Mexican Government, ABM Direct US$500 million to Financing
The Mexican government, the Ministry of Finance and Public Credit (SHCP), the Association of the Banks of Mexico (ABM) and the National Banking and Stock Commission (CNBV) are creating a credit program for SMEs that will channel MX$10 billion (US$500 million) and promote financing.
The objective of the program is to enhance Mexico’s economic reactivation. This is another strategy from the Mexican government and SHCP to help SMEs stabilize after the global crash from the COVID-19 pandemic. Geopolitical conflicts and supply chain shortages continue to affect the Mexican economy as well, especially the smaller companies that have less protection against contingencies.
“We are willing to work more closely with all banks, especially with those that have more interest and vocation in medium and small companies, in the supply chains, to replace an industrial plant that would move from Asia to our country,” said Rogelio Ramírez de la O, Minister of Finance, in a press release by SHCP.
Mexico is also focusing resources on strengthening its infrastructure, said Ramírez de la O. The country plans to allocate MX$630 billion (US$31 billion) to facilitate trade, the movement of goods and connectivity. Mexico is also investing in four train lines, four new airports, over 20 airport modernization projects, 1,625 kilometers of new highways, the modernization of 3,000 kilometers of highway, two new refineries, seven seaport modernization projects and 10 customs.
President Andrés Manuel López Obrador has prioritized investment in the less developed regions of the country since the beginning of his term. These infrastructure projects seek to reduce the inequality gap in the country by investing especially in its southeastern region, said SHCP.
The Ministry deemed the new financing operation vital because the adequate function of the banking sector is a priority for the country’s development. Earlier this year, SHCP issued two bond operations in dollars, which allegedly will reduce the country’s financial pressure by 70 percent by 2023, as reported by MBN.