World Bank: Killjoy

Discretionary investment cancellation has been particularly damaging in undermining entrepreneurs’ propensity to invest…

In the morning conference on Monday of this week, President López Obrador stated that on the economic front “in our country we are doing quite well.” However, the economists of the highly prestigious World Bank do not seem to agree with that opinion. In this sense, in the recently published document “Global Economic Perspectives” the international organization explains that the government of the 4T will be the one with the lowest economic growth in the last 36 years and also the performance of the Mexican economy will be the lowest during the last 36 years. last four years in the context of Latin America. And for the year 2023, the agency predicts a real growth of the Mexican economy (that is, deflated by inflation) of only 0.9 percent.

Implicitly, there is in these conclusions a refutation of the initial promise of the current government that in its six-year term the economy would grow, on average in real terms, at 4% per year. The World Bank has presented these figures and expectations, but the document fell short in providing explanations for such meager results. One reason is the poor performance of public investment by the government itself. Another, the deterioration of private investment, which makes up more than 80% of total investment.

Regarding the contraction of public investment, there is the very revealing data that in real terms the level of this item has been much lower in the four years of the current six-year term than during the administrations of Felipe Calderón and Peña Nieto. And that, including the construction of the current government’s favorite white elephants. And since the government of the 4T began, the attack on the confidence of economic agents has been a reiterated constant of action.

The discretionary cancellation of investments has been particularly damaging to deteriorate the propensity to invest on the part of businessmen, both Mexican and foreign. In the extreme, the government project to strengthen the monopoly position of Pemex and the CFE in their respective sectors could even call into question the subsistence of the trade opening treaty in North America, T-MEC. Stagnation and a deterioration in the welfare level of the majority classes is the economic balance of the current administration. And realistically, the time is up to try to right the course.

bdonatello@eleconomista.com.mx