Mexico’s Road Investment Decreases by 48% Under López Obrador

Mexico’s total investment in federal road construction and maintenance has decreased by over 48%  during President Andres Manuel López Obrador’s administration compared to the previous administration under Enrique Peña Nieto. 

According to data from López Obrador’s sixth public account, total investment, both public and private, fell by 48% in the first five years of his presidency compared to Peña Nieto’s administration.

Private sector investment in road infrastructure amounted to MX$31.3 billion (US$1.6 billion) during this period, marking a 68% reduction compared to private investment in Peña Nieto's first five years, according to a report by Reforma.

Ricardo Trejo, Director, Forecastim, attributes the decline in private investment largely to the reduced use of public-private partnerships (PPPs). While PPPs were widely utilized during the previous administration, they have seen less support under López Obrador. Trejo noted that the lack of incentives for PPPs has limited private sector involvement. Public investment also dropped by 43.1% with reductions more noticeable in road construction and modernization, reports BNAmericas.

According to the Mexican Chamber of the Construction Industry (CMIC) only one-third of the federal roads network is in good condition. Luis Méndez, President, CMIC, emphasized the importance of road infrastructure, especially in the context of nearshoring and economic development. “Roads play a critical role in ensuring connectivity and quality of life. However, in some states, there has been little to no investment in road maintenance, leaving approximately 80% of the network in poor condition,” Méndez said.

For 2024, the budget allocated for road maintenance is set at MX$4 billion, a significant decrease from previous years when spending reached up to MX$11 billion annually. Méndez estimates that addressing the existing backlog in road repairs would require an estimated MX$20-30 billion per year over the next six years.