The public money that is expected to be allocated next year for the development of infrastructure , such as highways, communication routes, ports and airports, points to a record amount, not seen since 2012.
The 2023 economic package contemplates spending on physical investment of 1,101 billion pesos, which represents the highest amount recorded since 2012, which is the last comparable data, due to changes in the accounting rules of public investment, explained the secretary of Hacienda Rogelio Ramírez de la O, in his appearance in the Chamber of Deputies last week.
What will it be spent on?
This money will go mainly to the construction of the Mayan Train and the development of the Isthmus of Tehuantepec. Hydraulic projects such as Agua Saludable para la Laguna, the Santa María dam, the extension of the irrigation district of the Yaqui people, the Zapotillo dam and the El Cuchillo 2 aqueduct.
Also to road and connectivity projects, such as the construction of the Mexico-Toluca train, the connection of the eastern zone of the Valley of Mexico, the Mitla-Tehuantepec, Barranca Larga-Ventanilla, Real del Monte-Huasca and Portezuelo-Ciudad Valles highways, as well as the construction of rural roads, labor in Guerrero, Oaxaca and Sonora, among others.
In the energy sector are the rehabilitation of refineries and hydrocarbon exploration and production projects, as well as connectivity, through the installation of towers and antennas for cellular network coverage for CFE Telecomunicaciones and Internet para Todos.
It may be better
“By 2023 we see a significant amount for investment; however, we believe that it could have been improved, especially the quality of the investment destination, Mexico needs a lot of support in infrastructure to promote Mexican and foreign private investors, it is not enough, especially the destination that is being assigned for 2023 ” , commented Alejandro Hernández, president of the Mexican Institute of Finance Executives (IMEF).
He stressed that public investment is key to economic reactivation and attracting private investment from Mexican and foreign companies.
An analysis by the Center for Economic and Budgetary Research (CIEP) details that investment spending would be 15.6% higher than that approved in 2022, although 9.5% lower than in 2021.
The proposed investment spending represents 3.8% of GDP and 14.3% of total spending. It is less than the 4% of GDP recommended by the Economic Commission for Latin America and the Caribbean (ECLAC) for the achievement of the sustainable development objectives, highlights the CIEP.
“In order to have a greater impact on the economy, human development and the closing of gender gaps, the increase in public investment must be accompanied by a strengthening of public revenues and provide fiscal sustainability to the resources allocated to public works. ”, details the document Implications of the Economic Package 2023, of the CIEP.
so goes 2022
According to the Ministry of Finance and Public Credit (SHCP), for this year 863.175 million pesos were approved for physical investment. Until the end of August, 531,626 million pesos had been exercised, which corresponds to 62% of everything programmed.
“Although it is true that there was investment, we believe that the destination could be greatly improved, it is highly concentrated in projects that do not have a return as expected, and above all that can motivate investment from the private sector,” said Hernández.
Jessica Roldán, vice president of the IMEF Indicator Technical Advisory Committee, considered that there is a positive factor for investment due to the recomposition of supply chains that came with the pandemic, but this must be reinforced with security and clear rules.
“We have to think of public investment as a trigger and a virtuous circle, also for private investment, as long as the bad environment for investment, and insecurity in terms of contracts, are not resolved in a more forceful way, we will not be able to see the effect or virtuous circle”, said Roldán.