Mexico City, Mexico — Mexico’s Secretary of Finances says the financial crunch of President Andrés Manuel López Obrador’s projects are being felt. Rogelio Ramírez de la O, the Secretario de Finanzas de México, reported that one of those crunches is the cost of the Maya Train.
He reported that the train project is going to end up costing around $20 billion dollars, 70 percent more than initially budgeted and forecast. He says the country is starting to feel the pressure of the costs of AMLO’s mega projects which also includes roadways, Internet, refineries and new airports.
Ramírez de la O told Bloomberg that the government has wiggle room to not increase its ratio between debt and gross domestic product above a range of 50 to 51 percent in next year’s budget. He says currently, that figure stands at 48.9 percent.
Last month, Mexico’s President acknowledged an increase in his nearly 1,600-kilometer long flagship train project, saying it could reach as high as $20 billion USD.
His Dos Bocas oil refinery project in Tabasco has also ended up costing more, nearly $18 billion USD, which is almost double its original planned cost.
“Obviously there is a lot of pressure which we consider normal pressure,” Ramírez de la O said. “Anything we do in 2022 and 2023 to accommodate the increase is something we won’t do in 2024, so in the medium term, it works well,” he noted.
The finance secretary is due to announce the 2023 financial budget in early September, which will have a deficit within it based on keeping the debt ratio in the target range and “realistic,” he said.
Ramírez de la O reported that the budget will support priority infrastructure projects including the Maya Train, refinery, modernization of customs facilities and development in the southeast of the country through highways and an airport in Tulum.
Beyond the key projects, “there will always be opportunities to adjust programs that have been idle or are not as essential as expected in previous administrations,” he added.