(Adds comments from central bank governor)
MEXICO CITY, April 12 (Reuters) – Mexico faces a “new challenge” as different parts of its economy will recover at varying paces, with export-dependent industries expected to lead the way, Bank of Mexico Governor Alejandro Diaz de Leon said on Monday.
Mexico’s economy contracted by 8.5% in 2020, its deepest dive in almost 90 years, due to the ravages of the COVID-19 pandemic. However, the economy recovered faster than first estimated in the final quarter of 2020.
“The new challenge is economic activity and the recovery will be heterogeneous, powered by two engines. The engine of vaccinations … and the engine of fiscal spending that different economies have put in place,” said Diaz de Leon.
The massive $1.9 trillion pandemic rescue package in the United States, Mexico’s top trade partner, is likely to help fuel the recovery of the Mexican economy.
Last year, the most important component for the recovery of economic activity in Mexico was external demand and the export sector, well above consumption and investment, said Diaz de Leon.
“And we anticipate moving forward that this important spending and stimulus program in the United States will help external demand to continue to play an important role” in Mexico’s economic recovery, he added. (Reporting by Anthony Esposito; Editing by Frank Jack Daniel)
