BBVA on Mexico’s Growth: A Closer Look Beyond the Surface
Mexico's recent economic performance may appear promising when compared to some of its struggling neighbors, but according to Jaime Serra, Chairman of the Board of BBVA Mexico, this is a misleading perspective.
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The Latin American Post Staff
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Leer en español: BBVA sobre el crecimiento de México: una mirada más allá de la superficie
While Mexico has managed to maintain positive momentum, Serra contends that the country could have achieved even greater growth with timely decisions and strategic actions. In a candid conversation with the media, he emphasized that understanding Mexico's economic standing requires a more nuanced analysis.
Mexico's Relative Success Amid Regional Challenges
Serra pointed out that Mexico's relative success is partly due to the challenges faced by other nations in the region. Comparatively, when measured against countries grappling with severe economic hardships, Mexico's performance stands out positively. However, if assessed against its own potential to harness factors like attracting investments and making forward-thinking decisions, the outlook appears less encouraging.
In his assessment, Serra projected that Mexico's growth will continue along its current trajectory into the next year. Still, he also acknowledged the potential for significant shifts in the country's economic landscape due to the upcoming elections in June 2024 in Mexico and the November elections in the United States.
Missed Opportunities and Insights from Carlos Serrano
Carlos Serrano, Chief Economist at BBVA Mexico, delved deeper into the missed opportunities for Mexico's growth. He revealed that Mexico could have achieved up to 1.8% higher growth had it capitalized on investment opportunities and made proactive decisions in the face of various volatility factors over the past few years, including the COVID-19 pandemic, the Ukraine-Russia conflict, and high-interest rates and inflation.
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Serrano emphasized that while Mexico has averaged a 2% growth rate over the past four decades, this percentage could potentially double if the country creates the necessary conditions to attract foreign direct investment, particularly from China.
Seizing Opportunities for Economic Expansion
Over the last 40 years, Mexico has experienced relatively modest economic growth, but Serrano stressed that this figure could significantly increase if Mexico seizes opportunities like the relocation of supply chains, also known as 'nearshoring.' To make this possible, Mexico would need to develop renewable energy sources and ensure access to ample natural resources, such as water. Inflation trends in Mexico
