![]() Lopez Obrador’s decision to cancel a partly built, $13bn new airport for Mexico City and his retreat from the prior government’s liberalisation of the oil and gas industry stirred concern about his economic stewardship. However, the United States ratification of a new North American trade agreement this month and the roll-out of major infrastructure projects augured more positively for 2020, he added.Ĭapital Economics agreed but was still downbeat, forecasting that growth will be “much weaker than most expect” with the economy expanding just 0.5 percent this year. Gross fixed capital investment fell by 5.2 percent on the year during the first 10 months of 2019, according to figures published by INEGI this month.Įarlier this week, Carlos Salazar, head of the Business Coordinating Council (CCE, Mexico’s powerful business lobby), told a news conference that “uncertainty” had eaten into domestic investment last year. “It’s very important to have better distribution of income and that the benefits reach all.”įoreign investment has held firm in Mexico under his government, but domestic businesses have been more wary. “They don’t matter that much to me, because as I say, growth may mean that there’s more money in a few hands,” he told a regular government news conference. He also said wealth was now spread more equitably. Lopez Obrador, who has pledged to deliver annual growth of four percent, shrugged off the GDP data as a yardstick from a “neoliberal” era whose policies had benefited a select few. Mexico’s economy struggled during the first year in office of Lopez Obrador, a leftist who promised to root out corruption and chronic inequality when he took office in December 2018. A final estimate for the quarter will be published on February 25, 2020. That, at least, was slightly better than the consensus forecast in a Reuters poll for a contraction of 0.1 percent. Gross domestic product (GDP) was unchanged during the fourth quarter compared to the previous three months, INEGI said. “The carryover from the weak performance in 2019 will weigh on conditions this year.” “Today’s figures essentially confirmed that Mexico was one of the world’s worst-performing large emerging markets in 2019,” said Capital Economics in a note. Forecasts for 2020 are also weak.Īdjusted for seasonal swings, Latin America’s second-largest economy contracted by 0.1 percent in 2019 after growth of just over two percent the previous year, according to a preliminary estimate published by the national statistics office Instituto Nacional de Estadistica y Geografia (INEGI). Mexico‘s economy contracted last year for the first time in a decade, data showed on Thursday, as businesses curbed investment due to concerns over the economic management of President Andres Manuel Lopez Obrador.
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