The Week in Infrastructure: Banks Spare No Expense in Infrastructure

At a press conference the Mexican Banking Association (ABM) led by its President Luis Niño de Rivera stated that Mexican banks had over US$30 billion ready to make available for investments in Mexico’s infrastructure through collaborations with the country’s private sector. 

Niño de Rivera explained that the banking sector’s strategy to promote economic growth is anchored in three pillars: exports, consumption and infrastructure investment. The first two categories appear to present a positive outlook but when it comes to reaching this administration’s 4 percent growth objective, the third category must be addressed directly.

The ABM president also made it clear that while investment in physical infrastructure is indispensable, a considerable percentage of these resources must be spent in Mexico’s intangible infrastructure, such as the availability of legal services that guarantee civil rights. 

Government and Private Sector Present First Batch of Infrastructure Projects

147 projects representing over US$44 billion of total investments compose the first package of infrastructure projects presented by the government and the private sector as part of the National Infrastructure Plan. By the end of 2020, 72 projects are expected to be finished.     

CCE President Carlos Salazar Lomelín was present during the announcement and highlighted the importance of aligning the administration’s development priorities with private companies’ investment plans.

Moody’s Endorses National Infrastructure Plan Without Changing Rating

After analyzing the specifics of the National Infrastructure Plan published this week, international rating agency Moody’s has expressed a positive opinion regarding its potential, particularly when it comes to boosting local economic growth through short-term investments between the current administration and the private sector.

However, the possibility that this optimism might translate into an upward grade in Moody’s current credit rating and growth forecasts for Mexico was denied by representatives from the agency. Security issues are some of the elements cited that are working against the possibility of achieving a higher credit rating.  

INFONAVIT to Participate in National Housing Program 

50,000 “solidarity credits” will be issued by INFONAVIT as part of its cooperation with the recently announced National Housing Program. Another prominent goal will be the recovery of 171,000 housing units from their current state of abandonment.

Other INFONAVIT initiatives and programs are also scheduled to continue, such as the “90 10” initiative that cancels the remaining debt of applicants who have paid over 90 percent of their housing credit. 

Infrastructure Spending Insufficient: Engineers 

During the 30th National Congress of Civil Engineering, Ausencio Medina Nieves, President of Mexico’s College of Civil Engineers, stated that the US$44 billion spending in infrastructure only represents 0.7 percent of Mexico’s GDP and might prove insufficient to promote the necessary economic growth.

(image courtesy of Eric Lugo from https://www.eleconomista.com.mx/ )