World Bank Pins Mexico at 1.3% Growth as USMCA Review Nears
Mexico · Economy
Key Facts
—The forecast. The World Bank kept Mexico’s 2026 growth at a thin 1.3 percent, the slowest of any large economy in the region.
—Slow road. The bank sees Mexico crawling to 1.7 percent in 2027 and 1.9 percent in 2028, below 2 percent for years.
—The catch. Mexico’s fate hangs on trade with the United States and a make-or-break review of their joint pact that opens on July 1.
—A vote of confidence. E-commerce giant Mercado Libre pledged 4.6 billion dollars of fresh investment in Mexico this year, its largest annual outlay ever.
—Up 35%. That figure is a third bigger than last year’s commitment and is meant to create 8,500 jobs across 19 states.
—Next stop Washington. Economy minister Marcelo Ebrard travels to Washington this week for the next round of trade talks.
The Mexico economy sits in an awkward spot: a global lender keeps its growth forecast stuck near the bottom of the region, even as one of Latin America’s biggest companies bets billions on its future.
The World Bank held its 2026 growth forecast for Mexico at 1.3 percent on Wednesday, leaving the country at the back of Latin America’s larger economies. The figure came in the bank’s twice-yearly Global Economic Prospects report, which downgraded growth for two-thirds of the world’s economies.
Mexico’s number is striking for what it is not. Unlike Brazil or Colombia, the country barely feels the energy shock rattling the rest of the world, because its oil trade is roughly balanced.
Why the Mexico economy is stuck near the bottom
Instead, Mexico’s problem is trade, and above all its relationship with the United States. The bank expects growth to inch up to 1.7 percent in 2027 and 1.9 percent in 2028, a recovery so gentle it barely registers.
The country grew just 0.6 percent in 2025, its weakest showing since the pandemic. Activity actually shrank in early 2026 as factories slowed and companies held back on new spending while they waited for clarity on trade rules.
That clarity is still missing. The bank says investment will only recover once firms know how the trade relationship will look.
The trade review hanging over everything
At the center of the uncertainty is the USMCA, the free-trade pact that binds Mexico, the United States, and Canada and replaced the older NAFTA deal. The three governments are due to review it starting July 1, and the outcome will shape Mexican exports for years.
The stakes are high because the United States buys the overwhelming majority of what Mexico sells abroad. President Donald Trump has even floated scrapping the agreement, a threat that hangs over every investment decision in the country.
President Claudia Sheinbaum pushed back this week, defending the pact and insisting Mexico holds a strong hand. Economy minister Marcelo Ebrard said Mexico still faces a lower effective tariff into the US market than most of its rivals, giving it an edge over Asian competitors.
Ebrard heads to Washington this week for the next round of talks, expected to run from June 15 to 18. JPMorgan chief Jamie Dimon added his own warning, saying Mexico’s success will depend on whether it can offer investors enough certainty.
A billion-dollar bet against the gloom
Against that cautious backdrop, one company made a loud statement of faith. Mercado Libre, the Argentine-founded online shopping and payments giant that is Latin America’s most valuable company, said it will invest 4.6 billion dollars in Mexico during 2026.
It is the firm’s largest annual commitment to the country ever, a 35 percent jump on the 3.4 billion it spent in 2025. The money will go into warehouses, technology, and its fast-growing financial arm.
Announced at Sheinbaum’s morning press conference by Ebrard, the plan is meant to create 8,500 jobs across 19 states and lift the company’s Mexican workforce to about 42,000. Since 2020, Mercado Libre will have poured more than 14 billion dollars into Mexico.
For the government, the timing was perfect. Sheinbaum framed the pledge as proof of confidence in the country, pairing it with news that inflation has dipped below 4 percent.
What it means for investors
The two signals sit in tension. A global lender sees a near-stagnant economy, while a marquee company is doubling down, and both can be true at once.
The deciding factor is the same one the bank keeps flagging: the trade review. A clean outcome in Washington could unlock the investment that has been sitting on the sidelines, while a messy one could keep Mexico treading water.
Frequently Asked Questions
What growth does the World Bank expect for Mexico in 2026?
The bank held Mexico’s 2026 forecast at 1.3 percent, the slowest of any major economy in Latin America. It sees only a gradual pickup to 1.7 percent in 2027 and 1.9 percent in 2028.
Why does the USMCA review matter so much for Mexico?
The United States buys most of Mexico’s exports, so the terms of their shared trade pact directly shape the economy. A review starting July 1 will set those terms, and the uncertainty is already holding back business investment.
How big is the Mercado Libre investment?
Mercado Libre pledged 4.6 billion dollars for Mexico in 2026, its largest annual figure ever and 35 percent above the prior year. The company expects to create 8,500 jobs across 19 states.
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