The economic policy facing the economic crisis is being insufficient to resume growth

Abstract

The work analyzes how the economic crisis faced by Covid-19, the governments and central banks of developed countries are increasing public spending and lowering the interest rate to levels close to zero and yet they still cannot exceed the problems. The least developed countries are limited in making their fiscal and monetary policies more flexible to recover the economic growth, which together with the lack of international cooperation, makes the pandemic and the crisis worse. The pandemic arrives in Mexico when the economy was already facing a recession, which leaves it weak to face the problems. The Mexican government, instead of changing the policy of fiscal austerity that caused the stagnation, maintains it, thus deepening the problems, showing that it is not measuring the magnitude of the crisis. There is no prospect that exports, remittances, tourism, capital inflows, will grow again as before the crisis, so by not changing economic policy, the crisis will be prolonged. The article proposes to rethink our insertion into globalization, as economic policies to combat the pandemic and to achieve sustained growth with full employment.