Banamex Reviews the Finalization of the 2027 Economic Package

The 2027 Economic Package will be characterized by the continuation, for the third consecutive year, of the fiscal consolidation process. Analysts emphasized that the federal government must demonstrate that it can reduce the deficit to avoid losing its investment-grade rating and address pressures on public spending, where it lacks room to maneuver and revenues are insufficient.

“The major challenge is, clearly, to finally stabilize public debt, which has been growing in recent years against a backdrop of economic growth, but remains moderate, and where there are many rigidities in spending (...) there is little room for maneuver on the spending side, and it is necessary to reduce or at least stabilize public debt while also addressing other issues, such as the financial situation of Petróleos Mexicanos (Pemex),” said Iván Arias, director of Economic Research at Banamex.

In 2024, the Public Sector Financial Requirements (RFSP) reached a historic high of 5.8% of Gross Domestic Product (GDP). Last year, the government implemented deep cuts to public spending, but due to financial support for Pemex, the deficit closed at 4.8%.

The goal for this year is to reduce it to 4.1%.

That is why the Banamex analyst emphasized that the rating agencies have warned about the slow reduction of the deficit, making it necessary to carry out fiscal consolidation as quickly as possible in order to maintain investment-grade status.

“The most important thing to avoid a credit rating downgrade is for institutions to take steps that assure rating agencies that there will be a sustainable path to compliance. It’s not so much about a sudden change, but rather a steady one,” said Jorge Cano, coordinator of the Expenditure and Accountability Program at México Evalúa.