Friday, July 18, 2025

Transfers to inefficient state companies hurt health, education: economist

Government transfers to two inefficient state-owned companies are an obstacle to the allocation of greater resources to sectors such as health and education, according to a think tank budget specialist.

Mariana Campos, coordinator of México Evalúa’s public expenditure and accountability program, told a business conference she was concerned about the government’s allocation of large sums of money to state oil company Pemex and the Federal Electricity Commission.

Money allocated to address their “inefficiency” diverts resources from other areas, she said.

“The cost … of investing in companies that are not efficient is extremely high,” Campos said, adding that the health and education sectors are left with “two measly pesos” each, despite the challenges they face.

“… Thirty per cent of schools have serious infrastructure problems,” she said.

According to a México Evalúa analysis, investment in Pemex – which has more than US $100 billion in debt – will total 381 billion pesos (US $18.4 billion) in 2022, a 20.8% increase compared to this year.

Campos said the government’s absorption of Pemex liabilities is not a bad idea because it could help the state oil company obtain lower interest rates for debt repayment. However, assisting the company without requiring it to undertake reforms and restructure is not the right thing to do, she said.

“It’s a company that perhaps needs to be less integrated,” Campos said, suggesting that its component parts should be broken up. “… The structure [of the company] is still very big …”

With reports from Reforma 

Have something to say? Paid Subscribers get all access to make & read comments.
Sheinbaum displays a Finabien bank card

Mexicans in US can avoid remittance tax with government Finabien cards, Sheinbaum says

0
The government is also updating consular services for Mexicans in the U.S., eliminating filing fees and allowing online appointment scheduling.
A man stands by an open suitcase in an airport revision area

Foreign national caught with over a million pesos of ketamine in Cancún airport

0
Officials confiscated 2 kilograms of ketamine, a controlled substance in Mexico.
two people walkin gby a for rent sign

Can rent control stop gentrification? Mexico City officials plan to find out

9
Political leaders in the nation's capital have reached into their anti-gentrification toolkit and come up with an approach that goes straight to the heart of the problem.
BETA Version - Powered by Perplexity