The government must abandon its policy of fiscal austerity and stop responding to international rating agencies and financial capital. It must act in favor of national production & employment.
Mexico avoids straining relations and, at the same time, avoids pursuing an industrial policy that might affect established interests, particularly those of large transnational corporations. External constraints & internal indecisiveness reinforce each other.
Mexico’s banking industry, which profits from interest rates that reduced the spending and investment capacity of the government, businesses, and heavily indebted households; has a bizarrely rosy outlook for 2026.
The government must rethink its economic policy in order to strengthen the national productive sector, advance import substitution to reduce the foreign trade deficit, and curb capital inflows, thereby becoming less susceptible to the vagaries of international events.
By questioning the fiscal deficit and public debt, rating agencies and conservatives aim to limit government intervention in the economy, forcing it to restrict spending and investment, making the economy dependent on the investment decisions of the private sector.
While the Mexican government attempts to curry favour to receive preferential treatment in USMCA negotiations, it ignores the fact that the Trump administration violates all established international norms and makes decisions only based on US interests.
As long as Mexican banking remains deregulated, it will continue to be detrimental to growth, generating high profits at the expense of debtors, both in the public and non-financial private sectors.
If public investment continues to decline, the economy & employment will be highly vulnerable, and the foundations for sustained growth will not be laid. At best, we will remain a vast assembly plant; at worst, a country without decent employment opportunities.
Mexico’s redistributive social programs have had tangible, laudable benefits, but continuing to redistribute revenues received from taxing the working class in an economy that lacks domestic productive capacity and a financial system that fails to channel industrial credit only filters money into imports and strengthens foreign multinationals.
Mexico has fallen into a growing dependence on foreign direct investment, granting greater tax incentives to multinational corporations while in the first half of 2025, public investment fell by 30%, writes Arturo Huerta González.