Washington, D.C. - The accusation made by opposition parties that the Mexican government is using social assistance programs for electoral purposes has not broken the consensus of the Pact for Mexico, where structural reforms promoted by the administration of President Enrique Peña Nieto are negotiated, said Luis Videgaray, Secretary of the Treasury and Public Credit, on Saturday.
He announced that in the coming week, the executive branch will make public its proposal to amend the financial system, which will set forth actions to increase bank lending to small- and medium-size enterprises.
Last week, opposition parties accused the Secretariat of Social Development (SEDESOL), headed by former PRD member Rosario Robles Berlanga, of using public programs to combat poverty for political and electoral purposes.
"One of the successes of the Pact for Mexico signed by President Peña Nieto and the three main political parties of the country, is that it was signed on the premise that there will be electoral competition. There will be differences of opinion, and distinct proposals will continue to exist."He spoke at a press conference held at the Mexican Embassy in Washington, after attending the spring meeting of the International Monetary Fund and the World Bank, and he was accompanied by Ambassador Eduardo Medina Mora.
The so-called Pact for Mexico includes a series of agreements between the government and the Institutional Revolutionary Party [PRI], the National Action Party [PAN] and the Party of the Democratic Revolution [PRD], based on several commitments, including reforms such as those already set forth in the educational system and telecommunications, as well as pending proposals regarding the financial system, the oil industry and taxes.
Regarding accusations by the opposition regarding the electoral use of social programs, Videgaray said the stance of the head of SEDESOL [Rosario Robles]--who has denied the practice and dismissed some officials--
"is clear, and I don't want to dwell on it. I believe that the Pact for Mexico is going ahead because it is based on common goals for the benefit of the country and a reform agenda that is moving along," he said.
"The best example of this is that despite this week's political events, there was also passed this week one of the most important reforms promoted by the Pact for Mexico, with a vast degree of consensus in the Senate, which is the reform regarding competition in telecommunications," Videgaray stated during the press conference.Videgaray confirmed that this coming week, the federal government will present its proposal for financial reform. ... The official proposal for changes to the financial system, which is part of the Pact for Mexico, seeks to increase lending to small and medium enterprises and give more dynamism to the Mexico development bank, he said.
In Mexico there is a strong private banking system, well capitalized and with low levels of non-performing loans, yet it provides little credit, Videgaray added. The country has one of the lowest levels of credit to the private sector, measured as a percentage of gross domestic product, the lowest in Latin America, if not within the Organization for Economic Cooperation and Development [OECD]. The commercial bank credit to the private sector is 17% of gross domestic product.
The intent of the reform, as the Mexico Pact points out, is to ensure that commercial banks make more and cheaper loans, with special emphasis on small and medium enterprises, which are generating three of every four jobs in the country, but are those with less access to credit.
"It takes them a lot of work to get it and, when they do, it is expensive," he said.Spanish original