Failed state

Doña Patty is a lady who, at almost 70 years old, continues to work, every day she gets up at 5 AM to take the poor transportation to her work, without omitting that necessity forced her to do so in the midst of the pandemic and the difficult situation of insecurity that we women go through. She is a beneficiary of the pension for older adults, that is, she receives a bimonthly payment of 3,850 pesos, which she spends on the medications she needs for life for her right leg condition. Mrs. Patty does not have social security, nor a pension for old age, nor her own house, much less does she have the right to get sick because she no longer has popular insurance; but despite all this, she does not give up, from a very young age her parents instilled in her to work hard to get her family forward.

The Mexican economy is like Mrs. Patty, it has solid foundations and does not give up, which is why Mexico has managed to remain resilient despite the many external shocks we have received, such as the war in Ukraine, the Covid-19 pandemic and the instability of energy prices. However, it is inadmissible that Mexico remains adrift, despite our great strengths, every day the climate of uncertainty and concern intensifies, dragged by an inertia that does not allow us to create the minimum conditions of security, employment, growth and welfare that we Mexicans deserve.

While other countries found in the misfortune of the pandemic the opportunity to stimulate digital trade and technology, protecting the most vulnerable, Mexico seemed like a blind country, which never understood the importance of maintaining security and investment conditions.

Inflation continues to rise drastically reaching levels never seen before, chicken, tomato, avocado, oil are through the roof. The Inegi reported that inflation has already reached 7.6% per year, the highest figure for more than 20 years.

Mexico was the country that decreased the most during the pandemic, almost 9% of GDP, and Mexico is one of the countries that will take the longest to recover its dynamism. In recent weeks, practically all international organizations, including the Bank of Mexico, once again cut their economic growth expectations for the country to 2%. This figure is lower both than the world average (3.6%) and the performance of the United States (3.7%), Latin America (2.5%), and even Nigeria (3.7%) a country much less developed than us.

What should be done to restore growth?

  1. Maintain macro stability.
  2. Recover the competitiveness lost in the last three years, increasing the offer of better products and innovation.
  3. Greater financing for the productive sector.
  4. More and better infrastructure.
  5. Reduce the informal economy and at the same time increase the quality and supply of jobs.

Of course, to achieve these objectives, we need an effective social policy focused on the most backward regions, the reconstruction of the educational and health system, improving security and having an efficient justice system. Unfortunately, today we live in a failed state, with millions of Mexican men and women like Patty, with a government that for three years has been immersed in the past, unable to understand the present and much less interested in building the future.

Twitter: @PerezSoraya


Economist

between numbers

Former President of the Federation of Colleges of Economists of the Mexican Republic AC

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