have GDP growth of 5 percent. On the left, Chile and Colombia will grow 2.4 and 2.5%, respectively. Canada has had a bad year; Even so, it will grow 1.2 percent.
Two. Informality grows much more than formality. When we say that the Mexican economy grows very little, we must consider that the informal economy has other data and a dynamic much higher than the formal one. In the second quarter it had a growth of 1.9%, according to the INEGI. This is three times more than that recorded by the formal economy. Informality is the escape route for many microenterprises and the space that offers the greatest number of job offers. In the third quarter of the year, the informal sector generated 400,000 jobs, while the formal sector eliminated 308,000 positions in the same period.
Three. Trump is not the factor that explains the low growth. Mexico is the most vulnerable country before Donald Trump returns to the White House, stated The Economist Intelligence Unit in 2024. In many ways this is the case, for example, in terms of security and migration, but foreign trade tells a different story. Mexican exports to the United States have grown 6.6% between January and October compared to the same period last year. In the same period, China and Canada have reduced their sales to the United States. In total, we are selling almost $60 billion a month to our main trading partner. The Mexican export sector has been able to cope with the tariffs and also with the appreciation of around 10% of the Mexican currency. It is not oil or automotive exports that explain the good export performance. Mexico has consolidated its role as the United States’ main trading partner, both as a seller and as a buyer of US goods and services.
Four. Investment is the engine off. The Mexican economy needs to have investments equivalent to 25% of GDP to aspire to sustained and sustainable growth rates of 4% annually or more. We have not achieved it and, rather, we are in the range of 18 to 20 percent. For reference, China has had levels above 30% for four decades. In that context, we must put the data on the fall in investment. Between January and September, public investment plummeted by 20%, while private investment registered a drop of 5.2 percent.
The collapse of public investment is explained by the government’s effort to reduce the fiscal deficit inherited from López Obrador. AMLO’s last year left an imbalance close to 6% of GDP, almost two trillion pesos. Sheinbaum’s first year began with a commitment to reduce that deficit. The adjustment variable was public investment, because social programs have constitutional status and payment of government debt service is mandatory.
Five. The fall in private investment has to do with uncertainty. This has two poles: in the White House there are rule changes that force a pause in investments in sectors such as the automotive industry. In Mexico, uncertainty is polymorphic: the reform of the judiciary, public insecurity and the change of rules in key sectors, such as mining. We do not have stridency in the public statements of businessmen or depreciation of the exchange rate, but we do have 13 accumulated months of decline in investments and news that Mexican businessmen are investing heavily in other countries, for example, Spain.
