Obrador: Mexico Could See Economic Benefit From Russia-Ukraine War

By Mary Webber First Posted: Mar 21, 2022 08:59 PM EDT

Mexico President Andres Manuel Lopez Obrador noted on Monday that Mexico's economy will get an investment boost amid the Russia-Ukraine war.

Lopez Obrador predicted that the capital once destined for Russia and other emerging economies will now be funneled into Mexico, according to a Reuters report.

The Mexican president cited an unidentified "financial report" for his projection. He also forecasted a boost in economic growth and employment in Mexico.

Lopez Obrador said during a regular morning news conference that with the new economic crisis coming from Russia-Ukraine, Mexico will be one of the top countries with the most investment opportunities globally.

The United States, Britain, and the European Union have enforced sanctions against Russia for Ukraine's invasion.

It leads to the Russian currency's tumble and the departure of foreign businesses.

Lopez Obrador said that with the shift, Mexico is in the top levels now.

Mexico on Russia-Ukraine Crisis

Early March, the Mexican president announced that Mexico will not impose any economic sanctions on Russia for its invasion of Ukraine, according to an NBC News report.

He also criticized social media companies for what he called as censorship of Russian state-sponsored media.

Lopez Obrador said that Mexico will not be imposing any economic sanctions as he wants to have good relations with all the governments in the world.

Meanwhile, other Latin American governments, such as Cuba, Venezuela, and Nicaragua, have created strong links with Russia.

However, Russia's ties with Mexico are seen to be limited due to the strong U.S.-Mexico relations.

Lopez Obrador's announcement came in response to a question about the interest in Mexico of Russia's second-largest oil producer Lukoil and Russian airline Aeroflot.

The Mexican president also said that Mexico will not be sending arms to Ukraine after Ukrainian representatives had asked Mexico's Senate for arms and military assistance, according to another Reuters report.

Lopez Obrador said that Mexico does not "send guns anywhere," adding "we are pacifists."

Ukrainian representatives said in a letter to the Mexican Senate that only "military and massive support" of their allies can help them block the "enemy."

Mexico Economy

The Organization for Economic Co-operation and Development said that the world has experienced significant economic and financial shocks, which could reduce global GDP growth by over one percentage point in the following year if sustained, according to an Andalou Agency News report.

Mexico's central bank also said that pandemic shocks on inflation have been deeper and longer-lasting than expected. The bank also said that it could not rule out new price pressures caused by the Russia-Ukraine crisis.

Bank of Mexico, known as Banxico, said that the current crisis between Russia and Ukraine could lead to higher commodity prices, particularly for energy and agricultural products. Supply chain interruptions and higher wage costs could also lead to inflationary pressures, according to another Reuters report.

Banxico governor Victoria Rodriguez earlier cautioned that it was too early to tell how the Russia-Ukraine crisis would affect prices and inflation. However, Rodriguez noted that the conflict would be one of the many factors that would be taken into consideration in monetary policy decisions.

This article is owned by Latin Post.

Written by: Mary Webber

WATCH: Ukrainian, Russian refugees seeking asylum at US-Mexico border - from ABC News