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Mexico - September 2020

ECONOMIC HIGHLIGHTS

Falling investment: On 6 August Mexico’s national statistics institute (Inegi) released figures for May on gross fixed capital formation (GFCF), according to which investment in fixed capital goods such as machinery and equipment fell by 38.4% year-on-year, and by 4.5% compared with April. A breakdown of the figures reveals a 43.8% year-on-year drop in spending on machinery, and a 33.1% drop in construction spending. Inegi president, Julio Santaella, noted that this decline brought GFCF to its lowest level since 1997, which he attributed to the impact of the coronavirus (Covid-19) pandemic. Meanwhile the economy ministry (SE) has reported that incoming foreign direct investment (FDI) for the first half of 2020 totalled US$17.97bn, a 0.7% drop compared to the same period in 2019. The manufacturing sector accounted for 43.2% of this total, followed by financial services & insurance (15.4%), transport (14.1%), trade (6.6%), and mining (4.9%). As regards sources of FDI, the US accounted for 38.6%, Canada 19.1%, Spain 11.2%, and Germany 6.8%.

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