Around the world, the blunt measures imposed by central governments to fight the COVID-19 pandemic are causing widespread economic hardship. In its latest report on the state of the global economy, the International Monetary Fund forecasts that most advanced and emerging economies will experience their worst downturns since the Great Depression, as global GDP is set to contract by an estimated 4.9 percent this year. The recovery will not come fast, it warns, with growth expected to be sluggish in 2021.
Mexico is no exception, but its economic troubles predate the pandemic. And while most countries are crafting policies to claw their way out of this catastrophe, Mexican President Andres Manuel Lopez Obrador has pursued an improvised and messy strategy that might trigger the worst depression the country has seen in almost a century. Foreign investors should worry. Mexican citizens and business leaders should panic.
Since taking office in December 2018, AMLO, as Lopez Obrador is popularly known, has pushed ahead on a singular project: to bring about what he calls the “Fourth Transformation” of Mexico’s public and political life. The first three transformations were the independence movement (1810-1821), the Reform War (1857-1861) and the Mexican Revolution (1910-1924), all of which reshaped the social, economic and political landscape of Mexico.