Mexican Economy Contracts 17% as Lockdown Devastated Activities

Official data showed on Friday that the Mexican economy suffered a record contraction in April, as the effects of the closure of coronaviruses affected economic activity across the country.

Adjusted for seasonal fluctuations, Latin America's second largest economy contracted by 17.3% from March, the largest drop since recent data began publishing in early 1993, according to figures set by the National Statistics Agency (INEGI).

However, the decline was not as sharp as the 19.4% drop forecast shown by a Reuters survey of economists. Figures showed that on unadjusted terms, the economy contracted 19.9% in April compared to the previous year.

Lockdown demands have dealt huge blows to the main pillars of the Mexican economy. These ranged from a monthly drop of over 25% in industrial output in April to a slightly shallow drop in retail sales.

The government hopes the economy will perform slightly better in May, when it gradually began to allow sectors such as the auto, mining and construction industries to return to work.

Mexico has quickly become one of the countries most affected by the novel coronavirus in the world.

With more than 15,000 deaths, it officially has the seventh highest global death toll, according to Johns Hopkins University tracker.

With a weak health system, high poverty rates, and government officials who have long chosen to ignore the severity of the virus, the country is now feeling the pinch.

But as numbers continue to rise, the country is still planning to gradually reopen its economy as it faces increasing pressure from the US to operate factories operating on the border.