Despite everything, the economy grows

The preliminary result of the Gross Domestic Product (GDP) of Mexico during the third quarter of this 2022 can be summarized with the word resilience.

Now, the Inegi report of a GDP expansion of 1% compared to quarterly and 4.3% compared to the third quarter of 2021 is not a spectacular result.

The Mexican economy has not recovered everything lost during the pandemic and its consequent confinement. Plus, this country entered the unforgettable 2020 with a recession the year before, so we’re still on the rebound.

We must remember that 2021 was still a difficult year for the economy, and for everything else, because we continued to face the waves of Covid-19 that again slowed down economic performance and morale when we thought the worst was over. Therefore, that 4.3% is a mere rebound from those very low parts of the crisis.

But, in general, the result known in this first reading of the GDP seems to anticipate the possibility of growing more than 2% and if the dynamism is maintained at the end of the year, up to 2.5 percent.

That is something that should make us all happy, because it is not possible for anyone in their right mind to want a bad economic performance for Mexico, but neither can credit be granted to those who do not deserve it.

No, there is nothing to thank public policies for explaining this behavior of GDP. On the contrary, the Mexican economy moves despite the obstacles that the 4Q imposes on confidence and investment every day.

None of the spending projects of this administration, neither for the creation of infrastructure, nor for social spending, pay back in a boost to private investment, which is what really moves an economy like Mexico’s.

The diversion of public resources towards non-productive projects, such as the Zumpango airport, the swamp refinery or the jungle train, does not chain private investment and does divert resources for works that could be productive.

It is the most regressive and neoliberal measures of this administration that could coincidentally contribute to a more robust rebound in GDP. Subsidizing gasoline consumption in the colossal way they have done and opening the borders wide to certain imports are incentives for growth.

They are not measures to be presumed as very leftist, so fashionable in Latin America, but they have served to keep inflation low and the economy moving.

Mexican resilience also includes the external, especially when the mood of the markets and of not a few economic agents point to an imminent recession in the United States.

It may be that with the data that we learned about the US and Mexican economies, the long-announced recession could be freed or it may be so light that it does not throw off the recovery of consumption in both countries.

But, for now, the Mexican economy is moving and we are happy to see the resistance of a country that for so many years has been able to build an institutional armor that resists all kinds of attacks and attempts, both internal and external.

ecampos@eleconomista.mx