Mexico - Current economic position and prospects

RESTRICTED FIL COlP Report No. CA-6a nis report was prepared for use within the Bank and its affiliated organizations. They do not accept responsibility for its accuracy or completeness. The report may not De. published nor may it be quoted as representing their views. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION CURRENT ECONOMIC POSITION A NTTT P P rqrC'T.S MEXICO December 1, 1970 Central America and Caribbean Department CURRENCY EQUIVAIENTS U.S. $1 = 12.50 pesos 1 peso (Mex$) = U.S. $0.08 1 million pesos = U.S. $80,000 TABLE OF CONTENTS Page No. BASIC DATA SUMMARY AND CONCLUSIONS ..........................i.... I. GROWTH, SECTORAL DEVELOPMENTS AND PROSPECTS ............1 A. Background ..---.---- .....-...-...-.-.-.-... 1 B. Overall Trends in 1969 ......................... 2 C. Main Economic Sectorns ...-.--.-....--.----..--4 Agriculture and Livestock ..................... 4 F ish eries-----------------------------------------aG 14 0 A 9* 1 7 Industry ....................................... 8 Min . .. 11 Transport ..................................... 12 D. Papulatio an4n Sc nScoA Csa ...4 ..1 C... 13 Poe V , A tonLA I A . .. A. .... . .... *************** Population ................................... 13 Public Health and Social Security ........... 16 QuAlJty of ELVimLInt.IIA . **.............. 7 PUBLIC D ST E OR INkTTMENkT A%N FIAC ............. .kU 19 Ae iLve---I-n, Savin1g, ai DUAoUwillg ********** 19 B. Current Account Performance .................. 20 rueral Government ......... .................... L Federal District ............. ............21 Decentraizea Agencies ...................... 23 C. Planning and Investment ............... ....... 24 rPanning .................................... 24 Possible Future Public Investment Pattern ... 25 D. rinancial Projecuous ........................ 2 TTT mnonrrm .n v CREDJIT, RICESL ANDu WAGES....................................33 A. Money and Credit .............................33 B. Prices .......................................... 36 C. Capital Markets............................... 36 D. Labor ....................................... 37 IV. BALANCE OF PAYMENTS POLICIES AND PROSPECTS ............. 38 A. Balance of Payments and External Debt ........ 38 Merchandise Imports ............. ............ 39 Export Promotion ............................ 41 Tourism ....................................... 43 Private Capital Flows ......................... 44 B. Creditworthiness ............................ 45  -2- STATISTICAL APPENDIX T- Pnulation and Emnnyment TT National Acconts iTi Balance of Pamonts e.A Cvn-n1 TraAn iT -eLa1 T)ek- 17. D-1,1 4. 'c os "ane sa Vi earyLL OLI-L.L L.D 'TTT A LSt.t..Lt. 1 L J i cs VIII. ULher Sector5 Lx. Prices and Wages This report is based on the findings of an economic mission to Mexico in April/May 1970 composed of Messrs. Guy Pfeffermann (general economics), Nicholas G. Carter (balance of payments and quantitative analysis), full time, Messrs. Peter Ruof (monetary analysis), George i. Beier (fiscal analysis), Robert A. McPheeters Jr. (external debt), part time, and Messrs. R. Payne and R. Wellwood, Consultants (fisheries and forestry).  BASIC DATA Area: 2 million square kilometers Population: 50 million (1970) Growth rate: 3.4 to 3.5 percent per annum. 1960 1968 1969 1970 GDP in current prices (MexZ billion) 151 338 374 - Per capita (US$) 334 572 612 - Real growth rates (percent) - 8.1 7.2 - Structure of GDP (percent) Agriculture, livestock, forestry, 15.9 12.5 11.8 - fisheries Mining 1.6 1.0 1.0 - Tndnstrv (including netrolpum & petrochemicals) 20.4 23.9 24.1 - ront.Mntin 6-2 7.0 7.1 - Power 1.0 1.6 1.8 - 0Athoiv- (mntQ+.1y ract) ,) 11.0 C) - MAney annnly norment h - 10 'AloA - GDP deflator 2.0 3.2 - Mexico City wholesale index 1.9 2.6 - Federal Government: c ent r n 7 30. ni4)l current expenditure 7.7 21.6 24.4 27.3 Federal Diistrict (Miov-i nrj +-r) current surplus 0.8 1.6 1.6 1.7 Decna i-An -nklH a-n+n- Mann-ina*- current surplus 3.6 5.4 6.1 6.h Tot,-'±. p,,k- c00 secto cunrn't surpV'lus 1 ~77 n I , - 7 1960 1968 1969 1970' Public Finances (cont.) CaDital revenues - 0.7 0.2 0.1 Public investment 11.2 23.1 26.9 28.6 Net domestic borrowing 1.7 7.4 8.4 9.LL Net external borrowing 1.8 3.0 ).7 b.0 Total borrowing 3. li 13.1 11 Public investment financed out of non-horrowqi rPqonrrPq (nercnt) (I I 3 services 1,330 2.,453 2,714 2,846 services -1,481 -2)648 -2,839 -31048 payments - 151 - 195 - 125 - 202 Factor income payments (net) - 160 - 545 - 576 - 645 Balance on current account - 311 - 740 - 701 - 87 Private direct investment (net) - 38 227 249 295 Uruss puU±1 buu iuv Cr_w±ug for investment 317 751 860 880 mortiauion fu pubic sector debts/ - 172 - 479 - 462 - 560 Other capital flOwS knet), errors and omissions and changes in reserves 2e 2u4 5n 232 Public medium- and long-term debt (million US$) Total outstanding (end of period, including undisbursed) 842 3,198 3,511 - Debt service: Interest 44 188 151 196 Amortization 172 479 1 462 485 dJ Total service 216 623 bij bbi Debt service ratio (percent of exports of goods and non- factor services) 16. Z .4 Z2.0 2.5 Structure of new external borrowing (percent) / International institutions - 21.t 11.9 - Bilateral credits - 14.1 6.1 - Bonds& - 13.0 8.5 - Suppliers' credits - 16.5 21.6 - Financial institutions - 35.0 51.9 - IMF position (million US$) Quota 180 270 270 - Drawings outstanding - - - Super gold tranche - 651/ h51 - SDR allocationlY - - -- Gross rAqAves h37 758 691 - Net reserves 437 743 679 - Relationship to monetary or customs area Member of LAFTA N+t member -f rATT a,' Pro ec+^~-'~ / An Ae - +4c ats a +for t e+ 1070 fimna ic Marinn nuhlic sector necounts figure, which exceeds Bank projections because it may include roll-overs of less than one year debts. / fuliztiuvs. 1/ u's LUJ2l.ugIUueo Z/ U..L;.y jwUiU Y.L-.LVatPV.LJ I1/ r £WUJ IU 1 .L"gz V.L Vvakio I.- , P 'JL& -V Fund's holdings of peso 58 percent of quot. K/ AS oI january 1, 17(U rie XU waS a-LVUvdUU u1v qXLV1LU4 %J.y Drawing Rights.  