The Mexican president, Andrés Manuel López Obrador, attacked the International Monetary Fund (IMF), a multilateral based in Washington, for the estimates that predict greater economic growth for Argentina than for Mexico. On Tuesday, in the morning conference, the president also criticized the multilateral’s recommendations and accused it of being the “cause of Argentina’s economic disaster.”
“The International Monetary Fund declared that Argentina will grow more than Mexico, when the Fund, with all due respect, was the cause of Argentina’s economic disaster, and now as if nothing had happened, they position themselves as arbitrators, judges who decide on what is going to happen. happen in the future,” said López Obrador. The IMF estimates that Argentina will have a growth in its Gross Domestic Product (GDP) of 5% and 3.1% in 2025 and 2026, respectively. Mexico, meanwhile, is only expected to grow 1.4% and 1.9% in the same years, which would represent a slowdown.
López Obrador’s presidency is characterized by having expanded and increased social assistance with programs for older adults, parents and students or young apprentices. Argentina, for its part, is currently experiencing cuts to social assistance and government spending under the mandate of President Javier Milei, a declared far-right who seeks to balance public finances after years of high fiscal deficits and inflation. Milei and López Obrador have shown that they directly and openly disagree on policies for their countries.
“In essence, in the face of the neoliberal project of the International Monetary Fund and the World Bank, in the face of that project, there is another one called Mexican humanism with moral economy and it works better than the one they have been imposing for more than 30 years and that they still want to return to.” to plant, to establish it or to reestablish it,” López Obrador commented on Tuesday. He also warned that Mexico must “beware of the recommendations of international financial organizations because before there were no development plans of our own, but rather they were recipes that were sent to us from abroad.”
In November, Mexico renewed a flexible credit line for up to $35 billion with the IMF. Additionally, on June 3, the World Bank approved a $1 billion loan to the country, Latin America’s second largest economy, to be used for projects that take advantage of the relocation of global companies, a trend known as nearshoring.
Representatives of both multilateral institutions entered into communication with the president-elect, Claudia Sheinbaum, days after her electoral victory on June 2. Sheinbaum had posted on social media that she had spoken with IMF director Kristalina Georgieva, but the post was deleted.
I was delighted to speak to 🇲🇽 President-Elect Claudia Sheinbaum (@claudiashein) and congratulate her on her historic election. Mexico can count on the IMF’s continued support as you advance the economic agenda. https://t.co/u0YLF2Lauh
— Kristalina Georgieva (@KGeorgieva) June 6, 2024
Last month, IMF spokesperson Julia Kozack responded to a journalist’s question about the country by saying: “We see an economy that continues to expand and inflation is receding in Mexico. Inflation has declined since early 2023, driven by proactive monetary policy and a drop in global commodity prices. And growth in Mexico is being supported by domestic demand, especially investment.”
Kozack added that it was important for the organization to observe the fiscal measures that Mexico will undertake in the coming years. “We are calling for a credible medium-term fiscal consolidation plan aimed at preserving fiscal sustainability in Mexico. And, of course, ensuring sustainable and inclusive growth in Mexico, as in many other countries, will also require a broad set of reforms. These include boosting the workforce, female participation in the workforce, better tackling corruption and crime and expanding financial inclusion.”
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