Background on Édgar Amador Zamora and His Role
Édgar Amador Zamora, the Secretary of Finance and Public Credit (SHCP) in Mexico, recently addressed the Chamber of Deputies regarding the country’s fiscal situation. His role as the head of SHCP places him at the forefront of managing Mexico’s public finances, making his statements significant for understanding the nation’s economic policies.
Fiscal Consolidation and Deficit Adjustments
Amador Zamora reported that Mexico has successfully transitioned to a sustainable and solid fiscal consolidation, despite an upward revision of the fiscal deficit projection for this year. The Requerimientos Financieros del Sector Público (RFSP) are expected to close at 4.3% of the Gross Domestic Product (GDP) this year, which is higher than the initially approved target of 3.9%.
He emphasized that responsible management of public debts has stabilized Mexico’s debt at healthy and sustainable levels, presenting a favorable comparison with countries of similar economic standing.
Maintaining Financial Health and Social Welfare
Amador Zamora highlighted that maintaining sound public finances allows for a minimum level of well-being for the Mexican population. He underscored that financial discipline has been a key virtue of the second pillar of Mexico’s Fourth Transformation, ensuring the stability of public finances.
He added that ensuring a minimum level of well-being for the population can coexist with sound public finances, and that fostering economic development is not exclusive of a responsible fiscal policy but rather a condition and outcome of it.
Future Fiscal Plans
For the upcoming year, the government proposes a total public expenditure of 10.1 trillion pesos, marking a 5.9% increase compared to this year’s approved amount. This expenditure will be funded through public revenues of 8.7 trillion pesos, along with an internal borrowing ceiling of 1.78 trillion pesos and an external borrowing limit of 15.5 billion US dollars.
Adjustments in Taxation and Trade
Although no major fiscal reform is being proposed, a Miscellaneous Fiscal bill is planned for the next year. This bill includes updates to the “healthy taxes” quotas and an 8% import tax on violent video games. Additionally, proposed changes in international trade aim to boost tax revenues.
Key Questions and Answers
- What is the current fiscal deficit projection for Mexico? The Requerimientos Financieros del Sector Público (RFSP) are expected to close at 4.3% of the Gross Domestic Product (GDP) this year.
- How has Mexico managed its public debt? Responsible management of public debts has stabilized Mexico’s debt at healthy and sustainable levels, presenting a favorable comparison with countries of similar economic standing.
- What are the future fiscal plans for Mexico? The government proposes a total public expenditure of 10.1 trillion pesos for the upcoming year, funded by public revenues of 8.7 trillion pesos, internal borrowing ceiling of 1.78 trillion pesos, and external borrowing limit of 15.5 billion US dollars.
- Are there any taxation or trade adjustments planned? Although no major fiscal reform is being proposed, a Miscellaneous Fiscal bill includes updates to “healthy taxes” quotas and an 8% import tax on violent video games. Proposed changes in international trade aim to boost tax revenues.