SUMMARY AND CONCLUSIONS 1. Mexico has achieved a fast economic growth rate (6-7 percent) without excessive inflation during the last 15 years. A climate of confi- dence in the Mexican economv has nrevailed both at home and abroad. larpely owing to political stability, institutional continuity, and successful crowth-nrientd Prnnnomic noliries hacked un hv exnanding foreien exchange earn- ings. This was reflected in the full convertibility Lf the peso and in sub- srantinl inflnAj nf forpion nnhlic and nrivate canital. Industry has been the leading sector by its size and growth performance, but considerable imnrnmmnVc have -nlIsQ hon achi d-vprd in nariiiltrp and in the -nrial -eq- tors. Perhaps one of the most telling signs of economic and social trans- formation hn bon the rise of the urban nonnlation from 14 to 30 millinn since the middle-1950's. Mexico City is now one of the largest cities in the rnrlel rith n nnitlntinn olnc, f-n nina million 2. Thi4s rema ble gto 1nr,uth perfoarmance as een suppr,ted by1~, ~ hg national savings and investment rates. The public sector has played a investment and growth-oriented economic policies. However, partly because Of1 LIAe 'low levels LA. pUulic revenues, a rlaielVJy *low prior-I." V-c k--- given to tackling the complex problems associated with raising productivity, incUiomes diU Welidi Ue LI[t UUlk U LLt LULdi pupUldcLUin, WhI LIt LJLA LUSi prises some 20 million Mexicans. The Government also realizes the need to speed up the pace of improvement in education ana pubiC health, anU LO meet the demands for public expenditure that arise out of the rapid popula- tion expansion. Wnie MexiCO I ±OW tax rates nave conruULeo tO spuILing private sector growth, they also have restricted the Government's ability to give a higher priority to meeting these demands. 3. The development problem is further complicated by oexico s external situation. Mainly because of sluggish exports and rapidly rising tourism and factor income payments outflows, Mexico's balance of payments on current acccount has deteriorated sharply during the latter part of the 10 s. This deterioration has serious repercussions on Mexico's future development because imports were compressed as a result of successful import- substitution policies carried out since the Second World War, and the raLe of growth of the economy now appears to be closely associated to the import capacity. Because of this structural rigidity an increase in external borrow- ing has become the only alternative to slowing down the growth rate of the economy -- with the economic and social consequences this entails -- wnen- ever an export earnings shortfall occurs. Up to now the Mexican authorities have chosen to maintain a high growth rate in spite or the widening balance of payments deficit. 4. The strains entailed in the policy-mix outlined above - relatively low public sector revenues and savings, rapid economic growth with a widening external deficit - have been somewhat alleviated by monetary policy. Confidence in the Mexican peso has been reflected in the willingness of the Pu_4 4_ b4 ------- 4*- 4n the )- L- - - t-e rate during the latter half of the past decade. Through reserve requirements teC BaLnk 03. 11C.&ICO 1LaO L0 VJp- Flow of sav ng aand has,00VJfl. L5 L UJ.,Vt1erLLE-_U a substantial portion to finance the public sector deficit. Because domestic aelCit fiidnlg 1a1, sUL noexceuu t e 'incoae inl SoVing IALt.IU LI1 LLIt banking system, the process does not appear to have been inflationary. Thus, Lnce LVU) HUGU JU CLCL K UW A CL L&AIVC OLEIALIL HOL U U L 11Ltd bu 0p re t pb i e tr in et et' s be ia ced by domestic public sector borrowing, while the average annual rate of price increases did not exceed 3.5 percent. 5. However, al[ioughn uumestic Vrrowing Lur public investment financing has increased at a faster rate than external borrowing, the rise in foreign borrowing has also been rapid. Annual gross public medium- and long-term borrowing has increased from US$320 million in 1960 to US$860 million in 1969, and as a result the total outstanding public medium- and long-term debt (including undisbursed) has roughly quadrupled. The service on this category of public debt now amounts to nearly 23 percent of Mexico's exports of goods and nonfactor services. Moreover, while i1exi- can authorities haU been successful until 197 in improving the maturity structure of their external public debt, the trend has been sharply re- versed in 1969 as world financial markets became tignter. This deteriora- tion in terms has made it all the more important to give the highest prior- ity to devising and implementing imaginative policies to increase foreign exchange earnings and raise the level of public sector savings. These prob- lems cannot,be resolved by short-term measures alone. A new Administration will take office in December 1970 for the next six years. While little can be said about the specific policies and measures intended by the incoming Administration, this report outlines what seems to be a warranted and plaus- ible approach for the medium- and long-term, which would help to confront the problems foreseeable for the future in the same constructive manner as previous Governments have overcome many of Nexico's past problems. 6. The export-promotion effort des4rves the highest priority in agri- culture, livestock, fisheries, forestry, iAdustry, mining and tourism. Agricultural policies have contributed to the deterioration of the balance of payments. The sharp decline after 1966 in cotton exports from irrigated districts is closely associated to changes if support price policies, which have led a large number of producers to abandon cotton in favor of grains, where risks are less high thah for cotton. The critical influence of ad- ministered prices on the pattern of output (support prices for crops, water rates in irrigated di6tricts, land taxes, taxes on inputs, etc.), has been clearly revealed by existing studies. Because Of the urgent need to increase foreign exchange earnings, CONASUPO's price 0olicies should be revised as soon as feasible to redress the bias against totton in the areas best suited for that crop. To be fully effective, CONASUPO policy changes may need to be backed up by changes in price and distribution policies, e.g. for water in the irrigated areas, fertilizer, insecticide and power, in favor of ex- - iii - port crops. Lastly, the partial withdrawal of the Government's crop insur- ance system has recently deterred farmers from producing cotton in some important irrigated areas; there is a need for re-orientation of coverage in favor of cotton and other export crops. Fisheries and forestry offer considerable scope for import-substitution and exports, provided Mexican authorities bring to bear development-oriented policies on these two sec- tors. The changes that appear necessary are mainly of an institutional and administrative nature. 