Mexico hopes for an economic recovery

The private sector will be key to start the economic recovery

Mexico hopes for an economic recovery
The COVID-19 pandemic sparked an economic crisis and a surge in unemployment - Photo: Carlos Zepeda/EL UNIVERSAL
English 26/08/2020 08:58 Mexico City Editorial Actualizada 09:05
Guardando favorito...

Leer en español

Although the government has made decisions that could discourage investment, especially foreign investment, a report issued by Banxico is giving some hope regarding the economic recovery. According to a report released by Banxico, Mexicans who maintained at least USD 795 million abroad will soon transfer the money back to Mexico. 

According to this report, this is the first significant return of resources since Andrés Manuel López Obrador won the presidential election in 2018. Back then, the move by Mexicans who had invested outside of the country or kept their money abroad was seen as a positive sign. 

The fact that resources are returning to the country is good news, but now Mexico will face a new challenge: facilitate the investment of those resources in productive projects and to maintain certainty for the local and foreign investors so that they allocate the money to create new jobs. It is necessary to eradicate ambiguous discourses because authorities say they are allies of investors, but the next day the government stigmatizes them. 

Recommended: Mexico's economy to plummet 10.5% over global COVID-19 effects, warns IMF

The Mexican government has talked about a new model to push for the economic recovery of the country, but it only relies on refusing to bailout bankers or big businesses. Instead, it focuses on helping people and popular economy, although it is not clear how is this possible if the government itself has fired thousands of federal employees who will likely struggle to find a job amid the pandemic. 

The private sector will be key to start the economic recovery. If resources are returning to Mexico, perhaps because the COVID-19 pandemic has canceled some opportunities or affected several markets, the least the Mexican government can do is incentivize and stimulate investors to stay in the country, to invest in market niches, and to create new jobs. 

This is why investors expect more than speeches from authorities, where they reiterate that the government will only help the poor. Investors expect the Mexican government to guarantee that they will have a way to make a living, which requires the government to cooperate with the private sector. A relationship between them will benefit everyone and lead to economic recovery. 

gm

Guardando favorito...
 

Noticias según tus intereses