Not all is bad news for Mexico during the economic crisis triggered by the coronavirus pandemic. According to the Mexican Secretary of Finance, Arturo Herrera, the export sector has seen a good recovery and the growth potential is even greater. “We know that industrial activity, according to the latest figure, which is that of November, is already approaching the levels of December 2019 and the one that is performing the best is the export sector, even better than in 2019,” he said Herrera during an intervention via videoconference in an event of the credit rating agency Fitch Ratings. “These are promising figures, but of course the country is not recovering in a homogeneous way,” he added.
Services related to the tourism sector have fallen 45% in their activity, Herrera reported, a drop that persists today and will not be reversed until the vaccination program is complete. Of the 12 million jobs lost in both the formal and informal sectors, 9.6 million have been recovered. “It’s good, but we have three million more jobs to create”, during his speech, just over 30 minutes.
On the arrival of the new federal government in the United States, led by President Joe Biden, Herrera said he hopes to see a return to multilateral coordination. For Mexico “the performance of the US economy is very important, the economic cycles of both countries are highly correlated,” Herrera said. “Before the covid, we signed the new trade agreement with the US and Canada and, due to the pandemic, it has not been used to its full potential and this is something we are hoping to take advantage of in the coming months.”
“Also, with the new administration coming in, the expectation is that some of the bigger international issues will change the way they are approached. The previous administration preferred bilateral talks, sometimes complicated, and now we hope that the Biden administration will give preference to multilateral agreements and groups like the G20 and that will probably make room for a lot of things that have been on hiatus in recent years, ”added the official.
Herrera described that “so far, we are doing well” in terms of the vaccination plan. The country’s initial strategy was to agree with three different pharmaceutical companies, as well as with an initiative led by the United Nations, in order to hedge the bets of which agreement would bear fruit the earliest. He also said that medical personnel are expected to be vaccinated in the next two weeks, and then continue with the vaccination of the 12 million Mexicans who are over 65 years of age and 15 million over 60. “One thing that we have clearly Detailed in our plan is that we will go to the rural areas at the same time as we will go to the cities and, in fact, right now we are having a kind of rehearsal of this. “
Shelly Shetty, Fitch’s senior sovereign debt analyst for Latin America, asked about the possibility of Mexico passing a tax reform during the second half of the administration of President Andrés Manuel López Obrador. Herrera did not respond to me directly: “I am hopeful because I have spoken with people in Congress and with various political actors and there is a feeling that something has to be done. The Covid has been a very big scare, and everyone understands that we need to have a more resistant country and a stronger tax system that can provide the resources for next year and in the future. “
Finally, on the issue of the finances of the parastatal company Petróleos Mexicanos, the world’s most indebted oil company, Herrera assured that it does “take away sleep” but that they are working every day to reduce their debt levels. “We are working with them every day,” said the secretary. “People in Mexico are very passionate about two things in Mexico, one is soccer and the other is Pemex, everyone has an opinion. But when you look at the numbers coldly, your gross pre-tax result is better than many of your competitors. The problem begins when we begin to collect the taxes that we charge him and at the same time he has to pay his debt. “
“What we have been doing in recent years is reducing Pemex’s tax structure, so that they can be adjusted little by little and give us room to breathe,” said Herrera.