7. Until recently the mining sector was one of the least dynamic in the economy. Mainly because of the recent upturn in world prices and new investments the trend has been reversed and mining, with the exception of sulphur and lead, has very good prospects. Known reserves of major minerals are adeauate for at 1east 15 vers and while there is some Justifiable concern in Mexico about exporting non-renewable resources such as minerals and petro- Tr thero also i..a oin awareness that the balance of national gain cr loss will eventually depend on the use to which foreign exchange earnings from such rnorts are nt. Tnrlustrial exnrts have Anna, n-it wall in recent years, but there remains a very broad scope for further expansion. There- fore stdyig th,e question of indust-ial export incent-ives deserves high priority. Little is known about the origin of industrial exports, the causes for relative. failure of exi4sting, inc--entives and th-e level of remuneration expected by entrepreneurs in order to focus on export production. The existing protective system, based mainly on import licensing, is. heavily biased in favor of domestic and against export production. Moreover, reli- anc o qantitatiLve import ~LLLL ret"cinsII Uas dicuaged~ .industia special ization and thereby contributed to keep Mexican industrial prices relatively 1-4 1V A ~ 1C ~ 1 4 ~ L1 J . 4 % g1 LUUd i sil 1I101 11Util.b LUI LOiL11ti5 IIIy LitI.p I1I LUVlI] L sUULCe allocation within Mexican industry. At the same time, Mexican authorities coulu LLy LU uI IieL Lite vias agais L exputs . lhis couu ve acieveu iu a variety of ways, notably by compensating exporters for the indirect taxes uuties levieu on inputs (Law materials, parts, mnac[Finery aliU equipment). In any event, no such scheme can be considered in isolation fr. om t #1heflcal measures 11eded tU fin111e iL. AltL11aLive lecauLeS tiat deserve to he examined include an extension of the automobile industry legis- lauon tyiug pu L Licenses to expurtL pivLLULRUIU LU ULIUeL InLuuLieS, and action through the reserve requirements of the banking system in favor of 0. rolicies to 'evelop tourism furter deserve high priority, as tourism remains the single most promising field in which to achieve a rapid and sustained increase in foreign exchange earnings. The opening up of Acapulco to foreign air carriers was followed by an unprecedented investment boom in hotels and by a sharp increase in the number of tourists. The same approach could prove successful in stimulating growth in other resorts. Pro- motion of cheaper air tares between the U.S., Canada and Mexico and encourage- - iv - ment of medium-income tourism can all contribute to a rise in tourism earninRs. These policies have acquired particular importance since Atlantic and Pacific tourism from the U.S. has become less expensive in the last few years, while the cost of tourism in Nexico has not diminished. 9. The fiscal performance of the Federal Government improved slightly in 1968 and 1969, owing mainly to the built-in elasticity of a fairly pro- gressive income tax system. The value-added tax, which was originally sched- uled for enactment in 1969 has been shelved for the time being. The Federal District (Mexico City), which has generated savings on current account con- sistently throughout:the decade, and which had formerly lent its surpluses to the Federal Government, has become a large net demander of funds after 1967, mainly owing to the construction of a subway system, and has depleted most of the savings it held in the past. The decentralized agencies can be divided into two groups.. The first group generates substantial savings and includes Pemex and.thei-power sector. However, as a percent of GDP the cur- rent surplus of these agencies had;dropped from 1.5 in 1965 to 1.1 in 1969. This is mainly because.Penex diesel and gas prices have not increased during this period, while current expenditure went up considerably. A recent com- prehensive IBFD-study.of the-transport sector leads to the conclusion that an increase in diesel,fuel; prices is warranted to increase revenues and to avoid subsidization of diesel users. As a group, the remaining decentralized agencies contribute very little to savings, and they absorb about 7 billion pesos (US$560 million) in Federal Government transfers. 1he railroads, with 1969 transfers of nearly 1.5 billion pesos, the social security (1.8 billion pesos) and the agricultural price support agency CONASUPO (1 billion pesos) are the most important. Among them, the railroads show the only widening deficit; it has doubled:since 1965 and risen by one-third in 1969 alone. The Government is reviewing its railroad policy at present. To keep the railroad deficit from widening any further in current prices would seem to be a feasible minimum objective. 10. On the basis of.historical trends and without major new measures, tntal nuhlic speror savings are likely to grow very slowly from 1970 to 1976- they would decline substantially relative to GDP. It is clear that because of the clw grnwth- in..nihlir Rprfnr navino- ndiitinn1 nrcp nf fi,nne will have to be found or.expenditure curtailed. Rough estimates of the mini- mum public Inetet eurdtor mantafin econnmic vvnt4 nnti tn IffrniAn modicum of improvement inzthe social services as well, suggest that there WouldA ben a need for a-rong" mouintsa of donmestIc pulIci sectorbroi g s pecially after 1972. .Sot-long as private savings channelled through the banking4- .ysem, 44-uin a substantia amounto... , ~It,~~ to increase at the fast.