Mexico Faces Another Decade of Weak Growth

Mexico could be heading toward another “lost decade” of economic growth as its expansion remains below the pace needed to significantly improve living standards and strengthen its productive capacity.

The Economic Commission for Latin America and the Caribbean (ECLAC) cut its forecast for Mexico’s economic growth in 2026 to 1.3%, below the regional average. The projection highlights the country’s continued struggle to accelerate after several years of weak performance.

Mexico’s economy has grown at an average rate of around 1% annually over the past six years, considerably below the approximately 1.9% average recorded between 2000 and 2018. If growth remains below 2% in 2026 and 2027, the country could experience four consecutive years of expansion below what analysts consider its potential growth rate.

ECLAC’s outlook reflects several structural challenges facing the Mexican economy, including weak investment, low productivity, and uncertainty surrounding international trade. The country is also increasingly affected by demographic changes as its working-age population expands more slowly.

The outlook comes despite expectations that Mexico could benefit from nearshoring and the reorganization of global supply chains. However, insufficient investment and limited productivity gains have prevented the country from fully capitalizing on these opportunities.

The weak growth trajectory also puts pressure on Mexico to implement measures capable of boosting investment, productivity, infrastructure, and industrial development if it wants to achieve stronger and more sustainable economic expansion in the coming years.