Mexican Economy Suffers Setback in 4Q21
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Mexican Economy Suffers Setback in 4Q21

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Emilio Aristegui By Emilio Aristegui | Junior Journalist and Industry Analyst - Wed, 02/09/2022 - 15:43

The Mexican economy had a complicated 4Q21, as the country registered a 0.1 percent setback in its GDP. Economists explained that the country is going through a technical recession. Meanwhile, fintech’s began to embrace sustainable responsibilities, as they grow their operations in Mexico.

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Mexican GDP Drops in 4Q21

Mexico’s GDP contracted 0.1 percent in 4Q21 against 3Q21, following an INEGI report showing a 0.7 percent decrease in tertiary economic activities. Primary and secondary activities presented a minor rise of 0.3 percent and 0.4 percent, respectively. After a staggering 19.9 percent growth in 2Q21, the country’s GDP underperformed after consistent growth throughout the year. The Mexican economy grew back 4.8 percent this year, after a major 8.2 percent collapse in 2020.

Fintech’s Must Deliver Sustainable Solutions

“There is a more or less general consensus that the vision of the future of business must reside in a latent need for the creation of models in which environmental, social and corporate governance (ESG) criteria play a central role in strategies, operations and prospects. In other words, acting now is not an option for organizations but, rather, a substantial imperative that must encompass everything,” said Leticia Robles, Director of Sustainability, Impact and Business, Konfio.

Mexico Enters Recession

Mexico registered a second consecutive quarter without economic growth, going into a technical recession. President López Obrador says otherwise, considering that the country grew 5 percent. He attributed the setback to the new COVID-19 variant. López Obrador also said that his focus was solely on the well-being of people.

Real-Time Payments are Vital for Companies

“Real-time payments offer many benefits in terms of speed, convenience, added value and financial progress. I believe that the time has come in Mexico, when sending or receiving money across this system is as fast and even more convenient than cash. Moreover, real-time payments are an incredible incentive for the general population to become banked, since it is as easy as sending or receiving instant payments from their smartphone,” said Iñigo Rumayor, Co-Founder, Arcus Financial Intelligence.

Private Sector Lowers Growth Expectations

Headline and core inflation expectations increased in Januarty 2022, with worse expectations arriving after December 2021. Mexico’s growth expectations for 2022 and 2023 decreased, as the country’s GDP suffered a small contraction in 4Q21. For the year 2023, private sector specialists lowered their estimations from 2.21 percent to 2.14 percent annual growth.

Photo by:   Image by Gavinseim from Pixabay

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