May 28, 2021 | 05:00
COVID-19 vaccination campaigns have opened up different economic sectors in the United States and Mexico, improving the GDP growth forecast for this year.
In the US, the economy showed growth of 6.4% in the first quarter of the year, while Mexico showed an advance of 0.4% in the same period and compared to the fourth quarter of 2020, according to Inge’s figures.
With this view, specialists are of the opinion that the growth of the Mexican economy is likely to be higher than the average of 5.3% estimated by the Ministry of Finance and Public Credit, but it will be difficult to achieve the levels of growth that were before COVID-19. .
The important thing is a full recovery as quickly as possible, but the production levels we had before the pandemic can be seen until 2023.
Alejandro Saldania, chief economist at Bx + said.
Although the US economy is a catalyst for Mexico’s GDP, the lack of a fiscal stimulus policy on the part of the Mexican government reduces its ability to exit faster than the 8.5% decline that occurred in 2020, said Saldana, who estimates an overall recovery. Mexico’s GDP is 5%.
The limited fiscal space for public finances and a commitment to debt intolerance in the midst of the crisis due to the novel coronavirus (COVID-19) has left the country few possibilities to provide support to companies and solve deficiencies in the health system.
Even with limited support, Mexico benefited from the fiscal stimulus packages implemented by the Donald Trump administration in 2020 for $ 2.2 trillion and from the support promoted by President Joe Biden for $ 1.9 trillion.
External demand will allow for a greater recovery in GDP
Janeth Keyrouz, deputy director of economic analysis at Monex, said the economic growth Mexico has achieved this year will be largely attributed to increased external demand for products that are manufactured in the country.
As the vaccination process accelerates, there will be greater certainty and we will see a more vigorous revitalization, as more jobs are created and consumption increases.
The specialist at Monex, who expects a 5.5% GDP advance, said.
One of the risks that the specialist warns is the shortage of semiconductors, which causes a halt in various industries related to the production of cars, as Mexico is very much involved.
Keyrouz explained that a catalyst could still be generated to improve the local economy. In his opinion, the recovery that the Mexican economy will achieve in 2021 will be due to the base of comparison for 2020 and the stimuli provided by the United States.
Our forecast of 5.5% tells us that we are constantly growing, but growth is still gradual
With GDP growth of 0.8% in the first quarter and compared to the previous quarter, the deputies of Banco de México (Banxico), Jonathan Heath and Gerardo Esquivel showed better forecasts for this year.
“With this new GDP data, in the blink of an eye, we can see a growth rate this year close to 7% (optimistic scenario),” Heath said on his Twitter account.