How are we doing?

2025 is an exceptional year, but the Mexican economy is behaving suspiciously normally. I think of exports to the United States, which grew 4.3% in the first half of the year and are moving as if we weren't in the era of Trump and MAGA. I note that Foreign Direct Investment is up more than 10% and breaking records, as if there weren't a renegotiation of the USMCA looming and a reform of the Judiciary full of question marks.

These are exceptional times, but we're still in familiar territory when we look at the behavior of GDP and inflation. Mexico is growing less than 1%. This is a pittance, but it's not out of step with the growth seen during the previous six-year term. Inflation was 3.51% in July and is within the Bank of Mexico's target range, although households have other data. Housewives want to know where the store is where things are rising less than 5% annually.

Regarding GDP, we have an anomaly and a "return to normal." The anomaly is the performance of manufacturing, which has been stagnating for two years after long being one of the stars of the Mexican economy. The return to normalcy corresponds to the southern states that benefited from projects such as the Maya Train and the Dos Bocas refinery. Two or three years ago, there was talk of how strange it was to see Tabasco leading the national growth figures. Now it is in the red, with negative rates of 10.2 and 12.3% in the last quarter of 2024 and the first of 2025.

The start of Sheinbaum's six-year term is marked by an extremely difficult time for public finances, a legacy of López Obrador. The government is committed to reducing the 5.7% of GDP deficit recorded in the government accounts in 2024. To do so, there is no other way than to reduce spending and improve revenue. In practice, this means increasing tax pressure on individuals and businesses to increase revenue. In terms of spending, social programs are untouchable. The major adjustment variable is public investment, which fell by nearly 30 percent.

The economic package for 2026 will be presented in the coming days. What will the deficit and public investment look like? The government's commitment is to maintain the deficit reduction path, although no one expects a major cut in the second year. There may be a small revival of public investment, as there is minimal room for maneuver.

This reactivation of public investment is necessary, among other things, to give budgetary credibility to the announced projects: the rescue of Pemex; the expansion of CFE's infrastructure; the construction of more than one million homes; the production of an electric car; and new rail routes, among other things.

The issue isn't just budgetary, because it includes a new narrative. We're seeing the advancement of a vision of an entrepreneurial State, a 4T version. Uncomfortable questions hang in the air: How much will it cost and where will the money come from? How can we avoid repeating the experience of the 1970s or the crony capitalism of the Salinas administration? How far does the government want to go in partnerships with the private sector? How much appetite do business owners have for partnering with the government?

Plan Mexico is the roadmap for the economic policy of Sheinbaum's six-year term. The commitment to a "Made in Mexico" development makes sense, given the vulnerability that stems from our extreme dependence on the United States. Plan Mexico is ambitious, so much so that a 50% completion rate would be enough to be a success. Little by little, we'll see what rating this administration deserves for its execution capacity.

Finally, it's impossible to talk about 2025 without mentioning the factors beyond the Mexican government's control. We've said many things about Trump, but we've barely touched on climate risk. These are droughts and floods that are taking their toll on a country that is unprepared. Mitigation and remediation are concepts that deserve greater inclusion in public and private budgets.

There are four months left until the end of 2025 and five years left until the end of the six-year term. How are you feeling? How are we doing?