the covid - 19 pandemic and the fiscal and monetary policies implemented to mitigate it, together with the effects of the war in ukraine, have been the main factors that have determined the global economic environment and economic policy priorities in the world. first, the performance of the global economy is less now than it was three years ago. the slowdown of the asian emerging economies, especially china, given the pandemic closures and the deepening of the housing crisis, explains part of it. the downward revision of growth in europe has also been influenced by the war in ukraine. in addition, above all, we must highlight the tightening of monetary policy associated with the resurgence of inflation as a global phenomenon. lower growth and high inflation have significant implications for capital flows to emerging economies. in mexico, the economic landscape has also changed substantially over the past three years. in june 2019, a stagnation of economic activity was already perceived, led by the weakening of domestic demand, particularly investment. however, overall inflation showed a downward trend, while core inflation, which eliminates the most volatile prices and better reflects domestic inflationary pressures, remained above our inflation target of 3 %. since then, an environment of considerable uncertainty for the growth of the mexican economy had already stood out, and the risk balance was downwards. the main concerns stemmed from uncertainty due to global trade disputes and the extended ratification process of the usmca. however, the slowdown in domestic investment and consumption was also a cause for concern. regarding inflation, while there was also a perception of significant uncertainty, the balance of risks remained balanced. currently, the growth outlook has deteriorated, but unlike 2019, it is now mainly responding to the weakening of the external environment. on the other hand, domestic demand has recovered gradually, primarily driven by consumption. however, inflation has risen to unrecorded levels in two decades, and there are signs of price formation contamination and the beginning of the de - anchoring of inflation expectations. therefore, since june 2021, banxico began to raise its benchmark rate by 450 basis points from 4 % to bring it to 8. 5 %, the highest level in history. it is clear that reducing inflation towards our target is a job that needs to be done ; otherwise, the costs would be much higher. thus, we expect to face a global environment characterized by economic weakness with high - interest rates for longer than expected. price stability is the foundation for investment and sustained growth. but

manuel sanchez : mexico ’ s reforms progress and economic outlook remarks by mr manuel sanchez, deputy governor of the bank of mexico, at the 2015 institute of international finance ( iif ) latin america economic forum, busan, republic of korea, 28 march 2015. * * * i would like to thank the institute of international finance for the invitation to participate in this conference. it is an honor to share the panel with such distinguished speakers and to be in south korea, an economy that has shown extraordinarily rapid development in the last few decades, achieving the level of an industrialized nation in an amazingly short lapse of time. mexico has benefited greatly from economic ties with south korea. in particular, this country is the second most important source of investment from asia to mexico, especially in manufacturing, commerce and mining, and it is also a significant trading partner. in this talk, i would like to touch first on structural reforms recently undertaken in mexico and, second, comment on mexico ’ s economic outlook. as usual, my views are entirely my own and do not necessarily reflect those of the bank of mexico or its governing board. mexico ’ s progress on structural reforms mexico has embraced an ample program of structural reforms encompassing labor, education, the financial system, telecommunications, and energy, among other areas. the general aim is to promote greater market flexibility, investment in both human and physical capital, and competition, thereby boosting total factor productivity growth, the stagnation of which has inhibited long - term overall economic expansion. legislative changes necessary for the reforms have been passed by congress, and the country is currently in the process of implementing them. challenges are inherent in this task. as all of us know, the effectiveness of reforms anywhere in the world rests heavily on the details. today, i would like to bring you up to date specifically on the telecommunications and energy reforms, given the essential role these sectors play in the overall economy and consumer wellbeing. the telecommunications sector has been characterized by limited access and high cost. in both telecoms and broadcasting services competition has been scant, with each sector dominated by one company. in particular, the privatization of the government telephone operator more than two decades ago transferred exclusive fixed - line rights to one buyer, without adequate regulation favoring serious competition. in the following years, new providers of telecoms services encountered a playing field that was not at all level. while some price reductions occurred thanks to incipient competition, services remained expensive and their quality