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Mexico is the second largest economy in Latin America after Brazil, and enjoys abundant natural resources. Until 2018, Mexico enjoyed healthy macroeconomic fundamentals, supported by an high level of diversification and resilience to economic shocks following a series of structural reforms implemented in 2014. Real GDP grew by 2.7% on average in 2014-2018.

However, even before the COVID-19 outbreak, real GDP growth had been slowing (real GDP decreased by 0.1% in 2019) and macroeconomic fundamentals have been eroded, following the election of Andres Manuel Lopez Obrador in mid-2018. Uncertainty surrounding its policy decisions (and particularly the participation of the private sector in key sectors of the economy, such as the energy sector), along with the erosion of institutional strength in the regulatory framework, have resulted in a significant deterioration in the business climate. In this context, the Covid-linked crisis added to structural weaknesses and led to a severe recession in 2020.