Mexico faces a critical international economic situation in 2025, being the only OECD country projected to enter a recession this year. This situation is further complicated by the constant threats of tariffs by the United States under Donald Trump’s leadership, trade tensions with China, and the imminent renegotiation of the United States-Mexico-Canada Agreement (USMCA).
The OECD forecasts a contraction of up to 0.5% in the Mexican economy by 2025, making it the only nation in this group projected to experience a recession. This crisis is due to internal factors, such as low public investment, widespread insecurity, and a lack of legal certainty for investors, in addition to an insufficient and slow response from the federal government to these challenges.
According to Valeria Moy, director general of the Mexican Institute for Competitiveness (IMCO): “The lack of effective action by the federal government in the face of these economic challenges is alarming and is rapidly eroding the confidence of international investors.”
Trade Issues with the United States and China
The trade war between the United States and China has generated great uncertainty, directly affecting key sectors in Mexico such as the automotive, technology, and manufacturing sectors. Furthermore, former US President Donald Trump has repeatedly threatened to impose punitive tariffs on Mexico under immigration and trade arguments.
Fernando Díaz, an agricultural producer from Sinaloa, states: “Trump’s constant threats to impose tariffs on our agricultural products have left us in a state of permanent uncertainty, affecting our exports to the United States.”
Furthermore, Mexico’s technological dependence on China has increased its vulnerability to this dispute, paralyzing the production of essential components for various industries.
The renegotiation of the USMCA comes at a critical time for Mexico. The United States, under pressure from former President Trump, is seeking more restrictive changes, especially in the automotive and agricultural sectors, generating greater uncertainty.
Kenneth Smith Ramos, former chief negotiator of the USMCA, explains: “Trump continues to push for tougher terms, putting the country’s trade stability at risk. Mexico must be prepared for a very complicated negotiation.”
Impact on Mexican Society
Economic uncertainty, the recession, and the threat of tariffs are directly impacting the daily lives of Mexicans. Rising inflation and the increase in the cost of living are affecting millions of households.
Rosa Elena Martínez, a supermarket employee in Monterrey, shares: “Every week I see prices rising and my salary worth less; we really can’t even afford the basics anymore.”
Experts point to the urgent need for the government to implement clear policies to mitigate these effects on the most vulnerable population.
To overcome these challenges, Mexico needs to act urgently. Experts recommend strengthening investment in infrastructure, promoting trade diversification, improving the business environment, and establishing a firm strategy in the face of Trump’s threats.
Luis Rubio, president of México Evalúa, suggests: “Mexico must abandon inaction and demonstrate a decisive and strategic response to international threats. Only then can we confront this crisis.”
Mexico’s current international economic situation demands an immediate and strategic response. The federal government must act with clarity, determination, and effectiveness in the face of the projected recession, trade threats, and the renegotiation of the USMCA. Mexico’s ability to react appropriately will determine the country’s economic and social course in the coming years.
Source: yoinfluyo