-rate of the last few years the domestic component of UULLUWLg U HUL Uee no enflationary* - A rUeLiU LUL AL UUL.UWLLHA WUULU, however, lead to rapid-increases in the debt service ratio., By 1973-1976, wo1 L[Il dUMEHCC UL Labod ilEdUtta LU 30ILLecc UUlintL.LL adV1IIb LIili idLIU would be well above 30 pe.rcent. - v - 11. However, public revenue action could slow down the increase in the rdpht s-rIc rai s -,Y - cigcn ifIcntlyf I trf Itf an4mc at- inrean-ing overall do mp.qicJ savings at the expense of private consumption. Additional public sector reve- nues of the orAe ,F4bhl1on peos n uer bhLaer)4 1971 nne 1Q7A wnfilr probably be required to rIaintain the debt service ratio under 30 percent. In to only about 5 percent of current public sector revenues, which should not in revenues could be achieved by a combination of measures. Federal revenues #uuAU U L ±5 ZL C tU b U LO I L LI1Ly iK _LUUA.i L I U L LI Ci UY,ILU IVCuLurtl o e Ci.n e Uo cemnt . A shift from the existing sales taxes to a value-added tax system would also have fdvUoa ivenue efeCLb Uti ULLCLy ad LULUUghl VCULIULiY UC11C11 inasmuch as, through computerized data processing, it would provide a basis IUL llt CiltCLIVC CIALU1CCiittlL US ULLICL illdjUL L_ACb Ab 1.11 CJL L ILVC, 0U0 sideration may well be given to a single stage sales tax which poses fewer C4UtoUCIinL prUlells Lt1a11 Lie ValUe-dUIed LA an1U aVUUs Le cascade CfCfL of the present mercantile tax. A series of more gradual -- but nonetheless .rportant -- changes could also be considered, in particular as regardS Lax treatment of agricultural and unearned incomes. Furthermore, some of the benefits accruing to the private sector from public expenditures in urban areas could be captured through improvement levies, higher property taxes and more frequent reassessments. Finally, trhe exican authorities might raise the prices for the products of decentralized agencies where this is economi- cally appropriate. l. According to Mission projections, gross public sector external borrowing requirements are expected to amount to some US$7.4 billion between 1971 and 1976, or about US$1.2 billion per year, if no major measures to raise public sector savings are taken. Given the presently foreseeable flow of pro- jects suitable for official external financing, international and bilateral lending agencies may at best be expected to provide some US$400-500 million per year, so that most of the balance would have to be financed by bond float- ations and by suppliers' credits and loans by private financial institutions. While Mexico has been extremely successful in the past in placing bonds abroad, the extreme tightness in the international capital market in the recent past has severely limited this source of funds, and may do so for some time to come. Thus, while not negligible, this source should not be expected to pro- vide the bulk of the US$700-800 million of annual foreign borrowing that would be required from non-official sources if no major revenue measures were taken. But if credits in these amounts were to come from private suppliers and banks, the hard terms implicit in this borrowing pattern would increase Mexicols debt service obligations to a point where in the mid-seventies they represent some 33 or 34 percent of current account exchange receipts, as against about 23 percent in 1969. These levels are quite high, and can only be sustained if the international financial community continues to have con- fidence in the Mexican economy. Even if public savings are raised by the amounts described above, the debt service ratio could not be prevented from - vi - rising, ht new horrowing would hi, -uffiriPntlv rir1iired to normit thp debt service ratio to stay well below 30 percent. Rapidly rising external indebt- ednesss i not, in itselft a cause for cnnrern amon creditrr n- Inn( as it is not interpreted as a-sign of failure to resolve the country's fundamental structural conomic nrohb1ms: the cliicich hoh-quior of rxnorts, tO low levol of public sector savings., and ultimately, the low productive capacity and pnchning nor nf n ci7onhle nrt of the nnulation Conversely, demonstrn- tions of a continued awareness of these problems, and of a willingness to bring to hear on them the full I w ni Inconuity nliithn whv iwih ot-hcr rinme,ic problems have been resolved in the past, will not only help to reduce the growth of external indebtedness itself, but also wIll lnm large in the ido- ments external creditors are likely to make about Mexico's future ability to con trac t an s 0ervi ce ex tern- al_ d eb tS. A re cent der-re s tren-h tening fthe Finance Ministry's control over external borrowing -- particularly by decen- The past record strongl.y suggests that Mexican society has the required re- .ourc S-4- cosion.: ab4lity ndA an14>4-aT ..411 k a, h e.n sUurces Uo :usoca" Luco n, avi1;-t anu politIcal will" to take the neeueu measures, and thus to preserve the enviable image of a fully creditworthy borrower. I. GROWTH, SECTORAL DEVELOPMENTS AND PROSPECTS A. Background 1. Mexico achieved a fast rate of economic growth (6-7 percent per year in real terms) without excessive intlation during the past 15 years, while consolidating the deep structural changes of the Revolution of 1910. Political stability and institutional continuity have played a decisive role in maintaining a climate of confidence at home and abroad. This has been reflected in a formal system of free convertibility since 1946 1/ and in exchange rate stability since 1954. In spite of a rapidly growing popula- tion, real incomes per capita have risen from about $400 in the middle- 1950's to about US$640 this year. Industry has been the leading sector by its size and growth performance, and development has been accompanied by massive urbanization. Since the middle 1950's, the share of the urban popu- lation has risen from 45 to 60 percent or, in absolute terms, from 14 to 30 million. 