The Ministry of Finance and Public Credit (SHCP) lowered its estimate for debt, in its broadest measure, for the end of this year, in accordance with the projections in the Annual Financing Plan for 2022.
By the end of 2021, the agency foresees that the Historical Balance of the Financial Requirements of the Public Sector (SHRFSP), will be located at 50.3% of the Gross Domestic Product (GDP).
This new estimate is lower than the one forecast in the ninth month of the year, when the agency, led by Rogelio Ramírez de la O, delivered the Economic Package for 2022 with a SHRFSP of 51% of GDP.
“By the end of 2021, the SHRFSP is estimated to be close to 13 billion pesos, at a level of 50.3% of GDP, and a stable trajectory is expected for the next few years. The pandemic associated with the disease called Covid-19 generated a change in the debt trajectory, however, it remains sustainable in the medium term, ”the agency highlighted.
He added that the main component of the SHRFSP is the federal government debt, which is estimated to represent 80% at the end of this year, that is, 8.3 trillion pesos of the internal debt and 116.9 billion dollars for the external debt. .
He recalled that, according to the law, the federal government has the obligation to maintain the debt, as a percentage of GDP, at a level that does not put the solvency of the public sector at risk.
In this sense, he pointed out that the SHRFSP level is sustainable, even considering adverse shocks.
Last year, the effects of the health and economic crisis caused by the Covid-19 pandemic led to the debt growing significantly and even reaching historic levels.
At the end of 2020, the SHRFSP stood at 52.4% of GDP, the highest level recorded for the end of any year.
Six-year term would close with 44.9%
The projections of the Annual Financing Plan also launch the outlook expected by the agency for the following years, in which the debt is expected to continue to decline.
The expectation of the Treasury is that the following year, with a growth of 4.1% of GDP, the debt will fall to 47.1% of GDP. This level would continue to decline until reaching 44.9% in 2024, that is, at the end of the Andrés Manuel López Obrador administration.
In this way, the López Obrador administration would close its six-year term with a debt at the same level as Enrique Peña Nieto left it in 2018.
Auctions announced for 2022
The Ministry of Finance also published the government securities placement program, corresponding to the first quarter of 2022.
This program will be in force as of January 4, and Cetes, Bondes F, Bonds M and Udibonos will be auctioned.
“The public debt policy of the Government of Mexico will continue to be guided by a proactive and flexible strategy during the first quarter of 2022, seeking to satisfy financing needs preferably in the local market and will adjust to the public deficit goal in order to continue to strengthen the macroeconomic fundamentals and public finances of the country ”, stated the Secretary of Finance.
Reference-www.eleconomista.com.mx