Tag Archives: petroleum

Mexico goes all-in on refining

Mexico’s state-owned national oil company Petróleos Mexicanos (Pemex) announced earlier this year that it plans to significantly reduce crude petroleum exports in 2022 and phase out crude exports altogether by the end of 2023. The news was reported widely in domestic and international media. We have criticized President Andrés Manuel López Obrador (AMLO) in this space, but in fairness we must acknowledge that he is clearly not afraid to launch bold and decisive new public policy initiatives, for better or worse. We continue to question, however, whether many of them are a good idea. Continue reading Mexico goes all-in on refining

Recent and upcoming investment in Mexico

COVID-19

Mexico has suffered something of a setback in its emergence from the COVID-19 pandemic over the past month.  On the epidemiological traffic light system, Mexico City had reached green, or mild restrictions, as the beginning of the month only to return to the higher restrictions of the yellow level following the June 6 national elections.  The number of states at the orange or significant restriction level rose from one to five during the month, with reported increases in COVID cases particularly in tourist zones such as the Riviera Maya (Cancun), Yucatan and Baja California.  No PCR test or quarantine is required to enter Mexico for travelers arriving by air.

ECONOMY AND INDUSTRY

  • Same-store retail sales jumped 33.9% in May with respect to the same month last year, the National Retailers Association (ANTAD) reported. The size of the increase is due largely to the plunge in sales in May 2020 resulting from the initial COVID-19 lockdowns. (Reforma, June 11, 2021)
  • Mexico’s central bank Banco de México (Banxico) raised its projection of GDP growth to 6.0% for the current year, up from a previous estimate of 4.8%. The improved outlook is based on advances in COVID-19 vaccination, strong demand for exports and better than expected first quarter growth. (Citibanamex Reporte Económico Diario, June 3, 2021)
  • Remittances to Mexico from abroad through the first four months of the year are running 19.1% ahead of the same period last year, central bank Banco de México (Banxico) reported. Remittances are on track to post their strongest annual growth since 2005. (Milenio, June 1, 2021)

Continue reading Recent and upcoming investment in Mexico

Recent and upcoming investment in Mexico

COVID-19

Mexico’s COVID-19 indicators have generally improved over the past month.  The number of new cases per day has declined steadily compared to January, and the national rate of hospital bed occupation is down to 40%.  Bed occupation is higher in the Mexico City area at 60%, however this is an improvement over the peaks of 90% reached in January.  Mexico’s vaccination campaign is gaining speed after a poorly executed launch, however the number of vaccinations administered lags behind the average rate of most developed countries. (Data taken from Citibanamex Monitoreo de COVID-19, February 25, 2021)

ECONOMY AND INDUSTRY

  • Retail sales in Mexico contracted 9.3% in 2020 with respect to the previous year, reaching their lowest level since 2014, according to data from the National Statistics Institute (INEGI). The only subsectors posting positive growth were online and catalog sales (52%) and health-related products (6%). (El Economista, February 25, 2021)
  • Mexico’s construction industry was hit hard by the economic slowdown in 2020, contracting 17.5% on the year, according to data from the National Statistics Institute (INEGI). The drop-off is the steepest for the industry since 1995. (Reforma, February 12, 2021)
  • Remittances from abroad to Mexico represented 3.8% of the country’s GDP in 2020, a record high. The total value of remittances to Mexico grew by over 10% last year with respect to the previous year. (El Economista, February 1, 2021)

Continue reading Recent and upcoming investment in Mexico