The President-elect Claudia Sheinbaum On Wednesday, he ruled out resorting to a tax reform to finance his government’s spending, which will start on October 1, and confirmed that among his priorities will be the reduction of the fiscal deficit.
During a first meeting with the members of the Business Coordinating Council – the highest representative body of the private sector in Mexico – after his victory on June 2, Sheinbaum affirmed that among his government’s objectives will be the reduction of the fiscal deficit to a maximum of 3.5% of Gross Domestic Product in 2025. This year the deficit is expected to close to around 5% of GDP, which will be the highest level in more than two decades.
The Secretary of the Treasury, Rogelio Ramírez de la O, who will remain in office during the Sheinbaum government, had announced at the beginning of the month that among the priorities of the next president will be the reduction of debt to around 3% of GDP and of the fiscal deficit, in addition to maintaining financial discipline, adhering to the rule of law and respecting the autonomy of the Bank of Mexico.
Ramírez de la O made the statement in an attempt to calm the markets after the nervousness that was unleashed after the victory of Sheinbaum by a large majority and the ruling Morena party, which will have control of Congress. There is concern among investors that the new Congress will carry out a constitutional reform of the judiciary that provides for Supreme Court ministers, magistrates and judges to be elected by popular vote.
Despite the secretary’s statements, volatility in the markets has persisted for more than two weeks, causing a depreciation of more than 5% of the Mexican peso. At the beginning of the day, the currency reported a slight depreciation that brought the price to 18.41 pesos per dollar.
Sheinbaum ruled out before businessmen that he was going to promote a tax reform to finance public spending, and announced that a Digital Transformation Agency would be created to speed up the procedures in force in the country by up to 50%.
Given the concerns expressed by some businessmen about the judicial reform, the next president denied that it is an authoritarian measure and that it seeks the concentration of power.
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