In 2024, Mexico’s pivotal presidential election sees two women candidates vying for the country’s leadership for the first time after Andrés Manuel López Obrador’s term.
This election will shape Mexico’s fiscal and economic path, highlighting critical issues like fiscal management, public finance deficits, and Pemex’s financial state.
On June 2, Mexicans will choose from over 19,000 public officials, including the president.
Claudia Sheinbaum and Xóchitl Gálvez, representing various political alliances, are the main contenders. Their campaigns, starting March 1, will reveal their economic strategies.
Soime analysts predict the next leader will face fiscal realities. Despite claims of prudent spending, public expenditure in 2024 is at a century high.
A 3% GDP spending cut is expected in 2025, mirroring Argentina’s current approach.
Janneth Quiroz from Grupo Financiero Monex emphasizes the election’s impact on public finance and the necessity for tax reform.
With a significant deficit increase expected in 2024, understanding the candidates’ plans is crucial.
AMLO’s administration has set a historic deficit for 2024 to fund social programs and infrastructure projects.
Analysts, however, doubt the feasibility of reducing the deficit to the proposed 2.6% of GDP by 2025.
Alfredo Coutiño from Moody’s Analytics highlights the election’s importance for Mexico’s economic course.
The outcome will determine whether the country continues its current state-centric approach or shifts towards a more competitive, market-driven economy.
Mexico’s ongoing growth challenges
Coutiño also points out Mexico’s ongoing growth challenges, linking them to a lack of productive investment.
He hopes for policies that address structural growth issues through capital accumulation and productivity enhancement.
Quiroz notes the election’s role in setting the stage for long-term economic stability and growth. Each administration plays a crucial part in improving the population’s well-being.
Looking ahead, AMLO’s government expects Mexico’s GDP to grow between 2% and 3% annually from 2025 to 2029.
This forecast depends on U.S. economic policies and their impact on trade.
Banxico predicts a modest economic growth range for 2025. In contrast, surveyed analysts expect a 2% growth in the first year of the new administration.
This election not only determines Mexico’s next leader but also the country’s fiscal and economic direction for years to come.