Mexican Economy Faces Increasing Investment Challenges

The Mexican economy contracted in 2024, with foreign investment dwindling and concerns over decreasing reinvestment of profits. A favorable turn seems unlikely without significant reforms.


Mexican Economy Faces Increasing Investment Challenges

The Mexican economy closed 2024 with a contraction, resulting in a growth of only 1.5%, or 1.2% considering calendar effects. Foreign investment in the country has decreased, despite official announcements of its supposed historic increase. According to estimates, between 1970 and 1978, less new investment came to Mexico than currently.

During 2024, new foreign direct investment in Mexico was 3 billion 169 million dollars. Although foreign investment is lower than national investment, it has been crucial in recent decades, especially in a country focused on foreign trade. Profit reinvestment has decreased, despite showing steady growth in previous years.

The decline in foreign investment began in August 2024 after a brief growth in previous months, possibly related to government support programs. Reinvestment of profits, on the other hand, has been increasing steadily. However, in absolute terms, it is the lowest this century, showing a worrying trend.

The Mexican economy has been affected by internal decisions that seem to prioritize maintaining power over the economic well-being of the country, which has weakened its productive capacity and attractiveness for foreign investment. The cancellation of significant projects, such as the airport, has contributed to this situation. In the future, if significant changes do not occur, discussions may begin about an economic depression rather than a recession.