Introduction
As we approach mid-2025, Mexico remains standing despite initial concerns and fears at the start of the year. The return of Donald Trump to the U.S. presidency has not yet led to a T-MEC rupture, an economic collapse, or a massive deportation crisis at the northern border. Despite new tariff measures, Mexico continues to be the primary commercial partner of the United States.
Economic Resilience in a Complex Global Environment
The author acknowledges Mexico’s notable economic resilience amidst a complex global environment, including geopolitical tensions, supply chain disruptions, imported inflation, and global growth signals. Manufacturing exports have grown in the first quarter of the year, inflation seems controlled (pending confirmation), and significant investments are expected for the first quarter.
Fiscal Policy and T-MEC: Crucial Areas for Strategic Decisions
While these developments are positive, the author emphasizes that resilience is not progress. Mexico cannot merely endure current challenges; strategic decisions are needed to transform resilience into growth projections.
- Fiscal Policy: The 2025 budget presumes a 3.9 PIB percentage fiscal deficit, fueled by social commitments and infrastructure projects. This imbalance raises legitimate concerns among investors and analysts, as there’s limited room for maneuver despite the relatively stable peso and contained inflation.
- T-MEC Review: With the anticipated T-MEC review starting soon, Mexico must establish a clear strategic position. The focus should go beyond avoiding tariffs and delve into deepening the agreement on supply chains, digital trade, artificial intelligence, and countering “national security” measures that undermine the treaty’s logic.
Strategic Recommendations for Sustained Growth
To maintain its attractiveness compared to emerging economies like India and Vietnam, Mexico must demonstrate growth without losing fiscal discipline. Balancing the budget isn’t just a technicality; it’s essential for maintaining stability.
Mexico should also anticipate U.S. efforts to regulate its relationship with China through the T-MEC. A smart autonomy is needed to protect Mexico’s development space and industrial policy without jeopardizing regional integration.
Conclusion
Resilience has been a merit, but strategic advancement is now imperative. The first half of the year showcased resilience; the second half will demonstrate strategic prowess.
Author Background
The author, a research professor at the Universidad Panamericana, previously spent two decades working in the federal government on international trade negotiations.
