Mexico’s Positive Economic Data Often Overlooked

Although casual observers often do not appreciate it, Mexico has set the stage for solid economic growth.  In 2012, its gross domestic product (GDP) was 3.3 percent, almost double that of the United States.  Its budget deficit for that year was 2.6 percent of GDP, far less than the 7 percent for the United States.  Its national debt stands at just 28 percent of its GDP, where the corresponding figure for the United States is a hefty 105 percent.

Mexico’s inflation rate- historically problematic- has been 4.3 percent since reforms were adopted in 2001.  The banking industry is better capitalized in Mexico than in the United States.  Furthermore, the number of banks in the country expanded a healthy 14 percent in 2012, whereas that number was actually negative for the United States.

Along with its plentiful energy resources, Mexico’s embrace of free trade has helped it grow.  Exports and imports account for over 60 percent of the country’s economic output.

In short, the Mexican economy scores more favorably than the United States’ economy in several important areas.  As developed countries continue to wrestle with high debt loads and sluggish economies, investors may look to Mexico for a better return on their investments.

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