While the debt of the municipalities, from 2017 to 2022 decreased from 5,525 million pesos to 4,981 million pesos, refer to figures from the Ministry of Finance and Public Credit (SHCP).
“The State of Mexico is the largest entity in the country, so, yes, a considerable amount is seen, but if you take it in relation to its economy, the level of the entity’s debt is relatively good,” Kristobal Meléndez told Expansión , specialist in state public finances.
The percentage of public debt as a proportion of State GDP (PIBE) of this entity was 2.8%, slightly above the average of the entities of 2.7% in the first quarter of 2022. The lowest is Campeche, with 0.4%, and the highest Quintana Roo, with 7%. Coahuila had 4.7%, reports information from the Center for Public Finance Studies (CEFP) in the reference period.
“There are other entities that are more indebted in relation to their economy, such as Coahuila, and there are states that have a level of indebtedness similar to that of Edomex, but are paying a higher amount of interest or debt service,” Meléndez explained. .
There is also another comparison in which the State of Mexico comes out well, and that is when its debt is compared as a proportion of the freely available income it has, such as the participations it receives from the federal government, and the income it generates itself. the entity for the collection of local taxes.
“Participations are freely available income that can be given as a guarantee for the payment of a debt, while the contributions that were given for teacher payrolls, health services are already destined for activities, so entities cannot give as collateral”, specified the specialist in local finances.
Information from the Treasury details that the amount of the entity’s debt represents 80% of the resources it receives from the federal government, under the concept of participations. However, if other unrestricted income is added, such as one’s own, the percentage drops to 36.4%.
There is another indicator that does not mean an affectation, but quite the opposite: that of short-term financing, which at the end of 2022 was -2.3%, which means that the entity “has a lot of liquidity. It is not at all representative in comparison with the money they handle, they can pay it as if nothing had happened”, says the specialist.
In accordance with the Law of Financial Discipline of the Federative Entities and Municipalities, short-term financing must be settled three months before a change of administration, so that in the next reports of the state debt a light in this type of financing.
“Whoever wins, the perspective is that the debt of the State of Mexico continues with a downward trend, because the participations and own income have the prospect of increasing year after year, with the financial discipline law, financing would only be for products, or productive activities, this gives the feeling that if there is indebtedness it is for an important project”, commented Meléndez.
