According to the World Bank's latest economic report, the Mexican economy is estimated to grow 2.3 percent this year, a downward revision of 0.3 percent from previous estimates.
This slowdown contrasts with the 3.2 percent growth recorded last year, and this trend is projected to continue until at least 2026.
Despite the interest generated by nearshoring, there is no significant increase in commitments for new foreign investment in the country, according to bank experts.
The report, titled “Competition: the missing ingredient for growth?”, updates the economic outlook for Latin America and the Caribbean, projecting growth of 1.6 percent in 2024 for the region.
This growth is expected to accelerate in the following years, reaching 2.7 percent and 2.6 percent in 2025 and 2026, respectively.
The World Bank warns that the region faces a critical situation, with stagnant growth that requires urgent measures to reverse the situation and maintain the economic progress achieved in previous decades.
In a virtual press conference, the World Bank's chief economist for Latin America and the Caribbean, William Maloney, highlighted Mexico as a relevant case study in the context of nearshoring.
The term refers to the interest of global companies in moving their operations from China to countries considered “allies” of the United States or Europe, their main markets.
However, although this trend was expected to boost growth in Latin America, no significant impacts are yet seen in terms of new foreign investment commitments in the country.
World Bank reduces growth projections due to situation in Argentina
The World Bank released an update of its growth forecasts for Latin America and the Caribbean, reducing the figure by seven tenths compared to previous estimates in January, placing it at a modest 1.6 percent.
This downward revision is mainly due to the economic situation in Argentina, as explained by the bank's head for Latin America, William Maloney, in an interview with EFE.
The WB forecast indicates that, excluding data from Argentina, the region would grow 2.2 percent this year, just one tenth less than projected in January.
However, the WB estimates that Argentina will experience a contraction of 2.8 percent in 2024, attributing this drop to the fiscal adjustment implemented by Javier Milei's government to combat inflation.
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