It’s official – Mexico recorded its worst economic contraction since the Great Depression in 2020 as the coronavirus pandemic and associated restrictions ravaged the economy.
GDP plunged 8.5% last year, according to final, revised data published Thursday by the national statistics agency Inegi.
The figure, which represents the worst economic result since GDP slumped more than 14% in 1932, is the same as the one published by Inegi in January based on preliminary data.
Mexico’s economy has now contracted during two consecutive years after GDP declined 0.1% in 2019.
It is the second time this century that Mexico has suffered back-to-back annual contractions as the economy also shrank in 2001 and 2002. Before that the most recent consecutive contractions were in 1982 and 1983 when Mexico was mired in a debt crisis.
President López Obrador took office in late 2018 promising average annual growth of 4% during his six-year term. That outcome now looks almost impossible to achieve, although GDP is forecast to bounce back strongly in 2021 – at least compared to the economic nightmare of 2020.
The president himself is predicting a 5% rebound this year, a forecast more optimistic than most but not beyond the realms of possibility.
The newspaper El Financiero reported that López Obrador’s prediction appears based on optimistic forecasts from institutions such as the rating agency Moody’s, which is forecasting 5.5% growth this year.