Image credits: Gobierno de México
News Article

IMF Resources to Pay Mexico's Debt / Mexico-US Border Closure

By Paloma Duran | Tue, 08/24/2021 - 11:02

Fire on the PEMEX platform. Director of PEMEX Octavio Romero announced that the fire that occurred on Sunday at the E-Ku A2 platform of the Ku-A Processing Center in Campeche left five people dead, six injured and two missing. “The unfortunate death of five people was reported; one of them was a worker from PEMEX and four from COTEMAR. The two missing are from the Firm for the Monitoring of Conditions and Integrity. We are still looking for them.” Romero said the fire was not caused by equipment failures or lack of maintenance and highlighted its causes are still being investigated.

On Sunday, workers were performing routine maintenance at a power generation and compression facility when the fire broke out at 3:10 p.m. Authorities were able to control the fire by 4:30 p.m. In addition, PEMEX has been severely affected as around 420,000 barrels of daily oil production have remained offline.

Third wave of COVID-19 in decline. Deputy Minister of Health Hugo López-Gatell highlighted that the country has had three consecutive weeks with a decrease in COVID-19 cases, which suggests the decline of the third wave in the country. “There are 17 entities that have shown a significant reduction in cases. However, as long as the epidemic exists in one part of the world, preventive measures should be maintained and people should be vaccinated, as it is the best way to prevent serious illness and death. "

According to the Ministry of Health, the third wave of COVID-19 registered a reduction of 10 percent this week, after a 12-week increase in infections. The authorities explained that the third wave reached its peak last week when 124,651 cases were registered. Currently, there are 111,000 positive cases in the country.

López-Gatell: The risk of dying from COVDI-19 is almost nil in children. López-Gatell stressed that the risk of a minor having a serious illness or dying from COVID-19 is almost nil. However, he stressed that children with any disease or immunodeficiency should be even more careful. "Minors, neither in Mexico nor in the world, have proven to be a population at risk. It is clearly seen that below the age of 18 the risk of dying from COVID-19 is almost nil."

Health authorities have ensured that children are not affected by COVID-19 like adults. However, since the start of the pandemic, 194,876 children have been infected in Mexico, of which 8,491 have had serious complications.

Mexico-US border. Minister of Foreign Relations Marcelo Ebrard assured that the crossing restrictions on the Mexico-US border would not continue until 2022. “The main factor behind the closure of the border was the increase in infections in both countries. We do not expect the current circumstance to last until 2022, as it would affect most of the activities on the border.”

 The US has announced that it will extend restrictions on non-essential travel until Aug. 21. Mexican and US authorities have ensured that the flow of essential travel and trade will not be affected. However, due to the volatility of the pandemic and the increase in COVID-19 contagions due to the delta variant, the opening of the border may be postponed.

 Mexico to pay external debt with IMF resources. President Andrés Manuel López Obrador announced that the government is already making arrangements with the Bank of Mexico so that the resources of the International Monetary Fund (IMF) are used to pay the country’s foreign debt. “We are going to save a lot of money because there will be a decrease in the payment of the debt and its interest, which helps the Ministry of Finance."

The IMF announced that it will allocate US$620 billion in Special Drawing Rights (SDR) to member countries, for which Mexico will receive US$12 billion. Banxico announced that part of the country's debt could be paid with the new resources but that the government needs to buy the bank's assets. However, according to the economic adviser to AmCham Mexico, Luis Foncerrada, the government would not achieve significant savings since the Ministry of Finance would have to issue bonds to buy the dollars from the bank.

The data used in this article was sourced from:  
Gobierno de México, Milenio
Photo by:   Gobierno de México
Paloma Duran Paloma Duran Junior Journalist and Industry Analyst