Economy of Mexico

The economy of Mexico is a developing mixed-market economy. It is the 13th largest in the world in nominal GDP terms and by purchasing power parity as of 2024. Since the 1994 crisis, administrations have improved the country's macroeconomic fundamentals. Mexico was not significantly influenced by the 2002 South American crisis and maintained positive, although low, rates of growth after a brief period of stagnation in 2001. However, Mexico was one of the Latin American nations most affected by the 2008 recession, with its gross domestic product contracting by more than 6% that year. Among OECD nations, Mexico has a fairly strong social security system; social expenditure stood at roughly 7.5% of GDP.

The Mexican economy has maintained high macroeconomic stability, reducing inflation and interest rates to record lows. Despite this, significant gaps persist between the urban and the rural population, the northern and southern states, and the rich and the poor. Some of the unresolved issues include the upgrade of infrastructure, the modernization of the tax system and labor laws, and the reduction of income inequality. Tax revenues, 19.6 percent of GDP in 2013, were the lowest among the 34 OECD countries. The main problems Mexico faces are poverty rates and regional inequalities remaining high. The lack of formality, financial exclusion, and corruption has limited productivity growth. The medium-term growth prospects were also affected by a lower proportion of women in the workforce, and investment has not been strong since 2015.

The economy contains rapidly developing modern industrial and service sectors, with increasing private ownership. Recent administrations have expanded competition in ports, railroads, telecommunications, electricity generation, natural gas distribution, and airports, to upgrade infrastructure. As an export-oriented economy, more than 90% of Mexican trade is under free trade agreements (FTAs) with more than 40 countries, including the European Union, Japan, Israel, and much of Central and South America. The most influential FTA is the United States–Mexico–Canada Agreement (USMCA), which came into effect in 2020 and was signed in 2018 by the governments of the United States, Canada, and Mexico. In 2006, trade with Mexico's two northern partners accounted for almost 90% of its exports and 55% of its imports. Recently, Congress approved important tax, pension, and judicial reforms. In 2023, Mexico had 13 companies in the Forbes Global 2000 list of the world's largest companies.

Mexico's labor force consisted of 52.8 million people as of 2015. The OECD and WTO both rank Mexican workers as the hardest-working in the world in terms of the number of hours worked yearly. Pay per hour worked remains low.

Mexico is a highly unequal country: 0.2% of the population owns 60% of the country's wealth, while 46.8 million people live in poverty (2024).