Normality is returning to Mexico City. Unfortunately, the Mexican economy is not. The economy is clearly beginning to lag, which has enormous implications for public finances and employment. The Ministry of Finance has just revealed that federal income has decreased while government expenditures have increased. This cannot be good for the national debt. It seems that the H1N1 virus turned out to be less harmful for the country than the international financial crisis.
Apparently, the outbreak of the H1N1 was effectively managed. This does not mean that the dozens of deaths were meaningless, that tourism was not affected, or that the stress in Sino-Mexican relations will soon be forgotten. In spite of this, it seems that the federal government did avoid a major health incident. Although the country did not have a vaccine for the social effects of the outbreak, it controlled it and now things are beginning to return to normality.
The Mexican economy, however, did get a vaccine against the effects of the financial crisis—a loan from the IMF. Yet, the economy has been hardly hit and only a long and painful treatment will be able to get Mexico back in shape. But how did a healthy economy manage to get so sick? Well, maybe the economy was not doing that well in the first place. Remember the reduction in remittances and the weak peso of October 2008? It is unfortunate that the IMF loan was only approved in April 2009. By then, the Mexican economy was already infected.
