Mexico, a home to one of the world’s largest emerging market economies, had faced off its steepest annual contraction in nearly 90 years in 2020, however, the world’s 11th-largest economy by PPP (Purchasing Power Parity) and the 16th-largest by nominal GDP, had reported a better-than-anticipated recovery from pandemic induced slump over the fourth quarter of 2020, preliminary Government data had revealed on Friday.
In point of fact, according to an estimate issued by the country’s national statistics agency INEGI, Mexican economy had contracted by 8.5 per cent last year on a seasonally adjusted basis, beating an analysts’ estimate of a contraction of as much as 10.8 per cent.
Nonetheless, still the second-largest LATAM economy had witnessed its sharpest downturn in GDP (Gross Domestic Product) since the Great Financial Depression of 1932, data from National Autonomous University of Mexico had revealed, while the Mexican economy is expected to grow more than 3 per cent this year.
However, a fresh resurgence of the global-scale pandemic outbreak might bottleneck the economy’s growth this year as well, suggested analysts.
Mexican economy sees worst annual contraction in 90 years in 2020
In factuality, the Mexican economy had faltered terribly over the first half of 2020, but pared much of the ground losses in the pandemic in the second quarter, however, an unexpected wave of pandemic resurgence late in 2020 led to a number of commercial restrictions, eventually disrupting the economy’s growth momentum.
Apart from that, despite a better-than-anticipated fourth-quarter GDP growth that helped the second-largest Latam economy keep its annual contraction rate at a single-digit percentage point, the economy’s growth remained a key challenge for the far-right Mexican President Manuel Lopez Obrador, since his efforts to flesh up the Government’s role in energy market led to a number of disputes last year while upsetting the country’s long-term North American allies likes of Canada and the United States.
Followed by the announcement, Mexican Deputy Finance Minister Gabriel Yorio had raised the country’s growth forecast for 2021 to 4.6 per cent adding that an achievement of the target would largely depend on the rollout of pandemic vaccines alongside their efficacies to boost up businesses’ sentiments.