Mexican government, IDB Seek Economic Reactivation
The Mexican government continues to support SMEs by promoting proper financing strategies and operations. Meanwhile, the Inter-American Development Bank announced that it will step up its efforts to support Latin America’s growth.
Clara achieved its long-awaited expansion to Colombia. The Mexican company had reached a value of US$1 billion in less than eight months, which it is partly using to expand its presence throughout Latin America.
Interbank Interest Rate Hits its Highest Point Since 2001
Mexico’s Central Bank (Banxico) increased the overnight interbank interest rate by 50 basis points to 6.5 percent. The move was announced by Mexican President Andrés Manuel López Obrador before the Bank itself, a move that is in direct violation of article 45 of the Central Bank’s Law. “The Governing Board evaluated the magnitude and diversity of the shocks that have affected inflation and its determinants, as well as the risk that medium and long-term expectations and price formation are contaminated,” reads Banxico’s official press release.
ABM and Mexican Government Direct US$500 million to Financing
The Ministry of Finance and Public Credit (SHCP), the Association of the Banks of Mexico (ABM) and the National Banking and Stock Commission (CNBV) introduced a credit and financing program that will direct MX$10 billion (US$500 million) to SMEs. “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.
UNCTAD Alerts of Decrease in Economic Growth
The Russia-Ukraine war could modify monetary policies in certain countries, as they seek to reduce inflationary pressures and costs. Rebeca Grynspan, Secretary-General, UNCTAD explained that “the economic effects of the Ukraine war will compound the ongoing economic slowdown globally and weaken the recovery from the COVID-19 pandemic.”
Major Uncertainties Hinder Supply Chains
Bain & Company reported that companies learned and evolved from the COVID-19 pandemic, but the unfolding of the Russia-Ukraine conflict in Eastern Europe has caused extreme supply chain disruptions that will affect the world. Supply issues will vary by country and be influenced by the sanctions against Russian oil and gas exports.
BanCoppel Announced US$500 million Investment
BanCoppel will invest MX$10 billion (US$500 million) throughout the next four years in a digital transformation strategy that will comply with the new needs of its market segment. The company will focus its investment on cybersecurity, cloud solutions and more efficient systems, as Carlos López-Moctezuma, CEO, BanCoppel, pointed to the necessity of adapting to a now fully digitized sector.
Inter-American Development Bank (IDB) Focuses on Latin America
Through a series of institutional reforms and a change in its business model, the IDB seeks to tackle poverty, inequality, climate change and the need for digitization. “In 2021, a record year for us, it was shown that the IDB can optimize its balance sheet and mobilize resources; however, the new IDB can achieve even more. We live in a historic moment for the IDB and IDB Invest. The measures adopted by the Assemblies imply that we are gaining the vigor, flexibility and tools that are needed to support the urgent needs of Latin America and the Caribbean in the 21st century,” said Mauricio Claver-Carone, President, IDB.