A difficult start for the President of Mexico. Economic and social aspects

The impulse to modernize Mexico's economy since the enactment of the Energy Reform Act in 2012 has been significantly weakened by the radical fall in world oil prices that began in 2014. The new president, AMLO, who came to power in 2018, relying on the high support of voters, took measures to dismantle the reform and preserve state monopolies in the industry aimed at producing energy based on hydrocarbon raw materials and infringing on the interests of private investors. This led to an increase in distrust of entrepreneurs towards the economic course of the president. Already in 2019, the economy began to decline, accelerated in 2020 by a pandemic. Services, a number of manufacturing and oil industries were the most affected by the crisis. Imports of capital goods sharply decreased, export growth slowed down. The factors contributing to keeping the economy afloat are the new integration agreement with the United States and Canada (USMCA) and the country's relatively stable financial situation, which is facilitated by the IMF flexible credit line of $61 billion. The transfers sent from abroad by relatives provide significant support for Mexico’s population. But the president's policies require serious adjustments with a purpose to address the long-term problems of economic inefficiency, corruption and increased drug trafficking, and, above all, with a purpose to strengthen the competitive foundations of the economy through its liberalization and widespread use of the potential of private companies.

Keywords

economy, recession, export, USMCA, renewable energy, private sector, pandemic, organized crime

Received

12.09.2020

Publication date

08.02.2021

Number of characters

40486

Cite

GOST	Semenov V. A difficult start for the President of Mexico. Economic and social aspects // Latin America – 2021. – Issue 2 C. 29-46 [Electronic resource]. URL: https://latamerica-journal.ru/S0044748X0013153-7-1 (circulation date: 20.04.2024). DOI: 10.31857/S0044748X0013153-7
MLA	Semenov, Victor L "A difficult start for the President of Mexico. Economic and social aspects." Latin America 2 (2021):29-46. DOI: 10.31857/S0044748X0013153-7
APA	Semenov V. (2021). A difficult start for the President of Mexico. Economic and social aspects. Latin America (2), pp.29-46 DOI: 10.31857/S0044748X0013153-7

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