Public investment to GDP, at historic lows under AMLO's administration

The six-year term of President Andrés Manuel López Obrador has been marked by a notable drop in public investment compared to previous governments, reaching a ratio of public investment to Gross Domestic Product (GDP) of only 2.7%, the lowest since Ernesto Zedillo's term.

This figure highlights the weaknesses of the current economic model, where public investment has concentrated on iconic projects in the center and south of the country, neglecting key regions such as the north and west.

Although gross fixed capital formation, which includes both public and private investment, totaled 22.3% of GDP, the fact that private investment reached 19.6%, the highest in the last five six years, contrasts with the lack of progress in public investment. This disparity in investment highlights the need for a more balanced approach that not only focuses on large projects, but also encourages infrastructure development throughout the country.

Within this context, the strengths of the Mexican market are centered on the ability of private initiative to adapt and grow, even when the government has not met its investment expectations.

Private initiative has demonstrated its resilience and ability to sustain levels of economic activity. 

However, the current situation also presents opportunities for greater collaboration between the public and private sectors, which could result in a joint drive towards improved infrastructure and regional development.

On the other hand, weaknesses are evident in the lack of investment in critical areas such as energy, communications and transportation, which limits the country's competitiveness in the global context. This decline in infrastructure investment could negatively impact productivity and job creation, thus affecting long-term economic growth.

In terms of threats, the situation becomes more complex, as the lag in infrastructure may lead to economic stagnation. If the next government does not redirect its focus towards a more balanced and strategic public investment, Mexico could face an uncertain future in terms of growth.

The lack of adequate infrastructure may discourage foreign investment and limit the ability of companies to expand and compete, generating a cycle of low growth that would affect all regions of the country.

The current outlook reveals a clear need to reassess investment strategies in Mexico. Dialogue between government and private initiative will be crucial to address current challenges and take advantage of growth opportunities. The question is how to balance public and private investment to drive sustainable economic development that benefits all regions of the country.

Collaboration: Editorial Auge.