Two municipalities of Q. Roo, among the most indebted in Mexico

According to data from the Deputies Chamber, in total, states and municipalities have a debt of 641 million pesos.

Mexico City.– In the midst of the health crisis caused by the Covid-19 epidemic, states and municipalities of Mexico, reduce the participation and federal contributions; With a total debt of at least 641 thousand 853 million pesos, according to the Center for Studies of Public Finance (CEFP) of the Deputies Chamber. Two of the most indebted municipalities are in Quintana Roo.

Specialists consulted by El Universal considered that there are worrying elements in the acquisition of debt by entities in the event of not obtaining greater fiscal resources since the situation could lead to defaults or an even broader cut to social spendings, such as infrastructure, health, and education.

On Wednesday, this newspaper published that, according to CEFP figures, the government of Andrés Manuel López Obrador delivered 18 thousand 456 million pesos less of federalized resources to local authorities during the first five months of 2020.

The most recent analysis of the organ, with closure as of March 31 last, specifies that the states now add a debt of 597 thousand 791.6 million pesos, while the municipalities started last April with liabilities for 44 thousand 62.8 million pesos in various items.

At the beginning of the second quarter of the year, with the National Healthy Distance Day underway, the most indebted entities were:

  • Mexico City, with 83 thousand 592.3 million pesos;
  • Nuevo León, with 78 thousand 21.1 million;
  • Chihuahua, with 50 thousand 342.7 million;
  • The state of Mexico, with 49 thousand 352.1 million, and
  • Veracruz, with 44 thousand 174.9 million.

“These five states concentrate more than half (51.1%) of the total sub-national debt,” the study center report details.

He adds that those who increased their debt the most from March 31, 2019 to the same day in 2020 are:

  • Aguascalientes (11.6%),
  • Tamaulipas (11%) and
  • Yucatan (9.4%);

Those that have decreased are:

  • Querétaro (-47.5%),
  • Tlaxcala (-44.3%),
  • Guanajuato (-17.9%),
  • Guerrero (-14.3%), as well as
  • Oaxaca (-14.2%).

Regarding subnational debt per capita, the legislative body details that those with “the highest level of indebtedness, with amounts more than twice the subnational average (4 thousand 596.6 pesos)”, are:

  • Nuevo León (13 thousand 907.1 pesos),
  • Quintana Roo (13 thousand 450.7 pesos),
  • Chihuahua (13 thousand 242.9 pesos),
  • Coahuila (11 thousand 668.6 pesos) and
  • the capital of the country (9 thousand 268.8 pesos)

The most indebted with respect to total income, as of March 2020, are:

  • Nuevo León (78.6%),
  • Coahuila (75.5%),
  • Chihuahua (71.4%) and
  • Quintana Roo (65.9%).

The debt of the municipalities

At the end of the first quarter of the year, the balance of the financial obligations of the municipalities (44 thousand 062.8 million pesos) was distributed, by type of creditor, as follows:

“The highest proportion, 47.8% (21 thousand 82.5 million pesos), is contracted with the development bank; 44.2% (19 thousand 460 million pesos) comes from multiple banks; 3.2% (thousand 421.9 million pesos), of stock issues, and 4.8% (2 thousand 98.3 million pesos) of trusts.

For the start of the second quarter of 2020, the most indebted municipalities and whose accumulated debt represents 22.5% of the total obligations of these efforts were:

  • Tijuana,
  • Monterrey,
  • Hermosillo,
  • Guadalajara and
  • Lion.

The municipalities with the highest debts per capita are:

  • Cozumel, Quintana Roo (4,287 pesos per person);
  • Puerto Peñasco, Sonora (4 thousand 246.7 pesos);
  • Agua Prieta, Sonora (2 thousand 802.9 pesos);
  • Solidaridad, Quintana Roo (2,760 pesos);
  • Guaymas, Sonora (2 thousand 70.5 pesos) and
  • San Nicolás de los Garza, Nuevo León (2 thousand 68.2 pesos).
Cozumel

Why do municipalities and states get into debt?

Enrique Díaz-Infante Chapa, a specialist in the financial sector and social security of the Espinosa-Yglesias Center, explained that in the absence of support from the federal government to small entrepreneurs, who have had to assume these commitments are municipalities and states, which in turn they have been affected by a reduction in their federal participations and, besides, in their income from tax collection.

“It may be the case that sustainability begins to deteriorate, default on its payment obligations, and then affect the financial system,” he explained.

Diego Vázquez, the Oxfam economist, explained that any measure taken in a situation like the one we are living in now will have a significant economic cost.

“When the states take on a debt, they do it without fiscal soundness and they are committing income that they do not have in federal participation. It is not very clear that when the economy recovers they will be able to pay. If there is a very strong recession and the fiscal situation deteriorates This going to cause fiscal problems at the local level and there is going to have to be adjustment: getting more indebted, raising taxes or cutting social programs, “he said.

Source: sipse.com

The Mazatlan Post