Facts, forecasts and expectations: contrasts

In Mexico, there is a notable contrast between facts, forecasts, and expectations.

The facts highlight a notable economic weakness observed during the previous six-year term.

Forecasts indicate sluggish economic growth for the country this year and next.

They anticipate the prolongation of the economic slowdown.

And expectations are showing rising optimism, with investment announcements.

Among the facts, economic stagnation stands out.

The growth rate will be less than 1% for 2025 and 2026.

This will be added to the six years of the López Obrador administration, during which growth was less than 1% annually throughout the entire six-year term.

The forecasts are not positive regarding economic growth, job creation, investment, and consumption.

The gray and black clouds that portend a severe storm are caused not only by the conditions of the national economy and the limited fiscal space available to the government of Mexican President Claudia Sheinbaum.

In addition to the uncertainty generated by the Judicial Reform.

The threats and tariff decisions of United States President Donald Trump also weigh heavily on the world and Mexico.

Trump's protectionist policies led the OECD to revise the global economic growth rate downward.

And it reduced it to 0.4% for Mexico, placing the economy as the one with the lowest growth among Latin American nations.

The risks for Mexico from the U.S. government's policies are mounting. In addition to tariffs, there is also the tax on remittances and migrant raids.

They are facts and forecasts that describe the circumstance, the moment.

However, announcements are being made that reveal very positive expectations for Mexico.

This isn't the $277 billion the Mexican government announced as part of Plan Mexico, a portfolio of foreign and local investments across 2,000 projects that are about to be implemented.

Since the last six-year term, the government has begun recording the investments it detects through various sources. Hopefully, this will be fulfilled.

Announcements made during morning press conferences or at the National Palace have also been recorded. Some of them were recycled, but ultimately valid.

In the October 2024 CEO Dialogue, investments of more than $20 billion were confirmed by 2025, led by Mexico Pacific, Royal Caribbean, Amazon, and Woodside Energy.

Marcelo Ebrard, Secretary of the Economy, noted that this amount could exceed $30 billion by 2025, depending on the development of other projects.

By March 31, 2025, the private sector had made 39 public investment announcements with an expected investment of more than $25 billion, although not all of the companies involved were named.

On the other hand, we see investment announcements being made by the private sector, outside the official spotlight.

BBVA México, headed by Eduardo Osuna, recently announced an investment of 100 billion pesos over the next five years.

Yesterday, the Coppel Group announced an investment of 80 billion pesos for the next five years.

They are two groups, financial and business, that are preparing for a long-term horizon.

They are looking beyond what is happening today in Mexico and the United States.

They will invest in modernization, technological transformation, and digitalization, in addition to physical infrastructure.

The bank and the company operate in Mexico and are very strong.

Their announcements contrast with the low level of new investment in Foreign Direct Investment that was recently announced.

Most analysts agree that the nearshoring train passed without stopping in Mexico.

On the other hand, some believe that with the changes taking place due to the new paradigm the US is imposing on the world, Mexico will stand out due to its comparative advantages over other countries.

In recent hours, Michelin announced its decision to close its plant in Querétaro. The official argument is that it has become obsolete and market needs have changed. Ultimately, the important thing is that it's one less asset.

Facts, forecasts, and expectations mark contrasts and uncertainty. Time and again.

Glimpses

Mexican President Claudia Sheinbaum confirmed her attendance at the G-7 meeting, where she will likely meet with the US president. It's a good decision. The president should take advantage of the international stage and seek direct dialogue with US President Donald Trump.