Mexico Projects Up To 2.5% Economic Growth, Smaller Deficit in 2027 Budget Draft

MEXICO CITY – Mexico's finance ministry forecasts economic growth between 1.5% and 2.5% in 2027. The broader public sector deficit is projected to narrow to 3.9% of gross domestic product (GDP) that year, according to a draft budget proposal submitted to Congress on Tuesday.

The budget document indicates a 2026 growth estimate of 1.0% to 2.0%. This is a decrease from an earlier projection of 1.8% to 2.8%. The projected 2027 public sector deficit of 3.9% of GDP compares to 4.1% estimated for 2026.

Factors driving the 2027 economic outlook include strong domestic demand, higher household incomes, and less restrictive financial conditions. Investment linked to infrastructure projects and tax incentives under the "Plan Mexico" initiative are also expected to contribute. Additionally, export growth supported by North American trade integration is anticipated to provide further support.

Total public debt, measured by the Historical Balance of Public Sector Borrowing Requirements (SHRFSP), is expected to reach 55.0% of GDP in 2027. This is up from the estimated 54.0% for year-end 2026. Headline inflation is projected to end 2027 at 3.0%, aligning with the Bank of Mexico's official target.

State oil firm Pemex is slated to receive 81.1 billion Mexican pesos ($4.80 billion) from the federal government in 2027 to help pay down its debt. This amount is less than the 263.5 billion pesos allocated in the previous budget. The government also earmarked 255.5 billion pesos for Pemex's priority investment projects.

The macroeconomic framework assumes Mexico's crude export mix will average $61.80 per barrel in 2027, down from an estimated $78.40 per barrel in 2026. Total liquid hydrocarbon production is projected at 1.80 million barrels per day.

Source: Originally reported by Reuters.

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