By THÉRÈSE MARGOLIS
On Saturday, Dec. 15, newly instated Mexican President Andrés Manuel López Obrador (AMLO) presented his 2019 budget to the Mexican Congress via his Finance Secretary Carlos Urzúa.
The budget plan, which allocates more funding for social programs and infrastructure and less for government payrolls (including his own salary), is expected to be approved easily by the pro-AMLO Congress by the Dec. 31 deadline.
The 5.7-trillion-peso budget (about 7.5 percent higher than the 2018 budget) has been deemed viable and credible by both national and international financial analysts, and provides for a 2 percent growth in GDP (slightly higher than most analysts have predicted), with a 3.4 percent inflation rate.
It also specifies a semi-fixed peso-dollar parity of 20 to 1, and a daily oil production of 1,847 million barrels, with an average export value of $55 per barrel.
Because of expected increased expenditures for public sector projects, the proposed budget provides for a 2.6 percent GDP.
That will translate into a debt to GDP of about 45 percent, similar to that under the previous Mexican administration of Enrique Peña Nieto.
(AMLO inherited a debt of 9.9 trillion pesos from his predecessor, a figure that was nearly twice that at the start of Peña Nieto’s six-year term.)
Part of the 2019 forecast deficit will be the consequence of a plan to reduce income and value-added taxes along the northern border to help stimulate production and job creation in that region, Urzúa said.