Mexico will grow less than expected effect of Trump: IMF – Expansion MX

WASHINGTON (AFP) –

The International Monetary Fund (IMF) revised down the growth estimates for Mexico in 2017 and 2018 due to the “headwinds stronger” that the country faces in the wake of the uncertainty about the economic policies to be adopted by Donald Trump.

For this reason, the agency downgraded by 0.6 percentage points your expectation of the economic performance of Mexico for this year and next. Now expect a growth of 1.7% in 2017 and 2% in 2018.

Read: 5 keys to Mexico to negotiate with Donald Trump

Even before assuming power, Trump launched a frontal offensive against automotive industries in the united states (or subsidiaries of foreign firms, such as Toyota) for making investments in assembly plants in Mexico for the u.s. market.

The IMF also revised down their expectations of economic performance of Latin America in their review of the global economic landscape.

according To the new forecast, Latin America will grow in 2017, 1.2%, equivalent to 0.4 percentage point below forecast in October and 2.1% in the next year.

This box, Latin american, said the IMF, is based in part on a “lesser expectation of short-term recovery of Argentina and Brazil”, countries that showed in the second half of 2016 “growth figures that disappointed expectations.”

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In the case of Brazil, the IMF forecasts that the south american giant to close this year with growth of 0.2%, a downward revision of 0.3 percentage point. The entity did not alter their expectation of progress of 1.5% in the next year.

According to the IMF, the reduction of the expectation of the performance of Latin american this year, is also due to the “deterioration in uninterrupted of the situation in Venezuela.”

global level

The IMF kept unchanged its forecast of a growth of the global economy of 3.4% in 2017.

In its quarterly review of the Global Economic Landscape, the entity stated that the expectations for this performance are marked by the “particular uncertainty” about the policies of the government of Donald Trump, who will assume power this next Friday.

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In this scenario marked by uncertainty, the IMF stressed especially the evident signs of increased protectionism in the international trade.

according To the IMF, the world economy will end 2017 with a growth of 3.4% and 3.6% in 2018, as had been expressed in October.

The financial institution came even to revise slightly upwards its growth forecast for the united States in 2017 and 2018 at 2.3% and 2.5%, respectively, by the power of fiscal stimulus.

“Particular uncertainty”

The IMF adopted a forecast different to the one used by the World Bank, which maintained its growth outlook for the united States precisely because of the lack of certainty.

The Fund noted that for the preparation of your predicted scenario for the united States this year, was based on proposals of the president-elect, in particular those who defend a higher public spending on infrastructure works.

For this reason, the IMF noted that for his next edition of the World Economic outlook, due to be launched in April, “will emerge more clearly on the policies of the united States and its implications for the world economy”.

at The same time, the financial institution mentioned that “the political events of recent highlights the erosion of the consensus around the benefits of the economic integration cross-border”, in a skewed reference to the positions put forward by Trump.

In this box, the entity noted that an increase of the restrictions to global trade and migration “would hurt the productivity and income, and would immediately the mood of the markets.”