Earlier today, EL UNIVERSAL revealed that Mexico’s state oil company would cut unnecessary public spending in order to generate savings at the corporate and operating levels.
In order to meet the requirements of the Annual Austerity Program for the Financial Year 2019 , the company will let go of 16 thousand workers this year and reduce travel costs, as well as water and lighting expenses.
Pemex’s operational levels have reached an all-time low, which has made Mexico highly dependent on imports to meet its domestic demand for hydrocarbons. Rating companies have little hope that the company can pay off its USD$148.43 billion debt from last year.
The company’s financial performance at the end of Enrique Peña Nieto’s administration (2012-2018) showed accumulated losses worth MXN$1.23 trillion , representing 60% of their total debt, which was estimated at MXN$2.82 trillion at the end of 2018.
This year, Pemex was due to operate with a workforce of 111,855 people , including both trusted and unionized employees.
However, the state company ended 2018 with 128,021 employees, which gives margins to adjust more than 16 thousand job positions throughout this financial year in order to meet the budget target set by the Mexican government.
President Andrés Manuel López Obrador
announced in a morning press conference that his administration would not let go of workers on a whim, adding that budget cuts and adjustments were part of the Mexican government’s new austerity policies.
“We are breaking apart from the old neo-liberal ways. In our post-neo-liberal era, budget cuts and adjustments are not related to the dismissal of workers. What we are aiming at is generating savings and promoting austerity, which is an entirely different concept. In the words of President Juárez : Public servants must learn to live without indulging in excesses,” he stated at Mexico’s National Palace .
As part of his plan to reduce spending, he announced that the country’s presidential plane would be put up for sale. “With the sale of this airplane, as well as a fleet of airplanes and helicopters, we will generate savings of MXN$10 billion (USD$517 million)," the President stated.
López Obrador pointed out that, during the last administration, six new helicopters had been purchased for the transport of “elite” statesmen, all of which would be put up for sale: “Not even Donald Trump has such luxurious airplanes, which is why we will sell them and generate savings,” he claimed.
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