Key Developments in Public Spending and Fiscal Performance
According to data released by Mexico’s Secretaría de Hacienda y Crédito Público (SHCP), the government continues to restrict public spending in an effort to contain the deficit and achieve fiscal consolidation for the year.
Public Spending Decline
In the first half of 2025, public spending amounted to 4.57 trillion pesos, marking a 3.8% decrease compared to the same period in the previous year.
Moreover, there was an underspending, meaning less was spent than initially planned. The total underspending reached 286.885 billion pesos.
“Total public spending decreased by 3.8% on an annual basis, aligning with the approved fiscal commitments while demonstrating better results through cost savings in financial expenses,” stated Hacienda.
Fiscal Deficit Reduction
The fiscal deficit, as measured by the Requerimientos Financieros del Sector Público (RFSP), stood at 567,562 million pesos, representing a 32.9% annual drop.
“By the end of June, fiscal balances showed better performance than anticipated in the program. The budgetary deficit was 192,000 million pesos, lower than planned, while the primary surplus was 172 million pesos, exceeding the calendar,” highlighted Hacienda in their communication.
Debt Growth
Regarding the historical balance of RFSP, the debt reached 17.7 trillion pesos by June, marking a 6.8% annual increase.
Government Spending Breakdown
Programmable Spending Cuts
According to Hacienda’s figures, the decline in public spending occurred on the programmable spending side, which is allocated to provide and deliver services to the Mexican population.
Between January and June last year, 3.8 trillion pesos of programmable spending were exercised, a 6% annual decrease and an underspending of 266.804 billion pesos.
In the case of infrastructure investment, crucial for economic development, 399.711 billion pesos were spent, representing a 30.4% decrease compared to the previous year.
Hacienda explained that the significant drop was due to an “atypical” year associated with investment linked to closing the previous administration.
“It’s crucial that comparisons are made based on the specific circumstances of the years being compared. This is not a decrease in investment per se to achieve fiscal consolidation, but rather reflects spending programming that doesn’t pertain only to a single year; it’s a comprehensive spending program for the entire management period under our concern,” said Bertha Gómez, SHCP’s Undersecretary for Expenditures, who led the quarterly press conference in place of Edgar Amador Zamora, SHCP’s head.
Non-Programmable Spending
On the non-programmable spending side, excluding the financial cost of debt, it stood at 775.864 billion pesos, a 2.7% annual increase.
The financial cost of debt was 700.474 billion pesos, a 10.8% annual increase.
