Mexico’s mining industry—which includes the world’s largest gold mine—is expected to fully reopen today after the government ordered mines to
Mexico’s mining industry—which includes the world’s largest gold mine—is expected to fully reopen today after the government ordered mines to close on April 2 to combat the COVID-19 pandemic.
Since the May 18 government announcement for the reopening, 80% of mines have restarted operations. Subject to safety protocols being adhered to (such as compulsory virus-testing and social distancing measures), the mine will still be allowed to operate even if someone tests positive for COVID-19 on-site.
Restarting the mining industry is unlikely to arrest a predicted 6-8% contraction in economic growth this year—a recession second only to that of Venezuela. Given 50% of the workforce is in the informal sector without any social security support or employment protections, layoffs are expected to force 22 million Mexicans into poverty.
At this stage, the economic downturn is unlikely to be alleviated by further government stimulus. President Andres Manuel Lopez Obrador is reluctant to run up debt. The modest economic stimulus—0.5% of GDP and second-lowest in Latin America—is aimed mainly at low-income individuals; moreover, the $10 billion assistance for small and medium-sized businesses is also minimal. Instead, Lopez Obrador is relying on China’s weakening economy to attract foreign investment to Mexico.
Wake up smarter with an assessment of the stories that will make headlines in the next 24 hours. Download The Daily Brief.