AMLO says GDP forecasts will be proven wrong
President Andres Manuel Lopez Obrador (AMLO) said on Friday that lower gross domestic product (GDP) forecasts were being put forth by his rivals but will eventually be proven incorrect.
“The year isn’t over yet. Let’s wait and see. It’s as if there’s a bet, and we’re going to beat their forecasts,” the president said in his daily news conference at the National Palace.
AMLO said “technocrats, corrupt individuals and conservatives are very annoyed” by his government and therefore are coming out with poor forecasts all the time.
“They’re sticking to this refrain of a slowdown in growth, as if they’d brought about a lot of growth in 36 years,” the president said in reference to previous governments that achieved average GDP expansion of 2 percent, or half of what Lopez Obrador is aiming to achieve.
The president said the recent forecasts do not take into account a key variable.
“There’s no longer the corruption that existed when they were governing. When there’s corruption, there’s no growth,” he said.
“In 36 years of neoliberal policy, there were three crises” in which “the economy completely collapsed,” Lopez Obrador said, recalling that during the first year of former President Ernesto Zedillo’s 1994-2000 administration the economy contracted 7 percent.
“I’m pleased,” the president said, noting that no economic crisis has occurred since he took office in Dec. 1.
On Thursday, the Paris -based Organization for Economic Co-operation and Development (OECD) lowered its Mexico growth forecast for 2019 to 1.6 percent, down four-tenths of a percentage point from an earlier projection.
It said in its latest overview of Mexico’s economy that “investment remains subdued, reflecting policy uncertainty domestically as well as abroad” and that “declining oil production continues to be a drag on the economy and fiscal revenues.”
In a survey published Thursday, private-sector economists polled by Mexico’s central bank also slightly lowered their growth forecast for Mexico in 2019.
They predicted GDP would expand by 1.52 percent, down from a forecast of 1.56 percent growth last month.
According to data from the National Institute of Statistics and Geography (Inegi), Mexico’s GDP inched up just 0.2 percent in the first quarter of 2019 compared to the same period last year, which represents the lowest annual growth since 2009.
The International Monetary Fund also lowered its 2019 and 2020 growth forecasts for Mexico to 2.1 percent and 2.2 percent respectively. It had earlier projected the country would grow 2.5 percent and 2.7 percent this year and next.
“They’ve been on about this in recent days, but we’re certain we’re doing very well,” Lopez Obrador said in the news conference.
The president also reiterated his pledge that Mexico would attain average annual GDP growth of 4 percent by the end of his six-year term in 2024, accompanied by very low inflation.
Source: Latin American Herald Tribune