Environmental damage and drying-up of resources such as water and minerals are costing Mexico nearly 90 billion U.S. dollars annually, equal to almost 8 percent of its GDP, according to a new report.

Among the total, air contamination represents 4.4 percent of the GDP, while rapid extraction of the country's proven oil and gas reserves account for 1.5 percent of the GDP, and exploitation of rapidly-shrinking aquifers and deforestation eat away another 0.5 percent of its GDP, according to report issued by the National Statistics and Geography Institute (INEGI).

Mexico, the world's seventh-largest petroleum producer, has undergone sharp decline in both oil output and proven reserves over the past five years.

Deforestation was deteriorating with increased number of wild fires and illegal logging for commercial and agricultural interests, INEGI said.