Mexico Deploys US$7 Billion in SDG Bonds for 42 Projects

Mexico’s Finance Ministry (SHCP) released its 2025 Allocation and Impact Report for its Sustainable Development Goals (SDG) Sovereign Bonds, outlining how the federal government deployed US$7.09 billion in sustainable debt. The report expands the categories of eligible spending and, for the first time, includes an assessment aligned with Mexico’s new Sustainable Taxonomy. SHCP emphasized its commitment to financing projects that reduce social and environmental gaps while strengthening investor confidence through verifiable impact reporting.

The 2025 edition covers 42 eligible expenditures supported by past issuances totaling US$7 billion, including projects in clean energy, water management, sustainable cities, education, gender equality, and social inclusion. SHCP confirmed it strengthened its position in global sustainable debt markets in 2024 through two major international issuances—¥152.2 billion in yen-denominated bonds and a €2 billion sustainable bond—along with continued development of the local-currency sustainable yield curve. Of total SDG bond allocations, 55% were in local currency, 30% in euros, and 15% in yen.

SHCP reported that in 2024 it directed US$5.4 billion to states and municipalities with high or very high social marginalization, covering 29 social and 13 green expenditures. Official data show US$1.894 billion went to communities with very high social lag and US$1.853 billion to those with high lag.

Sector Impacts

Education: Mexico allocated US$2.134 billion, funding 327,900 scholarships, infrastructure improvements at 31,000 schools, and the production of 52 million textbooks. Programs for Indigenous students reached 70,973 youth through economic training and 46,011 through housing and food support. The national secondary-school dropout rate fell to 2.9% in 2024.

Water: Water-related projects received US$1.248 billion, benefiting more than 35 million people through improved access, infrastructure, and management. Funds supported the rehabilitation of 59 dams, while safe water access stood at 61.01% of the population.

Energy: US$15 million supported efficiency initiatives that avoided 6.519 GWh of power generation. Renewable energy’s share of national consumption remained at 20.44%.

Health: Health initiatives received US$1.174 billion, supporting services for 3.2 million women using modern contraceptives, 12,365 new antiretroviral therapy patients, and 424,551 adolescents in preventive programs. The national health-access deficit remained at 39.09%.

Transportation & Environment: Transportation projects received US$236 million, financing 76 railway initiatives. Environmental conservation programs received US$154 million, supporting sustainable management of 9.2 million hectares of forest and more than 1,100 natural-resource studies.

Household & Producer Support: A total of 723,404 agricultural producers received assistance; 179,173 forestry subsidies were granted; and 65,998 Indigenous children benefited from school nutrition programs.

In parallel, SHCP renewed its US$24 billion Flexible Credit Line with the International Monetary Fund, describing it as a precautionary tool to bolster reserves and financial stability. The IMF noted that economic activity remains constrained by fiscal consolidation, tight monetary policy, and global trade tensions.

Sustainable Taxonomy Alignment

For the first time, the report includes a technical assessment of how eligible expenditures align with the Mexican Sustainable Taxonomy. According to the analysis, 67.6% of expenditures were classified as “not aligned,” 8.1% as “eligible,” 22.5% as “partially aligned,” and 1.8% as “fully aligned.” SHCP said the inclusion of this assessment reflects progress in transparency, though results highlight the need to strengthen technical consistency across government programs.

The ministry emphasized that the report adheres to the highest international disclosure standards, citing compliance with International Capital Market Association (ICMA) principles. The United Nations Development Programme provided nonbinding review to support credibility and interministerial coordination.