World Bank cuts growth forecast for Mexico in 2019

The World Bank (BM) downgraded on Thursday growth forecasts for Mexico and Latin America 0.9% in 2019, when he advocated for more social programs for the "poorest and most vulnerable" in the region.

During the presentation of the semester report on the economic outlook for Latin America and the Caribbean, Carlos Végh, head of the World Bank for Latin America and the Caribbean, stressed that Mexico started the year with "modest, but stable" growth, so the Washington-based agency expects growth of 1.7% for 2019, the lowest level in 6 years.

Vegh explained that this level is due to a lower export demand, especially from the United States, since the Agreement Mexico, United States, Canada (T-MEC)and the fact that the markets are worried about what the energy policies of the new administration might be in the future.

However, the economist pointed out that several factors explain these forecasts, some of which are medium and long term; that is, they can not be attributed to events from last year.

The body too reduces growth forecasts to 0.9% for Latin America in 2019, due to the weak development of countries such as Brazil, Argentina and Mexico, added to the collapse of Venezuela under the dictatorship of Nicolás Maduro .

Excluding Venezuela, however, the World Bank expects Latin America and the Caribbean to grow 1.9% in 2019 and 2.7% in 2020.

This week, the Ministry of Finance and Public Credit (SHCP) of Mexico presented the General pre-criteria for the 2020 economic policy, in which it reduces its forecasts of growth and budget revenues for this year due to the low level recorded in recent months and the lower oil revenues in the country.

According to the document submitted to the Chamber of Deputies, end of 2019 the economy will grow between 1.1 and 2.1% instead of between 1.5% and 2.5% estimated. In 2020, "the point estimate" is 1.9%.

SHCP felt that this year's budget revenues are lower 121,200 million pesos to those provided for in the Federation Income Law (LIF) 2019.

"These estimates are inertial in that they do not take into account the effects of the current administration's economic development strategy or other factors. implies greater growth"says the document.