Mexico Shipping Report Q2 2015
BMI View: We remain optimistic toward Mexico's long-term growth outlook on the back of a booming manufacturing sector, an increasingly strong private consumer and favourable demographics. As a result, we retain a cautious optimism towards the country's shipping sector. Mexico's real GDP growth will accelerate in 2015, driven by an improvement private consumption, stronger growth of manufacturing exports, and a recovery in public investment. Furthermore, we expect an uptick in private fixed investment into the country's recently liberalised energy sector, as the first oil licensing round begins in H115. We believe real GDP growth in Mexico bottomed in H114, coming in at 1.7% year-on-year (y-o-y), and expect the economy to sustain a recovery in the coming quarters. We forecast real GDP growth of 3.7% in 2015.
Lower oil prices will contribute to a stronger US consumer, resulting in greater demand for Mexican manufactured goods exports. Mexico's manufacturing sector accounts for over 17.0% of GDP and is a main generator of employment. As a result, more favourable labour market dynamics, combined with the diminishing effect of a tax hikes on consumer goods that were implemented in January 2014, will lead to significantly stronger household spending in 2015, providing a boost to box imports. An uptick in fixed investment into infrastructure and energy will also be a main driver of faster headline growth in the coming quarters.
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