Mazzucato urges Mexico to shed low-cost factory image and boost innovation

Mariana Mazzucato, a veteran economist who studied in Mexico in 1989, evaluated the Sheinbaum administration’s Plan Mexico, a mission-oriented growth blueprint. She warned that without realistic implementation, the plan risks becoming mere rhetoric, pointing to Mexico’s low tax base, rent-seeking by large firms, and the fact that only 35% of financing reaches productive sectors. The report she co-authored calls for a revamp of tax policy, including capital-gains, wealth, inheritance and gift taxes, while avoiding regressive measures like higher VAT.

Mazzucato stresses the need for coordinated action among development banks such as Banobras, Nafin, Bancomext and Fonadin, especially for projects like water restoration in the Tula basin. She also stresses that public investment must be paired with conditions for private investors to ensure equitable outcomes. Finally, she urged a more integrated North American trade framework, noting that Mexico should stop being merely a low-cost supplier for U.S. firms and instead develop its own technological capabilities.