2. Considerable improvements have also been achieved in the social field. The death rate has fallen from 16 per thousand in the early 1950's to about 9 per thousand, a level prevailing in many highly industrialized countries. Primary school coverage has increased from about 45 percent of the school-age population around 1955 to about 66 percent in 1968 or from 3.5 million to 8.2 million students. During the same period, although agri- cultural growth was slower than industrial development, some important struc- tural changes have taken place in rural Mexico: in particular, self- sufficiency in basic foodstuffs was achieved during the mid-1960's, largely as a result of large-scale irrigation investment, and exports of agricultural and livestock products have developed at a relatively satisfactory pace. Outside the irrigated regions, however, agriculture has progressed at a sluggish rate; productivity and incomes of the bulk of the agricultural population have remained low, posing one of the most intractable problems in Nexico today. At the same time, the massive influx of population into the cities has created heavy new demands for urban infrastructure. 3. High overall savings and investment rates have contributed decisively to the satisfactory growth performance. During the last decade, gross domestic investment averaged 19 percent of GDP of which about nine- tenths was financed by national savings and the balance from abroad. Public investment, which accounts for about one-third of total investment, has fluctuated rather sharply. It rose by over 20 percent ner year in current terms between 1961 and 1964, then dropped in absolute terms in 1965, the first year of the nresent Administration- to rise anain hv about 20 Dercent per year in 1968 and 1969. In contrast, public sector savings have risen nt n rPPttnr nare hv about- i; nprrent nor vpnr, Ac A rult the Ist- 1/ The peso was freely convertible even before 1946, when Mexico became an IMF member under the provisions of Article VIII. decade can be divided into two phases: (a) between 1960 and 1964 the share of nublir investment financed by borrowinv increased from 30 to 50 percent: (b) in 1965, because of restrictive public investment policy, the borrowed charo dronned to 27 nercent. and then rose to reach 50 nercent again in 1969. The gap between public investment and public sector savings has been financed b" t-rjn-thirc nt of domestic borrowine and one-third out of forpifn Inann 4. Alth-fi d oetic borrowirng for public invest-ment fina~nrinc- haq increased at a much faster rate during the last decade than external borrow- i-g, the r-Se in fnaidon horrowinc' hn also been ranid Mainl hi-ace nf sluggish exports, and rapidly rising tourism and net factor income payments 4PIOWS, Me 4_ V h1 - n-f nn, - nn -riirnnt- on nnr b1c flnrrAnn- sharply during the latter part of the decade. The annual deficit on current account, ufflih averge about US1.1 millo be.II twe.- LW 96 anI4.d 191162 1-1- -1iO to almost US$700 million per year after 1966. While Nexico has been success- lul InL attractLing 'Large aoutsLL o4 private fore4.in Lcapit.,t aLO.iZvol4.umc, of foreign loans has also been necessary to finance the balance of payments current ueficit adu sevice tUhe uZv1t vtLlie past. CInnual gruss puu1 medium and long term borrowing has increased from US$320 million in 1960 to U.?0u) mil.tL.uln in .u, anu tC total outstanding pulA med4um an uon term external debt (including undisbursed) has roughly quadrupled during the last ecaie dU amoiLLU Lu aoUUL US.3YJ5 U1lllil L L1t: CIU 01 S7 a result of rapidly rising public external borrowing and of slowly increasing foreign exchangeearnings the(L public dcbt service ratio has risen frUm - - _. percent in 1960 to 22.6 percent in 1969. 5. Heavy dependence on the vagaries of international markets points to a need to strengThen eOLLrts at increaSing foreign exuange earllngs ano raising the level of public sector savings. The problems, however, cannot be resolved by short-term policy measures alone. A new Administration will taKe office in December 1970 for the next six years. While little can be said about the particular policies and measures intended by the incoming Administration, this report outlines what seems to be a warranted and plausible approach for the medium- and long-term, which would help to con,ront the problems foresee- able for the future in the same constructive manner as previous Governments have overcome many of 1exico's past problems. B. Overall Trends in 1969 6. Overall .growth of output in 1969 was in line with the trend of the last decade. GDP increased by 7.2 percent in real terms, slightly less than the year before (8.1 percent) and price increases were moderate (3.2 percent). The slight difference in growth between the two years was caused mainly by a decline of 2.1 percent in crop production in 1969; most of this setback can be attributed to highly unusual weather. Most other sectors, with the ex- ception of power and mining, also slowed down slightly. However, except in agriculture, forestry and fisheries, growth rates were still high by international standards. 7. The investment rate rose from 20 to 21 percent of GDP in 1969, mainly as a result of a 15 percent increase in public investment; private investment increased by about 10 percent, both in real terms. Increases in total investment were paralleled by increases in domestic savings from 19 to 20 percent of GDP. In line with the last decade's traditional pattern the private sector's factor income payments abroad exceeded the inflow of new private investments. 8. Monetary and credit developments for 1969 were more satisfactory than expected in the light of unrest prevailing in the international money markets. The end of speculation in Europe during the second half-year, together with measures taken by the Mexican authorities, especially the raising of interest rates, resulted in an 18 percent increase in total bank- ing system liabilities. The increasing flow of private savings enabled the banking system to support a 20 percent expansion of credit last year. In the current year, the banking system is expected to continue to attract private savings at a high rate. Depending on international interest rate develop- ments the increase is projected at about 16 percent, which would support another large credit expansion. 