Mexico City. Bank of Mexico Governor Alejandro Díaz de Leon said Monday that Mexico faces a “new challenge” as different sectors of its economy recover at varying rates, with export-dependent regions leading the way.
GDP contracted by 8.5% in 2020, its biggest drop in nearly 90 years, due to the ravages of the coronavirus pandemic. However, it recovered faster than expected in the fourth quarter of 2020.
“The new challenge is economic activity, and the recovery will be heterogeneous, driven by two engines: the vaccination engine (…) and the spending engine that supports different economies,” said Diaz from Lyon.
The massive pandemic rescue package of $ 1.9 trillion in the United States, Mexico’s main trading partner, will help support the recovery of the Mexican economy.
The Governor of Mexico City stated that the most important components of the last year for the recovery of economic activity in Mexico were external demand and the export sector, which is much higher than consumption and investment.
He added, “We expect to move forward with this important spending and stimulus program in the United States, which will help it to continue playing an important role in foreign demand.”