Fail Economy

National

Queretaro grows economically, and falls Campeche

Fail Economy

By: Carlos Damian                                             February 9, 2016

The presidential case: annual average 1.9 percent

Mexico. -  Luis Videgaray Caso, secretary of Estate and Public Credit, announced a new clipping to the government expenditure, "beginning by Pemex", in the framework of a "preventive adjustment" obligated by the low international quote levels of the oil and what called "the volatility and distaste to the risk that exists with respect to the emerging markets". The backdrop of this advertisement is characterized, between other data, by a new fall of the national currency before the American dollar - already is about to the quote of 20 pesos - and by an increase by the price of the tortilla, that according to the Information System and Markets Integration (SNIIM, for their initials in Spanish), of the Economy Secretariat is sold until in 16.25 pesos the kilo in some localities of the country. Antonio de la Torre, directing of the Unión Nacional de Industriales de la Masa y la Tortilla, has his version and says that the increase it should be, to the fact that if the corn production is satisfactory, and though there is not shortage, "the large companies bind the price to the market of Chicago", therefore in Mexico "it was fired more with the devaluation of the peso". This shows the fragility of the governmental promises and of the Banco de Mexico in the sense of the fact that the devaluation there would not be of be translated in an increase of the inflation in the country.  In a pair of weeks the Inegi will divulge the definitive results of the economic activity during 2015, in spite of this some governmental sources have been venturesome to assure that "was obtained a good result", but the GDP is estimated in a 2.5 percent. If is taken as certain such affirmation, then the annual rate average of "growth" economic in first half of the federal administration that presides EPN, is located in a weak 1.9 percent, with all and "reforms". With this proportion does not reach neither to blow to them to the official speech called "to move to Mexico" - EPN -, and nor by glimpse to think about "better times for the Mexicans" – Videgaray dixit - and it will not be able to give form to the gas called " promissory future" that so much repeat to the ear of the Mexican citizen. While it is amended the information on the GDP in 2015, the Centro de Investigacion en Economia y Negocios (Cien) of the ITESM, campus Mexico State, in their analysis, The knowledge as driving of the growth, recalls that from 2009 the OCED was indicating that one of the problems in the economic performance of the country "has been the limited paper of the diffusion and knowledge accumulation to increase the productivity. In few words an economy based on the knowledge is the key for the prosperity, the small problem is that our country has not taken into account said item.    In this high-priority topic for any nation, Mexico has not been distinguished in innovation matter, science and technology where the capital of the country concentrates a whole slew of resources, as opposed to other states, as Chiapas and Martial. This serves as base to analyze the information on the state economic activity during the third trimester of 2015, in the one which is observed that the growth rates by annual highest were presented in entities that count on a  favorable concentration of technological resources as is the case of Queretaro (6.7 %), San Luis Potosi (6.7%), and Baxa California (- 5.2 %), due to the automotive and aerospace sectors; in contrast there are entities as Guerrero (1.6%), and Chiapas (- 5.2%) that they do not count on investments in technological matter. The "powers" economic as Mexico City (1.9 %), and the Mexico State (1.3%), and a similar behavior is appreciated in Puebla and Guanajuato. According to the information, in the last triennia the annual rate economic growth average in Mexico City arrives to 1.43 %, and Mexico State to 1.2 percent. In the event of Nuevo Leon (3.5%), and Jalisco (3%), while that of Puebla is 0.7 percent. The five states that are cited provide about 40 percent of the national GDP. The official speech presents as unavoidable the accomplishment of new clippings to the government expenditure and additional adjustment measures to the already announced - example of the bid farewell of 16 working thousands of Pemex - , but  the State there has of admitting that such determination strengthen the trends recessives in the national economy and with this is declined yet more the impact of the unfavorable international circumstance in the life conditions, in and of itself deteriorated, of most of the inhabitants of Mexico. It is certain that the national economic authorities do not have under their control the international variables that they have impacted in the fall of the quotes of the crude, and therefore, in a considerable reduction of the fiscal resources, united to this  the Mexican peso has suffered losses experimented in the exchange markets. In reality the federal government if it is in conditions of undertaking a turn in the economic policy in order to strengthening and energizing the internal market instead of dictating measures that impact in their contraction. Instead of closing sources of employment in the public sector and of imposing the expense could be carried out a reorientation in the form in which are exercised the budgets in order to implanting within the public administration a real austerity, the one which would imply to reduce in meaningful form the perceptions of the officials and top-level representatives, the trips of the foreign and the unnecessary procurements, united to this is irritant that the political class not lessen their excessive expenses given the vastness of the lack that affect to the lion's share of the population.  The Cien (for their initials in Spanish) indicates that the foreign trade showed results little favorable upon ending 2015. The total exports fell 4.1 percent during the last year, behavior that it was attenuated by the marginal increase of 0.8 percent in the manufacturing exports whose principal motor is the automotive sector, which exhibited an increase of 4.7 %. Of agreement to the Inegi, to the term of 2015 the production of the country was increased 2015, though of high does not may have nothing. Finally, the panorama shown by the Cyclical indicators System last November it was little encouraging. The coincident indicator as well as the early were located by below of the potential, so that said results permit to see that will stay outstanding the slow pace of the economy during the first months of 2016. It is necessary that urgently it is undertaken a frontal assault to the corruption, the one which costs annually to the country some 37 billion of dollars, equivalent figure to the 4 percent of the GDP.  In base to this is not overdone to assert that if is suppressed that huge national resources bleeding of the exchequer and is applied a rationalization of the government expenditure, could be destined hundreds of thousands of millions of dollars for the reactivation and the strengthening of the internal market through the creation of work position, the accomplishment of works of infrastructure with real costs, it is other words without illicit commissions and other corruptive actions. Furthermore with the real support to the agriculture, acts to dignify aspects general of the public education in all their cycles, the improvement of the health services that still it has not disappeared the neoliberal slight to the IMSS and ISSSTE, the impulse to cooperative and small companies, and in short a support to the cultural activities, among other things. It is hoped that these alternatives does not go through the traditional measured recessives of the recipe book neoliberal. Finally Pemex it was rescinded of one of their/its large ballasts, Emilio Lozoya, who was one of the worse managing that suffered, the "nonproducing company of the state". (La Jornada, politica, p.p.1- 24, February 9, 2016).