9. The balance of payments on current account improved slightly during 1969. This was caused by a substantial increase in manufacturing exports as well as by the inclusion in the 1969 earnings figures of a cotton stock carry-over from 1968. On the other hand, imports of merchandise did not increase significantly, mainly as a result of a levelling off in imports of capital goods, especially transport equipment. The current deficit was reduced from US$740 to 700 million and there is evidence that the deficit would have been even less had Operation Intercept 1/ not severely affected tourism and border trade for a while. However gross public sector external borrowing increased by US$100 million to a level of US$860 million, even though external public debt amortization oblieations were not higher than in the preceding year. This occurred at a time of very tight international credit markets and is reflected in a drastic shortening of the average maturity of new debts. While this partly reflects a legitimate unwilling- ness. shared by many developing countries, to contract long-term debt when interest rates are high, it will further aggravate the debt service burden in the coming vers. 10. Brniqe of n Rh.qrn reduction in otton arrpap. commodity Pxnnrts in 1970 are expected to reach, at best, last year's level. Total export earninps would only incrrqs hv 2-3 nprcnt- The rtrrent nrornnt deficit is, therefore, expected to widen from US$700 million last vynr to nhout RA30 million, even though the ponomy may only roy at the -- for Mexico -- relatively slow rate of 5.5 percent. This slight slowdown 1/ i police action by U. S. authorities designed to curb contraband imports would be consistent with Government intentions to keep the growth rate of niihl ir invp tm-nt hp1 nyjrha nf CT-P fhis vzPnr A ndri thprhy echow the nwr- expansion of public expenditure traditionally associated with election C. Main Economic Sectors - - -LL. ,mnY .- - , - - - - - ,--'1--tcu-r-t,l in,1 l 4 r,, h a att"" '1 emp t e t o t i k a balance between two long range strategies: to increase output at a satis- factory rate and tog impov in the rural a r eas. 'Nex-I ccha been more successful in increasing production and has gone further in reform- uI 1LLU L1iu L Hk I L UuuLL4e Ali t e wu tI. iitt.' t LUsi1.L U LLuti UI public investment, credit, favorable support prices, research and development, diU , 1i1.CI en.L U.LL UL ULILV LIL1 tIIJD 111 Llt0 IU'L pli ii ll- 1 L 1U tib 000 Mexican Government has achieved considerable success in creating a national 1.1- u 4O~r.~1 1-1 0 L flt 4 :-fl 1 -L , 4 i IvC i n uu 2 I U ULo eavask-et alnu stimulat g tS gro(Lwth over d-r 4-teAtu,114LU traditional net food importer, had achieved self-sufficiency in major food crops Uy LLite 11 9604)' . LUB L o MeC'U s food UULtUL Utipilnates 111 lare commercial farms on irrigated land, mostly situated in the sparsely popula- tea Northwest Of tLe country. DSIUe 1950 nearly 9U percent oI public invest- ment in agriculture has been devoted to these large-scale irrigation districts As a result, about 80 percent of agricultural output growth between 1950 and 1960 (the date of the last agricultural census data) have originated in 3.3 percent of the countryls farms and subsequent changes do not scem to have been drastically different. As import-substitution in basic food crops was achieved, the pace of development slowed down. Although the data are only approximate, it would appear that the average increase in the area coming under irrigation dropped from almost 60,000 hectares per year in the late fifties and early sixties to less than 50,000 hectares per year in the late sixties. 12. However, less than 2 percent of the country's population lives near the modern irrigation districts, so that the bulk of the rural popula- tion has been largely bypassed by the effort at raisino output and produc- tivity. Most Mexican farmers live in the crowded Central Plateau, a revion of poor soils and inadequate rainfall. Mexico's land reform, one of the most far reaching in the Western World, has attempted, by breaking up the hacLenda system, to move back towards a more equitable land tenure pattern. The eiide or rural community, is the keystone of the land reform; it has its roots in 1/ Mexican authorities regulate public investment mainly through the LW.LllIe IlIt ILIAZII@ GLaI.LY41ZU Al Utid?L LI. L lty dIUU UtP L ttIL policy to limit public expenditure expansion. Thus the growth of credit from public sector banks was limited to no more than 5 percent for 1969. - 5 - pro-colonia1 trndition Tho crnns nf thp lnni refonrm has hen wide in- deed. Over the last fifty years, nearly half of Mexico's arable land was Aictribte,l benfting cmo 2.5 millin fnmil1i4 d4ort-v B 190 ahont half of the country's population lived on ejido land. Land redistribution, and t1he hope for further dis tribution , havr e^rdi nA nf t-1 n f n mon t- n1 elements for social and political stability in Mexico. 13. In more recent years, arable land available for redistribution has tributed land is ill-suited for cultivation. The typical Central Plateau _44'1 consists insmall1 1 Ir 4 A ~ i -* in 1.960 over 80 percent of holdings --whether private or ejidos -- provided Most modern inputs, adequate water supply, technical assistance, credit, 11X5iiY tUV L U 0 U CdL.1 lt ULILiLi hc: n,v tirst b L 5kades, ctcC.. remit I UULLU the reach of the bulk of the rural population. 14. Population pressure has, of course, exacerbated the strains exper- Lenced by the rural. population. Tis is reIecteU in te growing number of landless farm hands and, above all., by the swelling stream of migrants that leavC Lhe countryside for tne cities. T1-e ew aLa avaiLDe Vn income dis- tribution suggest that there are strong economic reasons for urban migration. ilc lowest 30 percent among ilexican families - mostly rural - experienced a decline in the share of personal income from 10 percent of national personal income in 195u to 7 percent in 1957 and 1)63. This does not necessarily re- flect an absolute decline in income, but points to the fact that most of the rural population's incomes have grown at a much slower rate than those of the rest of the population. 