The Secretary of Finance and Public Credit of the Government of Mexico, Rogelio Ramírez de la O, admitted this Tuesday that the fiscal support to the state Mexican oil (Pemex) will continue “for years“because your debt is”very big”.
“You cannot hide the sun with a finger, it is a very large company that has been restructuring for 6 years (…) but it is a restructuring that will take years, because it is a very large debt and it is a very large company“, he indicated in his participation in the ‘National Meeting of Regional Directors (RNCR) 2024’ of BBVA.
The Mexican Government official acknowledged that controlling Pemex’s debt has taken the six years of President Andrés Manuel López Obrador’s administration (2018-2024).
He said that the learning during this six-year term concluded that the next step to boost the most indebted oil company in the world “comes from the need to focus more on debt refinancing” from the finances of the Mexican Government.
Ramírez de la O recalled that starting in 2024 the Government designated 170,000 million pesos (about US$ 10,000 million) in the budget to amortize short-term debts that were due during the year.
“Pemex already has a line of expenditure for the purpose of paying amortizations, so this is the beginning of an optimization, that is, in the sense that the balance of the federal government will be more dedicated to meeting the needs of Pemex”, he highlighted.
Furthermore, he foresaw that both Pemex and the Mexican Government will evaluate the opportunities in a coordinated manner “to reduce costs, maintain authority and be much more effective in investments.”
“In short, it is an agenda that will take much more concrete form in the next stage of this structure, but it is a restructuring that will take years, because it is a very large debt and it is a very large company.”he remarked.
The government of Lopez Obrador has transferred 952,000 million pesos (about US$ 56,000 million) directly to Pemex from 2019 to 2024, as reported last Friday by the director of the State oil company, Octavio Romero Oropeza.
Most of the amount, 561,000 million pesos (almost US$33,000 million) has been allocated to paying debt, while 391,000 million pesos (about US$23,000 million) have been for infrastructure, and the rest for various items.
Among other measures, the Mexican Government has promoted the reduction of its shared utility tax (DUC) from 65% to 30%, while it has forgiven tax contributions for the extraction and exploitation of hydrocarbons.
Source: Gestion
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