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Mexico social policy will bring rewards and risks

Wednesday, December 28, 2022

Significance

Such moves have proven highly popular and may go some way towards explaining the enduring popularity of President Andres Manuel Lopez Obrador (AMLO) in the face of high crime rates and meagre economic growth.

Impacts

  • Universal pensions for the elderly have benefitted the wealthy as much as the poor, increasing inequality.
  • The upcoming 2024 elections will probably encourage the government to increase pensions substantially in that year’s budget.
  • Heavy spending on social programmes, at the expense of public investment, will hinder future economic growth.
  • A lack of adequate controls in enrolling individuals in social programmes could encourage corruption.

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