Mexico Faces 3% GDP Hit from Potential US Remittance Tax

Mexico braces for potential economic blow from US remittance tax. Mexico's Secretary of Finance, Edgar Amador Zamora, has issued a stark warning about the potential impact of a proposed US tax on remittances sent to Mexico. Zamora estimates the tax could reduce Mexico's GDP by 3%, significantly affecting several states. "Imagine the size of the problem," Zamora stated, highlighting the dependence of many families on these funds. Chiapas, Guerrero, Zacatecas, and Michoacán are expected to be particularly hard hit, as these states receive a large portion of remittances from Mexicans living in the US. In response, a Mexican legislative commission is set to travel to Washington next week to lobby against the tax. The urgency of the situation is underscored by the recent downward revision of global growth projections by the International Monetary Fund, adding to the economic uncertainty. While the situation is concerning, the recent announcement of a large investment plan by BBVA in Mexico offers a glimmer of hope, suggesting continued confidence in the Mexican economy despite the challenges.