Why didn’t Mexico implode? That may be one of the biggest economic mysteries left in the wake of COVID-19. Mexicans weathered a disproportionate blow: By the first anniversary of the pandemic, Mexico had suffered the second highest rate of excess death in the world, trailing only Armenia.
The government of President Andrés Manuel López Obrador did little to mitigate the suffering. It executed the tightest budget in Latin America in 2020 and then trimmed spending in 2021. “The support in response to COVID-19 was notably less than that of emerging market (EM) and regional peers,” noted the International Monetary Fund in its 2021 assessment.
A study by researchers at Tulane University about COVID’s impact on Latin America’s four largest economies found that social assistance was expanded to offset the shock to poverty and inequality in three of them. The exception? “The offsetting effect is nil in Mexico since no expansion of social assistance took place in the country,” they wrote.
