Economic growth was the great slope left behind by the administration of President Ernesto Zedillo Ponce de León when in December 2000 it handed over power to PAN member Vicente Fox Quezada.
The promise to grow at annual rates of 5 percent in that six-year term was just that, a promise. The subsequent six-year terms of Felipe Calderón Hinojosa and Enrique Peña Nieto also failed.
This six-year term once again promised to grow at annual rates higher than the national average of the last four decades, that is, above 2 percent. It was even promised to grow at rates of 5 percent and up to 7 percent at the end of the administration.
The truth is that, as for decades, sufficient economic growth will be the great unfinished business left by the current administration.
Banxico revises GDP upwards, but it will be insufficient
On August 30, the Bank of Mexico (Banxico) revised upwards its economic growth forecast for this year and next.
The upward revision in the economic growth forecasts for Mexico brought the forecast of Mexico’s GDP to levels of 3 percent for 2023 and 2.1 percent for 2024, from previous levels of 2.3 percent for this year and 1.6 percent for the next year.
This is undoubtedly good news, but this upward revision does not greatly modify the final growth expectation for this six-year term. In general terms, the GDP of our country will not be able to deliver results that are significantly different and superior to those of other times.
The pandemic did affect, but the GDP was already falling
The main justification in the present administration is that the pandemic was the cause of the great objective of boosting economic growth not being achieved.
Yes, the pandemic undoubtedly affected economic performance, but it did not only happen in Mexico but throughout the planet. The year 2020 has gone down in history as the year of the great collapse due to the Great Confinement; Although, Mexico was one of the most affected and, in fact, it has not currently recovered its pre-pandemic levels, something that is not something to brag about, since practically all the stellar economies in the world have already recovered their levels prior to the great collapse. economic.
The truth is that the trajectory of economic growth in our country was already in decline; In 2019, the first complete annual period of the present administration, a decrease of 0.1 percent was registered, mainly due to decisions such as the cancellation of the New Mexico International Airport (NAIM) in Texcoco, with no other support than accusations without check for corruption, something that stopped the expectation of growth.
In general, the trajectory of the Mexican economy begins a political cycle weakly, but this time the decision on the NAIM was added to the change in the federal public administration, among others.
The arrival of the pandemic put the Mexican economy in a bad positionwas in virtual recession when the phenomenon hit and that caused it to be one of the most affected in the world.
GDP, the worst performance since Miguel de la Madrid
Measured by where it is seen, and even incorporating the upward revision of the economic growth rate by Banxico published this Wednesday, the economic growth of the six-year term will be the worst seen since the era of President Miguel de la Madrid Hurtado (MMH), in the eighties of the last century. Unless in the coming months there is a true economic miracle that raises GDP to levels not expected until today.
Let’s look at three items of GDP growth, to dimension what we are talking about: in terms of Total GDP Growth, this six-year period would be around 1.30 percent, this level of total or accumulated growth in the six-year period is the lowest since the administration of Miguel de la Madrid Hurtado, between 1982 and 1988, our country’s GDP grew by barely 3.5 percent. The lowest benchmark for growth outside of the current six-year term and that of MMH goes back to that of President Felipe Calderón Hinojosa, when it grew “barely” 11.1 percent in a cumulative manner.
If we measure average annual growth, this administration is once again in a bad light; already incorporating the upward revision of GDP carried out this Wednesday by Banxico, the annual average of Mexico’s GDP in the six-year term would be 0.25 percent, the lowest level since the MMH administration when the average was 0.58 percent. Once again, Felipe Calderón’s six-year term is located above these periods, but as the lowest, registering an average growth of 1.77 percent, which is undoubtedly better than the previous two.
Finally, if we measure the per capita growth of this six-year term with respect to other periods, without a doubt, bad accounts will be delivered; in fact, a negative rate of approximately 4.50 percent will have been recorded. This means that in per capita terms, Mexicans have less income compared to other periods. Once again, the six-year term of MMH is the other reference, since a decline of 7.91 percent was also registered.
Thus, growth will once again be the great slope for a six-year term. This one that is approaching its final stretch; the promise of an average GDP of 5 percent was once again just that: a promise.
whatMexico has the potential to grow beyond its potential of 2 percent per year?, It will be a question that we will try to answer in subsequent installments, but everything indicates that great generational changes are required for this to happen. Our country has not registered annual growth rates above 5 percent for almost 30 years, and that was due to the “rebound” after the collapse registered by the “tequilazo”, not to mention double-digit growth, it is something that we have seen in practically 50 years.
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