The slowing is due in part to declining foreign investment, an economist says.
Mexico’s economic activity was flat in the second quarter of the year, as Latin America’s second-biggest economy and Arizona’s leading trading partner narrowly dodged a recession.
Gross domestic product, a measure of a country’s output in goods and services, registered no change, according to a statement published early Friday by the INEGI, the country’s official statistics agency.
The economy has slowed in part on declining foreign investment, as investors lose confidence in President Andrés Manuel López Obrador, who has canceled public works projects such as a $13 billion new airport just outside Mexico City, said Alejandro Cervantes Llamas, an economist and columnist for daily newspaper El Universal.
Yet Mexico could become an even more important ally for border states such as Arizona, where many companies trade across the border, as Mexican goods and services become cheaper on the slightly declining currency, and as the U.S. engages in a trade war with China, Cervantes Llamas said.
“The slight depreciation of the Mexican currency we’ve seen in the last few months could improve Mexico’s exports with the U.S.,” Cervantes Llamas said. “We have a better comparative advantage in regard with all of Mexico’s main competitors like China.”