The IMF projects a 0.3% contraction in Mexico’s GDP for 2025 due to Trump’s tariffs, but President Sheinbaum insists her government’s economic models and “Plan Mexico” will avert recession.

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The International Monetary Fund (IMF) has sounded alarms by forecasting a 0.3% contraction in Mexico’s GDP for 2025, attributing it to tariffs imposed by the United States and geopolitical uncertainty. However, President Claudia Sheinbaum dismissed the projections, asserting that her administration prioritizes autonomous economic models and the “Plan Mexico” to strengthen manufacturing and domestic markets.

The IMF slashed its 2025 growth forecast by 1.7 percentage points, stating that Mexico will be the hardest hit by U.S. protectionist measures, even more than Canada or China. Despite the USMCA trade framework, the IMF argues that tariffs on Mexican products,including those recently announced by Trump,will stifle growth.

During her morning press conference, the Mexican leader rejected the IMF’s outlook, accusing the institution of underestimating state capacity to counter external crises: “They’re used to dictating policies, but we disagree with their neoliberal vision.” Sheinbaum emphasized that Mexico’s Finance Ministry uses independent models predicting stability.

En el Museo Nacional de Antropología, la presidenta @Claudiashein anuncia avances y nuevas medidas del Plan México, que contempla 18 programas y acciones para fortalecer la economía y el bienestar en nuestro país.

📸: https://t.co/UHEvOZlPaQ pic.twitter.com/9HLratwmtj

— Gobierno de México (@GobiernoMX) April 3, 2025

The text reads: At the National Museum of Anthropology, President @Claudiashein announced progress and new measures under Plan Mexico, which includes 18 programs and actions aimed at strengthening the economy and well-being in our country.

“Plan Mexico”: A Progressive Response to Trump

As an alternative to austerity measures, the government will unveil a package on May 5 to boost manufacturing and reduce U.S. dependency under the “Plan Mexico.” While details remain undisclosed, Sheinbaum stressed it will prioritize public investment, local employment, and productive sovereignty, aligning with her anti-neoliberal agenda.

The Organisation for Economic Co-operation and Development (OECD) projected a 1.3% GDP contraction for 2025, doubling the IMF’s pessimism. Both institutions agree that trade tensions will restrict financing access and increase inflation, particularly in automotive and agro-industrial sectors.

Analysts aligned with Mexico’s Fourth Transformation (4T) movement argue the IMF ignores the impact of social programs like universal pensions and record-high minimum wages, which sustain domestic consumption. They also criticize the institution for overlooking reindustrialization efforts in southern Mexico, driven by projects like the Interoceanic Corridor.

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