Introduction
In a recent article, I discussed the INEGI report on the Global Indicator of Economic Activity (IGAE) for October, which was released on December 22. I noted that the data was surprising and indicated a significant momentum in Mexico’s economy just for October, unseen in over a year. On the same day, supporters of President Sheinbaum celebrated October’s IGAE data as if it represented the entire 2025 economic activity.
Delayed Economic Insights
We’ll have to wait until February 2026 for INEGI to reveal Mexico’s economic performance during the last quarter of 2025. However, all signs point to a growth rate for the entire year not exceeding 0.5%, far from the Secretaría de Hacienda y Crédito Público’s (SHCP) initial estimate of 2.0% to 3.0% for this year’s budget and later adjusted to 0.5% to 1.5% for 2025 when preparing the Economic Package for 2026. In the best-case scenario, this year’s GDP growth will be at the lower end of the SHCP’s adjusted range.
President Sheinbaum’s Explanation
In November, when the third-quarter GDP behavior was announced, President Sheinbaum attempted to explain Mexico’s poor economic performance. On November 21, during her daily press conference, she attributed the slowdown to external factors: “It has to do with the drop in demand in the United States.”
US GDP Growth Contradicts Sheinbaum’s Explanation
Last week, the behavior of the US GDP during the third quarter was announced, revealing a 2.3% annual growth rate, largely driven by robust consumer spending in the country. As I mentioned in my November 25 article, someone should clearly explain to President Sheinbaum that Mexico’s anemic economic performance is not due to external factors but rather the decline in investment and stagnant domestic consumption, coupled with constrained public spending—essentially, stagnant public sector consumption.
Seven Years of Diverged Economic Growth
These data points will mark seven years of divergence between Mexico’s economic growth rate and that of the United States, starting at the end of 2018 with the beginning of the 4T regime. Worryingly, not only is there a disconnect, but the gap between accumulated GDP growth in the US compared to Mexico is widening. This should be a central concern for President Sheinbaum’s government, as it signifies that Mexico has failed to capitalize on the US economy’s expansion rate over these seven years. This is the legacy of the 4T.
Key Questions and Answers
- What is the current state of the Mexican economy? The Mexican economy has shown poor performance, with an estimated growth rate of no more than 0.5% for the year, far below initial SHCP estimates.
- Why is there a growing gap between the US and Mexican GDP growth? The divergence is due to factors like declining investment and stagnant domestic consumption in Mexico, contrasting with robust consumer spending and growth in the US.
- What does this mean for President Sheinbaum’s administration? The widening gap suggests that the 4T regime has failed to leverage the US economy’s expansion for Mexico’s benefit, raising concerns about their economic policies.
