Wednesday, May 20, 2009

Mexican economy shrinks 8.2% in First Quarter of 2009

INEGI, the Mexican government statistical agency, revealed today (to see report click here) the Mexican economy has had negative growth for the second consecutive quarter, which by definition puts Mexico's economy into the category of recession. In the fourth quarter of 2008 the economy fell 1.6% and in the second quarter it fell 8.2%. Some sectors were worse than others. Commerce was down a whopping 17.2%, and manufacturing was down 13.8%. These two categories weigh heavily in the economy of Juarez, so if we add to the downturn of the economy the effect of the swine flu scare and the quasi-martial law in Juarez, overall business conditions must be extremely poor in our sister city to the south.

Finance Minister Agustin Carstens today indicated he believed the economy would not recover until the end of the year, and he revised previous estimates of Mexico's economic growth in 2009 down to a decline of 5.5% from previous estimates of 4.8%. The effect of the swine flu scare is estimated to generate a .3% decline in gross domestic product.

No comments: