Background and Relevance
In the final quarter of 2024, Mexico’s national economy faced fragility, reflected in the performance of its 32 federal entities. The victory of Donald Trump in the United States injected uncertainty into business confidence.
Economic Decline Across Most States
According to deseasonalized figures from Mexico’s National Institute of Statistics and Geography (INEGI), 25 out of the 32 Mexican entities reported declines in their Indicator of Quarterly Activity of the State Economy (ITAEE) over the last three months of 2024.
Severest Declines
- Sinaloa experienced the deepest fall of -6.78% due to insecurity affecting its economy.
- Tabasco followed with -3.44%, impacted by decreased petroleum production and lower international crude oil prices.
- Michoacán saw a -2.72% decline, influenced by the aftermath of weather-related disasters.
Other Notable Declines
Additional declines were observed in Querétaro, Baja California, Tlaxcala, Morelos, Puebla, Coahuila, San Luis Potosí, Zacatecas, Durango, Oaxaca, and Hidalgo.
Factors Contributing to the Decline
- Completion of major projects by President Andrés Manuel López Obrador
- Weak manufacturing sector in the United States
- Uncertainty caused by Donald Trump’s actions
Outliers: Positive Growth in Select States
Despite the overall decline, seven state economies stood out with positive variations in their ITAEE during the reference period.
Top Performers
- Baja California Sur led the nation with a 1.37% trimestral growth, driven by the thriving tourism sector and investment attraction.
- Guerrero followed with 1.27% growth, benefiting from a post-disaster rebound.
- Colima completed the podium with 1.16% growth, anchored by the Manzanillo port’s activity.
Key Questions and Answers
- Q: What caused the economic decline in Mexico’s states?
A: The primary factors contributing to the decline were the completion of major projects by President Andrés Manuel López Obrador, a weak manufacturing sector in the United States, and uncertainty caused by Donald Trump’s actions.
- Q: Which states showed positive economic growth despite the overall decline?
A: Baja California Sur, Guerrero, and Colima demonstrated positive growth, with tourism, post-disaster recovery, and port activity playing crucial roles in their success.
