Mexico hit hard by US downturn
Jul 03, 2009
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When America sneezes, Mexico catches a cold; this time, the US did a lot more than sneeze, and Mexico has come down with severe pneumonia, says UBS.
Unlike most of the region, it is highly exposed to America, which takes 80% of its exports. These comprise 25% of overall GDP and most of the exposure is in the highly cyclical manufacturing sector.
Overall exports were down by an annual 36% in April. Swine flu could wipe 2.2% off second-quarter GDP, says the World Bank.
This year Mexico's economy could fall by 8.5%, the most since 1932, Goldman Sachs estimates.
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