Mexico’s World Cup Prep Stalls as Infrastructure Spending Drops

Mexico City, Mexico — With one year remaining until the 2026 FIFA World Cup, co-hosted by Mexico, the United States, and Canada, Mexico has sidelined one of its key economic players: infrastructure investment. Federal spending on physical infrastructure plummeted by 19% in the first four months of 2025, marking the steepest decline since January-April 2019, when it fell by 16.8%, according to data from Mexico’s Ministry of Finance and Public Credit (SHCP).

A Missed Opportunity for Development

The drop follows a 27.6% increase in infrastructure investment during the same period in 2024. Analysts attribute the decline to the outgoing administration of President Andrés Manuel López Obrador accelerating spending to complete flagship projects, while the incoming government of Claudia Sheinbaum focuses on tendering new infrastructure initiatives and fiscal consolidation.

"A decline in physical investment is never good news, but there’s a mitigating factor here," said Tamón Takahashi, chief economist at TKA Analytica. "Last year was an election year, and there was pressure to finish projects like the Tren Maya and the Dos Bocas refinery, which received massive funding. Typically, the first quarters are slower—except in election years."

Historical Underinvestment Persists

Mexico’s infrastructure spending has historically been low, never exceeding 4.5% of GDP, a peak last reached in 2014. In 2024, it closed at 3.0%, slightly up from 2.8% in 2023. Iván Benumea, Fiscal Justice Coordinator at Fundar, noted that while Sheinbaum’s government is planning major infrastructure projects—including rail and energy developments by state utility CFE—many are still in the bidding phase.

"Public investment may increase significantly in the coming months," Benumea said. "But we shouldn’t forget that Mexico’s public investment has been chronically insufficient."

World Cup Exposes Infrastructure Gaps

Global sporting events like the World Cup typically spur infrastructure development, benefiting host cities with improved logistics, transportation, and tourism facilities. However, Mexico risks falling behind, leaving its cities ill-prepared for the influx of visitors.

"If people see good infrastructure—or efforts to build it—that’s always a positive indicator," Takahashi added. "It shows there’s money, planning, and legal security. The opposite sends a very bad signal about the economy."

Oscar Ocampo, Director of Economic Development at the Mexican Institute for Competitiveness (IMCO), warned that the investment slump is particularly concerning amid economic slowdowns and existing bottlenecks in logistics and energy.

"Quality investment should be a key performance indicator for the federal government," Ocampo said. "This decline, driven by fiscal consolidation, has serious implications for Mexico’s growth prospects this year."

Pressure on Local Governments

With reduced federal funding, analysts predict that state and municipal governments—particularly in host cities Mexico City, Monterrey, and Guadalajara—will intensify efforts to raise local revenue through property taxes, vehicle levies, and traffic fines. However, these measures may not offset the federal shortfall.

"States are in a tight spot with growing needs in every sector," said Jesús Carrillo, an economic analyst. "Addressing an exceptional event like the World Cup will be difficult. Mexico City might have the best chance, as it’s the most financially independent from the federal government."

Long-Term Consequences

Beyond the World Cup, experts warn that underinvestment in infrastructure—including roads, public transport, hospitals, and cultural facilities—will leave Mexico struggling to meet future demands.

"We need more than just highways," Benumea emphasized. "Investments in public transport, hospitals, and sustainable projects are crucial for long-term development."

As the countdown to the 2026 World Cup continues, Mexico faces a critical test: whether it can leverage the global spotlight to address its infrastructure deficit—or risk falling further behind.