Spending on Pemex is 11.16 times what is allocated to Health

The programmable spending of the public sector paid to Petróleos Mexicanos (Pemex) represented 11.16 times the resources that were delivered to the Ministry of Health in the first eight months of 2024, according to the January-August Public Finance and Public Debt Report of the Ministry of Finance and Public Credit (SHCP).

Although public spending on the Mexican Social Security Institute (IMSS) was the highest in the federal government, at 799 thousand 61 million 500 thousand pesos, which represented 23.8 percent of the total, Pemex was the second largest disbursement, at 424 one thousand 339 million 100 thousand pesos, that is, 12.6 percent of the total.

The amount exceeds 11.16 times the resources allocated to the Ministry of Health, which were 38 thousand 4 million 500 thousand pesos, that is, 1.13 percent of the total expenditure.

From January to August 2024, spending at Pemex grew 5 percent in real terms annually, while that of the Ministry of Health fell 52.1 percent. However, the sum of the expenditure in this agency and in the IMSS was 837 thousand 66 million pesos, almost double the expenditure in Pemex.

From January to August 2024, the organizations that received more spending resources compared to the same period in 2023 were the National Electoral Institute (INE), with a real annual increase of 93.3 percent; the Secretariat of National Defense (82.5 percent), as well as the Secretariats of Tourism and Energy, with increases of 64.9 and 62.9 percent, respectively.

Pemex is one of the strongest financial pressures on Mexico’s public finances due to its high level of debt; In 2026 alone, it will require $19 billion from the government to cover its cash, operational and debt payment needs, according to estimates by the rating agency Moody’s.

This estimated amount is made up of 12 billion dollars for debt payment, and 7 billion dollars for operation and liquidity, an amount that includes 4 billion dollars to pay pensions, an item that grows every year, as published The Day last September 25.

Moody’s rating of Pemex is B3/negative outlooka speculative level, so there is a 10 percent chance that investors will not receive payment for the securities issued by the company, detailed Roxana Muñoz, vice president and senior analyst at the rating agency Moody’s, at the last annual Inside Latam conference: Mexico 2024.

Pemex’s rating takes into account government financial support; without him, it would be CAone of the lowest levels, with a probability of non-compliance of 80 percent, the specialist explained.