The Public Finance Secretary (Secretario de Hacienda y Crédito Público / Mexican IRS), Luis Videgaray Caso announced that precautionary measures will have to be taken with regards to public spending in 2017, given the current commodity prices around the world.
Petróleos Mexicanos (Pemex) is one of the many public institutions which will have to make adjustments, the secretary confirmed. In an interview, Videgaray said that this policy is in line with that of Mexico’s Central Bank (Banxico), which said that the fall in oil prices increases the need for Mexico to maintain a solid macroeconomic structure.
“It will be necessary to make certain adjustments to public finances, including Pemex,” said Videgaray.
The statesman added that Banxico suggested taking this action during the central bank’s Feb. 4 policy meeting.
The country needs to use all the available political and economic instruments in order to combat, in an effective and well-coordinated manner, the current market volatility and emerging market aversion that is putting the domestic economy at risk, said Videgaray.
This includes developing a clear and stringent fiscal policy. Much of the responsibility will lie with Pemex, said Videgaray.
The secretary was keen to stress that this policy will only take effect in 2017, noting that the 2016 public finances are protected by the cover provided by the oil sell-off.
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