15. The Government has become increasingly concerned about the rural income and productivity polarization and has launched, under the aegis of the Presidency, an imaginative rural small-scale investment program. This consists in coordinating some 4,000 small rural works per year in water sup- ply, schools, feeder roads, power connections, health centers, etc., in vil- lages between 500 and 2,500 inhabitants, partly on a selt-nelp basis. The response of the rural population has been extremely positive. Much of the investment requires substantial labor on the part of villagers, and throughout the poorer regions people have willingly worked for the program. Until now, however, the program merely coordinates the residual investment resources included in the executing agencies' investment budgets. Because of its great economic and social usefulness, the program may well deserve substantially larger resources than the approximately 800 million pesos (US$64 million) devoted to it in the 1970 budget. 16. IT. 1969 crop production decreased by about 2 percent. A severe drought in the Central Plateau as well as in Northern Mexico contributed to the slowdown. The production of corn, Mexico's basic staple food, declined by 9 percent between 1968 and 1969. Food output fell off 4 percent. However, most of Nexico's agricultural output grows in the large-scale irrigation dis- tricts, in the Northwest and Northeast, which were not affected by the drought. - 6 - Despite some serious problems of excess salination in some of the districts, what outnut went un 26 Dercent and alfalfa 24. Tomato production rose hv 22 percent, sorghum by over 30 percent. Strawberries and other fruit also ,-nandsd annrPciqhly. Much of the increase in wheat and sorehum has hl-n 4t the expense of cotton. Cotton acreage has been reduced by about 25 percent diring 19AQ and nonmtp fell by nearly 30 nercent. This Is a. mior somrce of concern because cotton is a very important foreign exchange earner. The nuec for tho chift from eotton to grains are rnmnlpy and vary from diqrict to district. However, the main reason for the farmers' shift seems to be the onmnnnvrnti-trl- lr.7nr exnertd returns npr hPrtarP of ntfinn- oiun tiYrrentlxr prevailing support prices in grains and the higher risk associated with cotton. Tropical areas were not affected by tHe dr-ught either andAj ics4t- of some excessive flooding coffee, sugar, bananas and cocoa did very well last year. Prospects for 1970 are as yet unclear; however, it is already clear that cotton output will reach a new low (about 1.7 million bales of a peak year). 17. It is clear that a great effort will he needed in the field of gri4C-1 turc. Ahlthough the Mexic.- '14overnment hL, tTiUd to1 i-Lcrea"se tl-Jw share of resources channelled into agriculture, these attempts have not raise the share of public investment in agriculture from 11 percent (1968) LU ..)z W11 1 WoUU ILchVC UeLn aI allJ M -1 Ius at t u Ju il LUV L tIeilt figures for 1969 show, however, that the share of agriculture did not rise. This points LU a neeu to stLen,pLtuLI pruject prepnr.tOlAU 41 I.- IL sector agencies investing in agriculture, particularly with regard to small-scale irrigarlon word Loteo an out by g inistry vi .gitcuatur. 1r 1.,a _Ln wurKs kDULU2u.1 LciLt-U U UL U: I1U ;-Li -)L U1 -. CUA LUre. 18. The dualistic caracter Uf agri culture is reconized by tne t,ov-- ernment and has been an important theme in the recent campaign of the President-elect. One or tne main instrulents Lt ne Gove rnmenL s agricul- tural policy, price supports, have reflected this dualism, on the one hand their purpose was to provide incentives in tne capiual-intensive irrigated areas, while on the other hand they were used as a form of social welfare support in the densely-populated capital poor areas. 19. A reexamination of the particular means used to achieve agricul- tural growth and welfare, as well as of the resources devoted to each, may well be high on the agenda of priorities of the new Government. There is wide agreement that action is necessary to ensure that in the poorer rural areas productivity and income will not be turther outstripped by the rest of the economy. Moveover, since market limitations appear to be one of the obstacles to development in the modern sector of the economy, such an effort may well be justified from the standpoint of overall development prospects. A reassessment of price support policies, their structure and incidence, their contribution to exports and their fiscal implications would rank high in such a reexamination. 20. The drought has severely affected the central and northern areas w ereeport cleare rasd Lck- of water andI Auer %(parly atrint able to a drop in cotton seed output) threatened the lives of a sizeable nUIlUL UL caLLie. 10 dVULU CaLLie UedLil, a '.[a1 1UllUgeL Un LOLLe, jll cluding very young animals, was sold last year than is normally planned. i.UW'VLL, LIIC IlidLIUIidI Aimpact Ut LLM UL UUgLil Lb 11LL LL tL.ULLU inL utpuL aU export figures; these continued to increase along the past few years' trend. l / The embargo on exports of heifers, which Inad een lifted pro- visionally in 1968, remained suspended in 1969, which seems consistent with a rational livestock development policy guided by market criteria of efficiency. Fishcries 21. Nexico's fishery development on a nationally significant scale began with the discovery and exploitation of the rich Pacific Coast shrimp beds in 1941. those of the Gulf of Mexico in 1945 and of the Gulf of Tehuan- tepec region a few years later. That develonment was spurred by the con- tinualil expanding U. S. market, whose imports rose from 5 million pounds in 1940 to 1.93 million pounds in 1969. Mexican production rapidly rose to a peak of 40,000 metric tons in 1961 and has since declined for a number of reasons, to 32,000 tons in 1969. Although the reasons for Mexico's produc- tion decline are incompletely understood, they relate to variable natural. availabality, the rate of exploitation at sea, the extent to which young shrimps are caught in the lagoons, and the adverse effects of the "Crecn Revolution" of the Northwest on the lagoon environment essential to shrimp rearing. Agricultural development has decreased the fresh water flow to those lagoons and increased the insecticide pollution. A pilot lagoon environmental control program by SRh shows promise of reversing those negative effects. 