Mainly driven by the growth of the United States, the recovery of the Mexican economy and the International Monetary Fund (IMF) team, It is estimated that GDP will grow by 6.2% in 2021 and four percent in 2022, an improvement from five percent and three percent expected, respectively, in April.
However, the agency identifies continuing problems in productivity and poverty, as well as the need to speed up vaccination and support the exit from the COVID-19 crisis.
The priorities are to protect recovery, maintain economic stability, and promote inclusive and sustainable growth. First, it will require the eligible population to be vaccinated as quickly as possible. Given the economic stagnation, a positive fiscal stance in the short term will help mitigate the scars and ensure recovery,” recommended the technical team of the agency responsible for analyzing the country’s economy under Article IV.
The Mexican economy is recovering from its deepest downturn in decades, spurred by growth in the United States and advances in vaccination, which the International Monetary Fund expects to grow by 6.2% in 2021 and four percent in 2022.
The IMF team acknowledged that the Mexican authorities have maintained external, financial and financial stability, but they also point to situations such as the huge human, social and economic cost.
“There have been more than half a million deaths likely related to COVID-19. Underemployment is still higher than its peak during the global financial crisis; more than 4.5 million more people than before the pandemic are unemployed or underemployed. or available to work.Already high levels of poverty have increased.The report warns that young people face significant learning losses with potentially harmful long-term effects.
The report suggests that this fiscal space that the government has been able to preserve should be used to provide financial support for social assistance, education, health and public investment expenditures. Good design eases the burden on the most vulnerable in society and promotes more inclusive growth. This high initial spending should be accompanied by fiscal reform that is implemented gradually over the medium term as the economy strengthens,” he recommends.
For the international organization, it is positive that manufacturing and exports are already above pre-pandemic levels, services are opening up, and employment is recovering; However, the real income per person It has continued its long divergence from the US and expectations are that it will continue to widen in the future.
Low productivity growth and high poverty remain the main problems for Mexico. Looking to the future, the economy will face new challenges resulting from technological changes and the effects of climate change,” he points out.
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