With a population of almost 130 million, a rich cultural history and diversity, and abundant natural resources, Mexico is among the 15 largest economies in the world and the second-largest economy in Latin America. The country has solid macroeconomic institutions, is open to trade, and has a diversified manufacturing base connected to global value chains.
Over the last three decades, Mexico has underperformed in terms of growth, inclusion, and poverty reduction compared to similar countries. Its economic growth averaged just above 2 percent a year between 1980 and 2022, limiting progress in convergence relative to high-income economies.
The Mexican economy grew by 3.1% in 2022, after a bounce back of 4.7% in 2021, and a 8.0% fall in 2020 due to the COVID-19 pandemic. The economy has recovered its employment and Gross Domestic Product (GDP) pre-pandemic levels. Mexico’s stable macroeconomic framework, the U.S. dynamism, and solid manufacturing base will support economic growth.
To accelerate sustainable economic growth and poverty reduction over the medium term, Mexico needs to address structural constraints such as limited access to finance, insecurity, informality, regulatory burdens, and infrastructure bottlenecks. Tackling these challenges is essential to fully seize the opportunity that nearshoring represents in the current international environment.
Last Updated: Apr 04, 2023