Another is that Mexico is mainly a manufacturing exporter, and thus it did not overly benefit from previously booming commodity prices. Third, long-stagnant total factor productivity reveals pervasive inefficiencies in the economy. Furthermore, since the middle of 2012, Mexico was hit by a succession of domestic shocks, including the bankruptcy of major housing developers and a contraction in public investment.
In 2014, the economy started to pick up, driven first by more dynamic exports of goods and services, and more recently, by stronger private domestic demand. Third-quarter data on industrial production and retail sales suggest that momentum continues. The broad-based outlook is one of gradual recovery during the rest of this year and in 2015.