An optimistic view of the Mexican financial system that doesn’t fairly match with the official information

Andrés López, presidente de México. HENRY ROMERO / REUTERS

Pledge Times | Bhavi Mandalia.

The president of Mexico, Andrés Manuel López Obrador, gave a speech loaded with financial figures and indicators on Tuesday as a part of his second authorities report. Nevertheless, not all the information displays the present scenario, in keeping with economists and consultants consulted. The optimistic imaginative and prescient of the president contrasts with the forecasts of many worldwide organizations, as has been demonstrated as soon as once more throughout his message to the nation. That is an evaluation primarily based on the president’s intervention.

“The autumn within the financial system, regardless of the world catastrophe, was 10.4% within the semester, however even with the debacle the injury brought on by the financial disaster that has effects on us was lower than what’s being recorded in different international locations resembling Italy, Spain, France and the UK ”.

“Right here we’re within the dance of the figures”, says José Ignacio Martínez Cortés of the Laboratory of Commerce, Economic system and Enterprise (LACEN) of the UNAM. “It’s that it can’t be measured by semester, the measurement is quarterly and we’ve the brutal fall of the financial system within the second quarter, the place we had been in full confinement.” Based mostly on the classification of important and non-essential actions as printed within the Official Gazette on March 30, from April 1 to June 30, we’ve in consequence that the financial system falls by 17.9%, in keeping with the data of the Nationwide Institute of Statistics and Geography (Inegi) in relation to the primary quarter of the 12 months. “However we can’t communicate of a semi-annual decline.”

For her half, Valeria Moy, economist and director of the unbiased analysis and evaluation group Instituto Mexicano para la Competitividad (Imco), assures that Mexico has had one of many worst falls in its gross home product (GDP) on this planet. “To say that it isn’t true, that we’ve finished very properly, when we’ve the information that claims in any other case, it’s an outright lie.”

“By not permitting corruption and by making an austere authorities, we’ve been capable of save throughout our Administration round 560,000 million pesos.”

Within the 20 months since López Obrador got here to energy, the Administration has managed to get a few of the massive corporations that evaded the treasury for years to atone for their tax funds and it is a massive a part of the financial savings that he referred to within the report, in keeping with Martínez. Cuts have additionally been made throughout the Authorities, full undersecretariats closed, which have contributed to this austerity. “One thing essential is that this saving, which the Secretary of the Treasury referred to as it saved, it is going to not be repeated. The methods are over, ”says Martínez.

Subsequent Tuesday, the Ministry of Finance and Public Credit score will ship Congress the 2021 Financial Package deal, which is, particularly, the price range it proposes for the Authorities subsequent 12 months. The aforementioned financial savings are anticipated to be spent to spice up the financial system, explains Martínez. In April, responding to strain to implement a bigger financial stimulus program, Treasury Secretary Arturo Herrera mentioned: “Mexico can’t have a fiscal stimulus program the scale of Germany or Canada.”

“115,000 million pesos have been allotted to those packages for the good thing about 9 million folks. It isn’t an expense however an funding; they aren’t items, it’s justice ”.

Given the financial disaster brought on by the coronavirus, the Authorities refused to supply non permanent transfers as earnings to those that misplaced their jobs as a result of confinement measures. In his speech, the president supplied completely different figures of what number of beneficiaries there are from the social help packages that his Administration carried out for the reason that starting of his authorities in 2018. He mentioned, for instance, that “it’s a mark of pleasure to have the ability to say that we assist, for via social packages, 23 million households ”.

“The issue is that you’ll by no means be capable of confirm that, as a result of the figures aren’t clear, so that you have no idea who’s receiving these assets,” says Moy. Social packages are primarily based on the Wellbeing Census, which the federal government has by no means printed or made clear, says the skilled. “That may be very severe. As we speak we’ve none of this info apart from what the president tells us ”.

Overseas direct funding “remained virtually the identical as in 2019” which, throughout the first half of the 12 months, reached 17,969 million {dollars}.

“I consider that what it seeks to current is a political message primarily based on an financial variable, the place what it tries to convey is that the transnational corporations which can be in Mexico belief the nation. That’s the reason you utilize these figures. Nevertheless, right here I’d make a nuance, ”says José Luis de la Cruz, in control of financial affairs of the Confederation of Industrial Chambers (Concamin). “Over the last semester, direct international funding didn’t fall any extra as a result of what was finished was to some extent help from corporations of international mother or father corporations over their subsidiaries which can be in Mexico. They weren’t new investments or reinvestment of earnings, however transfers between corporations of the identical mother or father ”. Continuar leyendo […]

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