(Bloomberg) -- Grupo Financiero Banorte has more than doubled its growth forecast for Mexico next year, saying U.S. demand, record remittances, and a quick reopening have boosted activity more than expected.Banorte, Mexico’s second-biggest lender, published new estimates that came closer to the finance ministry’s September projection of 4.6% growth in 2021 -- at the time criticized by analysts as being “overly optimistic.” Mexico’s Deputy Finance Minister Gabriel Yorio said he expects more private sector analysts to follow Banorte’s revision, which put 2021 growth at 4.1%, up from an earlier 1.8% projection.“We can expect revisions showing better performance,” Yorio told Bloomberg by text, adding that gross domestic product is on track to meet the government’s predictions.Economic activity data “seem to show much better third-quarter growth than the market expected,” Yorio said, pointing to data published Wednesday showing that economic activity for September is expected to be 6.9% lower than in the previous year, up from a drop of 7.9% in August.Banorte sees manufacturing as “one of the sparks of growth once we were able to reopen the economy and reconnect to the global supply chain,” Gabriel Casillas, the bank’s chief economist, said in a phone interview.The economy will shrink 9% this year, Banorte projected, an improvement from its earlier estimate of a 9.8% fall. Expectations that a vaccine will be distributed in the second half of next year added to the pickup. A change to Banorte’s modeling also accounted for the higher projection, Casillas said.The outlook is far from cheery, however. Mexico’s total activity in 2021 will still be 5.5% lower than in 2018, Banorte expects.“Even though 4.1% sounds optimistic, it’s still not optimistic vis-a-vis what we saw in previous recessions and vis-a-vis what’s going to happen, or what’s expected to happen, in other countries,” Casillas said, noting that in the year after Mexico’s past two economic crises, gross domestic product recovered by the same amount or more than it contracted during the recession.Mexico is set to fare worse than other countries because of the government’s “extremely limited” spending to combat the slump, Casillas said. President Andres Manuel Lopez Obrador has refused to borrow more money to fund a stimulus, arguing that taking on more debt would burden Mexico’s recovery.Earlier this month, the IMF struck a gloomy tone, despite boosting its 2020 projection to a 9% contraction from a 10.5% slump, and its 2021 estimate to growth of 3.5%, 0.2 points higher than it predicted earlier.“Employment, income, and poverty will take several years to return to pre-pandemic levels,” the IMF said. “Not only are the gains of the past decade in these areas being set back, Mexico’s long-standing challenge of low growth appears set to worsen.”A victory for U.S. presidential candidate Joe Biden would help Mexico by calming global trade tensions, Banorte said, allowing America’s southern neighbor to benefit from the USMCA trade deal at China’s cost.(Updates to add Yorio comments in second, third, fourth paragraphs; economic activity data in third)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.