The subnational debt in Mexico increased 89 percent in the last 15 years, mainly due to the financial crisis that hit the country between 2008 and 2012, reported the Mexican Institute for Competitiveness (Imco).
According to the report Let’s Talk about Debt 2023, the payment obligations or liabilities assumed by governments or state and municipal entities were affected by the decrease in economic growth and federal income, which decreased the participations, which are the main source revenue for subnational governments.
Recommended for you: Budget of the Judiciary 2024 should not jeopardize the administration of justice: STPJF
“In addition to the need for financing to cover these deficits, the sources of financing were diversified, including bank loans and stock financing,” the Imco report indicates.
However, it points out that between 2012 and 2022, the growth of the subnational public debt remained stable, with an increase of 0.3 percent to reach a balance of 684 thousand 396 million pesos at the end of last year.
According to the Imco, the figure represents a reduction of 4.8 percent in real terms compared to 2021.
“Only San Luis Potosí, Baja California Sur, Yucatán, Nuevo León and the State of Mexico increased their debt, while 26 federal entities reduced it,” the report highlighted.
He added that in terms of per capita debt, Nuevo León was the entity with the highest amount for 17 thousand 223.3 pesos per inhabitant, at the end of 2022; followed by Chihuahua with 13 thousand 203.2 pesos; Quintana Roo with 13 thousand 185.1 pesos; Coahuila with 12 thousand 50.3 pesos, and Mexico City with 10 thousand 998.3 pesos.
The agency highlighted that, according to the Organization for Economic Cooperation and Development (OECD), Mexico’s subnational debt is the second lowest among the most advanced economies, representing just 2.5 percent of national GDP.
➡️ Subscribe to our Newsletter and receive the most relevant notes in your email
Of the total subnational debt, most corresponds to the financial commitments of state governments, with 87.8 percent of the total, followed by the debt of state public entities and municipalities, with 6.3 and 5.5 percent, respectively.
Similarly, the Imco pointed out that the main creditor of local governments and instances is commercial banks, with approximately 54 percent of the total debt, equivalent to 367 thousand 723 million pesos.
2023-08-23 11:00:00
#State #debt #increases #Sol #México
