Environmental Protection Spending Plunges in Early 2025

Public spending on environmental protection saw a sharp decline in the first two months of the year, according to Mexico’s Ministry of Finance and Public Credit (SHCP). The reduction is mostly driven by major cuts to CONAGUA and it comes within a broader fiscal adjustment aimed at reducing the public deficit. 

Between January and February, the government allocated MX$1.2 billion (US$63.6 million) to the environmental sector, representing a year-on-year reduction of 49.4%. This is the largest drop recorded since 2007, as reported by SHCP. 

The reduction in environmental protection spending was mainly due to a cut in funding for CONAGUA, which received just MX$2.1 billion during this period, an 82% decrease from 2024. However, Jorge Cano, Coordinator of the Public Spending and Accountability Program, México Evalúa, explained that this drop in spending is not unusual. He noted that in 2023, the government temporarily increased funding for water management and infrastructure projects to protect key areas. In contrast, this year’s lower spending simply reflects a return to typical levels seen during the previous administration. “What has been spent this year aligns with the average for the first two months of the past six-year term,” he said.

This contraction in the sector’s budget also coincides with the fiscal adjustment approved by the government, aimed at reducing the public spending deficit, from 5.7% to 3.9% of GDP, while expecting higher tax revenues. Additionally, Iván Benumea, Coordinator of the Fiscal Justice Program, Fundar, explained that environmental protection has historically been a low priority for the Mexican government. In fact, spending in this area, which represents just 0.26% of total programmable expenditure, will face a total cut of 5.6%, compared to last year. 

On the other hand, Benumea pointed out that SEMARNAT appears to be underutilizing its approved budget. Although around MX$3.2 billion was allocated for the first two months of 2025, the ministry spent only MX$2.9 billion, 9.3% less than what was available, highlighting a case of budget under-execution rather than a lack of resources.

The 2025 budget approved for Environment and Natural Resources is just over MX$44.3 billion, a 36.9% reduction compared to MX$70.2 billion in 2024. Specifically, the Federal Attorney for Environmental Protection (PROFEPA) and the National Institute of Ecology and Climate Change saw a 10% budget cut each. Similarly, the National Agency for Industrial Safety and Environmental Protection in the Hydrocarbon Sector and the National Forestry Commission (CONAFOR) face reductions of 10% and 6.5%, respectively. Furthermore, the Directorate-General for Climate Action Policies also experienced a 7% decrease.