Mexican President Claudia Sheinbaum has rejected International Monetary Fund (IMF) forecasts predicting the country's economy will contract by 0.3% in 2025, insisting her government's economic strategies will counteract the impact of US tariffs.

In its World Economic Outlook published on April 22, the IMF dramatically revised its outlook for Latin America's second-largest economy, now expected to shrink by 0.3% in 2025, having projected 1.4% growth just three months earlier. The fund's outlook, influenced by the erratic tariff policy of the US administration under President Donald Trump, slashed the global economic growth forecast for this year to 2.8%, while the GDP growth projection for the Latin America and the Caribbean region is down to 2.0%.

“The swift escalation of trade tensions and extremely high levels of policy uncertainty are expected to have a significant impact on global economic activity,” said the Washington-based multilateral lender in its report.

Countering these bleak predictions during a press conference, Sheinbaum stated: "We have models from the Finance Ministry that do not coincide with this approach," criticising international organisations for "dictating policies to sovereign nations."

"We have a plan to strengthen the Mexican economy," she added.

The president said her administration's "Plan Mexico" strategy would sustain economic activity despite external pressures, according to El País. This plan focuses on boosting domestic production, North American regional integration through United-States-Mexico-Canada-Agreement (USMCA), and replacing Asian imports, particularly from China.

On April 2, Sheinbaum's government lowered its economic growth forecast for 2025 to a range of 1.5% to 2.3%, citing uncertainty over US policies, AFP reported. Mexico is seeking an agreement with the Trump administration to lift tariffs on key automobiles, steel and aluminium exports while attracting foreign investment.

The Central American nation faces significant economic headwinds, with the country experiencing 0% growth in March according to the Economic Activity Indicator (IOAE), following a 0.6% contraction in the fourth quarter of 2024, El País reported. Two consecutive negative quarters would constitute a technical recession.

Mexico replaced China in 2023 as the largest US trading partner, with 83% of all Mexican exports directed to its northern neighbour.