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‘HISTORIC’: HOW MEXICO’S WELFARE POLICIES HELPED 13.4 MILLION
PEOPLE OUT OF POVERTY  
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Oscar Lopez
August 18, 2025
The Guardian
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_ Experts are enthusiastic about poverty reductions achieved under
former Mexican president Andrés Manuel López Obrador _

A boy stands at a corner as his sister walks inside their house in
Zitlaltepec., REUTERS/Edgard Garrido

 

Toothless and frail, Gloria Palacios, 84, stooped as she set up her
rickety sidewalk shop in Mexico
[[link removed]] City’s roughshod
Doctores neighborhood. On sale: peanuts, cigarettes, chewing gum,
chocolates and chips.

When asked how much she made in a day, Palacios’s disabled son
Gustavo, who helps run the tiny store, simply laughed. “If we make
100 pesos ($5) it’s a lot,” he said. Happily, said Palacios, the
family has a different lifeline.

With their house crumbling and bills piling up, the only thing keeping
them afloat is a bimonthly transfer of 6,200 pesos ($330) implemented
by the government of previous president Andrés Manuel López Obrador
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adults over 65.

“God bless López Obrador,” said Palacios. “Without him what
would we do? I think we wouldn’t even have enough to eat.”

Palacios is one of millions of people across Mexico who have benefited
from the welfare policies of López Obrador, or Amlo as he’s
commonly known. And now, thanks to a report released last week by the
country’s national statistics agency, we know just how effective
those policies were.

When Amlo took office in 2018, there were nearly 52 million people
living below the poverty line: by the time he left office six years
later, that number had dropped by 13.4 million, a decrease of almost
26%. Extreme poverty also dropped from nearly 9 million people to just
7 million.

In a country that has long suffered from deep inequality and struggled
with economic precarity, the steep drop in the number of people living
in poverty is a remarkable achievement and suggests Amlo’s policies
had a measurable impact on the lives of millions of everyday Mexicans.

“It’s something extraordinary, historic, the reduction [of
poverty],” said Amlo’s successor and ally Claudia Sheinbaum
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conference on Thursday. “‘For the good of all – first the
poor’ is not just a slogan, but a reality in Mexico.”

Some independent Mexican analysts have been equally enthusiastic about
the poverty reductions achieved under Amlo.

[a man in a suit waving to a crowd of people ]

Andrés Manuel López Obrador salutes attendants after his victory in
the elections for the presidency of Mexico on 1 July 2018 in Mexico
City. Photograph: Manuel Velasquez/Getty Images

“There has never been a single six-year term in which poverty has
been reduced or decreased so significantly,” said Viri Ríos, a
public policy expert and director of Mexico Decoded.
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the Mexican economy.”

Amlo was elected in a 2018 landslide with a promise to eradicate
corruption and tackle inequality
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Among the legacies of his administration were the tripling of the
minimum wage from 88.40 pesos ($4.75) per day when he took office to
the current rate of 278.80 pesos ($15) a day.

This had a knock-on effect on other sectors of the economy, according
to Valeria Moy, a Mexican economist and director general of IMCO, a
public policy thinktank.

“When the minimum wage increases, other wages and incomes in the
economy begin to rise – even in the informal economy – because
there is a greater availability of resources,” she said. “I
don’t know if the [poverty reduction] was purely because of López
Obrador’s policies, but I do think the push in the minimum wage
moved the rest.”

Ríos was more emphatic.

“We’re talking about a labor market that had a minimum wage well
below the standard of living,” she said. “And now it’s reached a
level that allows 13.4 million families to escape poverty. It’s a
historic achievement.”

Amlo also transformed the social welfare system, implementing a system
of cash transfers for elderly people, like Palacios, for young people
doing apprenticeships and for farmers planting fruit trees, among
others. He then doubled the amount spent on these transfers.

The universal cash transfer system, which replaced a well-regarded
conditional system for the poorest fifth of households requiring
children to go to school and families to attend health check-ups, has
received some criticism as it meant that, in the case of the pension
system for example, anyone, even well-off Mexicans over 65, were
entitled to a transfer.

“We lost focus and lost the ability to give to the poorest,” said
Gonzalo Hernández Licona, the former head of the National Council for
the Evaluation of Social Development Policy (CONEVAL), a now defunct
agency which used to measure poverty before the task was transferred
to the statistics institute. “While the amount has grown, the way
the amount is distributed has worsened.”

This might help explain why the 19% reduction in extreme poverty was
much lower than the nearly 26% reduction in overall poverty. Many of
the poorest Mexicans live in remote rural places, where accessing
social welfare is hard if not impossible.

“The big problem [with the cash transfers] is not that they’re
universal,” said Ríos. “The big problem is that the Mexican
government has not made an effort to make it truly universal – that
is, to make it reach everyone.”

Meanwhile, the report from the statistics agency also revealed other
glaring issues under Amlo’s government: while access to food
security, social security and dignified living conditions all
increased, the number of people without access to health services more
than doubled, from 20.1 million people in 2018 to more than 44 million
in 2024.

“I think the great debt that the Mexican state still owes its people
is improving access to healthcare,” said Ríos. “As a percentage
of GDP, our spending on health is similar to countries in sub-Saharan
Africa.”

Palacios, who has considerable medical expenses but no access to
medical insurance said she felt “horrible”.

“Medicines are so expensive,” she said. “And I don’t have
anything.”

Sheinbaum admitted there was still more work to do.

“Do we still have progress to make? Yes,” she said. “With 30% of
Mexico’s population living in poverty, we obviously have to keep
moving forward.”

_Oscar Lopez is a freelance journalist based in Mexico_

* Mexico
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* War on Poverty
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