
Mexican government economic data points to the nation’s economy having gained momentum in the first quarter of 2018, with quarterly GDP growth registering 1.1 percent, compared to 0.9 percent in the final quarter of 2017.
According to data summarized in an online report by Reuters, that data remains unchanged from a preliminary estimate made in April 2018.
A source quoted by Reuters credited growth in Mexico’s service sector as one positive factor, while manufacturing, agriculture and construction activity also contributed to the good quarter.
A Goldman Sachs analyst contacted by Reuters said the ongoing uncertainty about the Trump Administration’s attitude toward the North American Free Trade Agreement (NAFTA) continues to act as a restraint on business investment, including foreign direct investment.
On that front, Mexican President Enrique Pena Nieto stated in late May that he thinks progress is being made in the three-way dialog between the United States, Mexico and Canada concerning NAFTA, despite the Trump Administration pressing for automotive content changes.
In late May, according to another Reuters report, Nieto spokesperson Eduardo Sanchez indicated Mexico would not “buckle to pressure” to hastily conclude the negotiations. “Mexico is not going to negotiate on the basis of pressure; Mexico is very clear about what works and what doesn’t work for us,” Sanchez stated.
The Nieto administration is reportedly staying in close contact with the Trudeau government in Canada and with automakers in Japan, who are affected by where components are made and shipped as part of their North American operations.
The negotiations may not be at a standstill, as on May 24 Mexico had reportedly made a counter-offer on country of origin vehicle content levels.
That may have been spurred by the Trump administration threatening to use national security measures to curtail automotive imports.
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