This editorial by Arturo Huerta González originally appeared in the November 18, 2025 edition of La Jornada de Oriente, the Puebla edition of Mexico’s premier left wing daily newspaper. The views expressed in this article are the author’s own and do not necessarily reflect those of Mexico Solidarity Media*, or the Mexico Solidarity Project.*
Neoliberal governments have proceeded to promote the entry of capital through high interest rates, fiscal austerity, and the inflow of foreign investment to increase international reserves and lower the dollar and imports, thus contributing to lowering inflation, at the cost of not having an economic policy for growth and to satisfy the national demands of the population, and of imports displacing national production.
The reduction in inflation achieved through dollar exchange rates and cheap imports has been detrimental to domestic producers. It has led to an increased foreign trade deficit, deindustrialization, the decapitalization of producers, over-indebtedness, higher import levels, and a loss of self-sufficiency in basic grains.
The government is more concerned with promoting capital inflows to finance the external deficit and maintain a stable exchange rate, instead of addressing the national production shortcomings that underlie the external deficit. As a result, imports and the need for capital inflows to finance them continue to grow, and the economic policy that encourages this inflow is detrimental to national production.
The policy that favors the growth of cheap imports of staple grains is discriminatory, harming domestic producers and benefiting US producers, a situation that jeopardizes self-sufficiency and food security. Furthermore, the policy of weakening the dollar by promoting capital inflows with high interest rates benefits the financial sector at the expense of the indebted national public and private sectors, increasing their financial costs and reducing their capacity for spending and investment. This contributes to the stagnation that the national economy has been experiencing, with high rates of underemployment, poverty, and crime.
Imports have increased more than domestic production and have grown in their share of national supply and demand. Agricultural imports are equivalent to 48% of agricultural production, resulting in a year-on-year loss of food sovereignty and a greater dependence on capital inflows to finance this situation.
The greater the dependence on imports of staple grains and other products, coupled with insufficient exports and/or capital inflows to finance them, the more the supply of goods to meet demand will be compromised, leading to inflation, devaluation, and a slowdown in economic activity. Therefore, if domestic production and import substitution are not promoted, a profound crisis is imminent.
The lag in agricultural production ultimately hinders the financing of the economy due to price pressures caused by product shortages, as well as impacting the external sector. Increased imports lead to a leakage of demand abroad, which in turn reduces national income and savings, and consequently, investment financing. The resulting trade deficit necessitates high interest rates to attract capital for financing, and these high interest rates are depleting the productive sector’s capital and increasing its debt burden, making credit more expensive, and hindering growth financing. Furthermore, the stagnation of the national economy jeopardizes the repayment of financial obligations, further restricting credit availability and destabilizing the banking sector.
Agricultural development is crucial for reducing inflation, imports, and the foreign trade deficit; for improving national income and financing; and for lessening our dependence on capital inflows. This would allow us to lower interest rates and increase public spending to promote economic growth. Hence the importance of an agricultural policy to boost domestic production, which requires responsive monetary, exchange rate, fiscal, and trade policies through affordable credit, subsidies, protectionist measures, and a competitive exchange rate.
Protecting domestic producers by suspending imports of staple grains, either by removing them from the USMCA and/or by imposing tariffs on equivalent imports, would allow for fair prices that cover production costs and provide a margin to increase investment. In the case of corn, this would be 7,200 pesos per ton. This could lead to price increases in the short term, but it would be the cost of advancing self-sufficiency and food sovereignty. When combined with a sound agricultural policy, this would increase investment and productivity, and lower prices. This would reduce pressure on the external sector, as well as the need for capital inflows, allowing for economic policies that boost national economic activity and job creation.
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