With a population of nearly 130 million people, a rich cultural history, great diversity, and a favorable geography with abundant natural resources, Mexico ranks among the fifteen largest economies in the world and is the second largest in Latin America. The country has strong macroeconomic institutions, an open trade policy, and a diversified manufacturing base integrated into global value chains.
Over the past three decades, Mexico has underperformed in terms of growth, inclusion, and poverty reduction compared to similar countries. Between 1980 and 2022, the economy grew by just over 2% annually on average, limiting progress in closing the gap with high-income economies. In 2023, the economy grew by 3.2%, while in the first half of 2024, growth slowed to 1.8%, reflecting a moderation after the post-pandemic rebound. Despite this, the official multidimensional poverty rate fell from 43.9% in 2020 to 36.3% in 2022, lifting 8.8 million people out of poverty, though challenges remain in access to health and education services.
Mexico's stable macroeconomic framework, the economic dynamism of the United States, and its strong manufacturing base are key factors supporting growth. To accelerate sustainable growth and reduce poverty in the medium term, it is crucial to address structural limitations such as restricted access to finance, insecurity, informality, regulatory burdens, and infrastructure bottlenecks. Additionally, it is necessary to confront challenges related to fiscal space. Overcoming these obstacles is essential to fully capitalize on the opportunities nearshoring presents in the current international context.
Last Updated: Oct 09, 2024
