President Andrés Manuel López Obrador’s tenure has seen public investment in Mexico reach its lowest level since the 1990s.The ratio of public investment to GDP averaged 2.7% during his administration, a figure not seen since Ernesto Zedillo’s presidency.This data comes from the National Institute of Geography and Statistics’ latest Quarterly Global Supply and Demand report.The report reveals that total gross capital formation, including both public and private investment, equaled 22.3% of GDP during AMLO’s term.Interestingly, private investment reached 19.6% of GDP, the highest level in the last five presidential terms.
This contrasts sharply with the decline in public spending.Public Investment in Mexico Hits Record Low Under AMLO’s Administration.
(Photo Internet reproduction)Mexican officials and business leaders agree that sustained investment of at least 25% of GDP is necessary for annual growth rates above 3%.The government should contribute at least 5 percentage points to this total.
In 2019, the federal government and the Business Coordinating Council set a joint goal to increase physical investment to 25% of GDP.However, as AMLO’s term ends, it’s clear that while the private sector nearly met expectations, the government fell short.A Comparative AnalysisPublic investment under AMLO has been lower than in the previous three administrations.
This decrease occurred despite major infrastructure projects like the Maya Train and the Olmeca Refinery.Carlos Ramírez, an economist at Integralia, notes that beyond these large projects in the center-south, there was little public works stimulus in the western and northern regions.
He criticizes the concentration of public spending in specific areas.According to the Ministry of Finance, federal government physical investment totaled 4.91 trillion pesos from the start of AMLO’s term until August 2024.
This amount is 19.9% lower in real terms compared to Enrique Peña Nieto’s administration.Significant decreases were observed in energy (23.5%), communications and transport (46.6%), education (87.7%), and water (25.9%).
Only health and other construction sectors saw increases of 31.4% and 17%, respectively.Ramírez concludes that less was invested in highways, oil exploration and production, and hydraulic works during AMLO’s presidency.
This trend raises questions about the long-term impact on Mexico’s infrastructure and economic growth.
Music
Trailers
DailyVideos
India
Pakistan
Afghanistan
Bangladesh
Srilanka
Nepal
Thailand
StockMarket
Business
Technology
Startup
Trending Videos
Coupons
Football
Search
Download App in Playstore
Download App
Best Collections