Mexico’s Gross Domestic Product boosted by Industry
Mexico’s Gross Domestic Product grew slightly more than expected in 2023, even though some analysts expected a drop in 2023.
In this sense, Mexico’s Gross Domestic Product grew in 2023, showing that the Mexican economy experienced a slightly higher than expected growth of 3.2%.
At the end of that year, an expected 3.1% had been forecast.
But Mexico’s Gross Domestic Product grew after a boost fueled by the industrial sector.
According to revised Gross Domestic Product (GDP) figures released by the National Institute of Statistics and Geography (Inegi).
Mexico’s Gross Domestic Product boosted by Industry
Industry stood out with an increase of 3.5% during the aforementioned period, representing the highest rate among the divisions evaluated.
It was followed by the services sector, which, contrary to forecasts, grew by 3.1%, exceeding estimates of 2.9%.
On the other hand, agricultural production performed more modestly, with a growth of 1.9%, slightly below the expected figure of 2.0%.
Focusing on the last quarter of 2023, overall GDP showed a modest rise of 0.1%, in line with the institute’s initial projections.
However, the outlook for industry was less encouraging, registering a decline of 0.1% over the same period, falling below the neutral forecast. Manufacturing faced a 0.5% contraction, influenced by both an unfavorable base effect and weakness in external markets.
Mexico’s Gross Domestic Product grew in the services sector, with a quarterly increase of 0.3%, exceeding expectations of 0.1%. It is worth noting that this sector had just experienced a 0.9% increase in the previous quarter.
In particular, entertainment experienced a strong rebound of 4.3%. Meanwhile, education and health care also showed significant gains. In contrast, retail trade fell by 0.3%, although the wholesale sector achieved growth of 1.0%.
On the other hand, primary activities suffered a 1.0% drop in the last quarter, attributed to adverse weather conditions that negatively affected agriculture.
Read more: The U.S. economy in 2023 grew more.
Mexico’s Gross Domestic Product grew in 2023 vs. other years
It is worth noting that Mexico’s Gross Domestic Product grew in 2023 despite being flat in the last month of the year.
Finally, the Global Indicator of Economic Activity (IGAE), which acts as a monthly reflection of GDP, remained static in December, exhibiting a more favorable behavior by not registering the 0.3% decrease that had been anticipated.
Broken down by sector for the last month of the year, agricultural activities rebounded by 7.9%, while industry fell by 0.7% and services remained unchanged, contrary to the expected 0.3% decline.
In 2022, Mexico’s Gross Domestic Product grew 3.9 percent, above the 3.1 percent published a year ago and slightly below the 4.0 percent target estimated by President Andrés Manuel López Obrador at the beginning of his term.
In 2021, the expansion was 5.7 percent, as an effect of the rebound after the pandemic year, in which GDP contracted 8.6 percent.
In 2019, the first year of AMLO’s administration, GDP fell 0.3 percent, according to INEGI.