22. There is a need to reexamine the present institutional framework. The Fisheries Law of 1949 reserves shrimp, lobster, abalone and four other species (about 80 percent of total value of Mexico's total fisheries catch) to cooperatives, in many respects the equivalents of ejidos at sea. The cooperatives face a host of problems, among which, in some cases, are poor management, over-staffing of vessels, excessive administrative overhead and inadequate accounting and auditing. In the Pacific Coast shrimp fishery the Government's setting of a 55/45 division of catch proceeds between boat- owners and fishing cooperatives often creates insufficient incentive for boatowners and has a depressing effect on the industry. 23. There is also a need to reexamine the respective roles of public and private sectors in fisheries. The former has become directly involved in catching, processing and distributing operations through Government-owned enterprises, some of which are operatine unsatisfactorily. These enterprises doininate the fisheries industry on the West Coast. The public sector also 1/ These figures tend to mask the actual condition of the herds which is undoubtedly not as good currently as in the past. - 8 - greatly influences the industry throuch the Banco Nacional de orcento Coonerativo. whose effectiveness in mohilizin resources for urowth cnuld be greatly improved. There is a general lac1 of crecit to the Private fish- eries sector and this constitute a maior restriction to exnansion. List-or- ically the. private sector has been the innovator and developer in this in- dustry. and it would benefit considerably from the availahility of mUdium and long term credit. 24. Total fishery production has expanded at about 7 percent annn 1v for the last decado. However- imnorts of fish meal- an cssntial input for modern poultry development, have soared from 4,000 to 7( ,u00 tons n 1 , Drnlc t- t P nr d,ti on n t-and n n soiniq nt- 1i- 0 flf0) tone nor -.c-r although substantial stocks of anchovy for conversion to fishmeal are available Off Baja California. About <:1RA ; f( te r-- the feasibility of an anchovy fishery expansion: the import substitution fleet has been recently expanded and the pace of further growth will be UeterinedLC by LiiC perforan tice of tleJSI nc,-. vessls.t lC i '$L Z i favorable. The prospects of continuing growth of fisheries generally are alksoJ good an, air enhanIced bth jtcint U.. C.~Li AI 'IJ through FAO. This 5-year program which began in 1969 will cost US$3.7 101131011L. L it w 1. UDE U 0 C) Letl y UI LinautuLLCU iItU.1LL L)UL yFUbt VCe ,Sil4 dUll other facilities to execute a development-oriented pro.oram of research, training dinU LULil diaiU U tes tLa eLUV H oLn a LULnrUtidi Udsis L]e uI[iestic consumption, supply and quality of fish and fish products. Industry 25. Nexican manufacturing, has grown at a very fast pace during the postwar perioc and last year bas been no exception. incustry grew by about 9 percent in real terms, and growth prospects are also favorable this year. industrial development has been aided by low taxation, 1/ low iaor costs and relatively high levels of effective protection. Since 1960 some 30 percent of gross domestic investrent has gone into industry and petroleum, increasing the share of these sectors in CDP from 20 percent in 19*) to nearly 25 percent now. Industrial investment is mainly tinanced trom tne sector's internal resources- and domestic and foreipn banlinp credits. !ost industries have maintained an attitude of indifference toward the stock market, and very few firms have financed a significant share of their requirements in the capital market. Firms that did issue stocks in small denominations were successful in placing them among the public. 26. Manufactured exports have shown remarkable dynamism in recent years. They increased from US$50 million in the early 1960's to about / j U 'I U t s iuch, becauscex oFlw rtes y-u raahe l ute 14ic -14tedu tax a uLe d L' I LLL I xc Ls s LdUe L du c caused by excessive' deductions. LSf2I0 million in 1969, accounting for 1_R.6 percent of total exports. 1/ einn n,onrities recgnize he inreaingly importnt role industrial exports will Play in the future and would like to implement those export- promotion policies that are most likely to maintain or increase tre dynais.. of thr last decade. aånufactiired exports still represent only about 5 percent of inoustria] outpkit. nufactured p well nrove to 'e of crucial irportance in help-'ing Yexico solve her long-term 0pnceof payments nroblIler. In£ thI;s context an export credt, JinsuraC, nst i tution has b-een created in 1970, in order to supipement to the Iank of -icc's Fund for T xport n 1 a ci ( F-1 C 1,) 27. While part of thttlie re as ono fr hih-ot-rtso anfcue e.ports is the very low point of departure in terms of the share of out- Put xr re.lauive price staiLjity and excess capacitV in sU.~ import- ant industries also accounted for some of the increase. The development of iborder inlustri es has also contributci to the growth of industrial exports. 2/ exico provides special fiscal incentives, duty-frec imports of equipment and raw materials, etc. to export industries created along the U.S. border and in other parts of Mexico. The status of these indus- tries is similar to those in free ports. U S. Sfirms have taken advantage of this opportunitv to set up plants in certain types of processing where low xwa,es are necessary to attain international competitiveness. Althoug.h the first of these industrics was established only four years ago, there are now about 150 such plants providing employment for more than 16,000 workers. mainlv in textiles, electronics and light electrical equipment. 28. Apart from FOMEX, which is currently lending about US$70 mil- ljon per vear, efforts at promoting industrial exports have been rather ineffective and dispersed among a great number of agencies with little or no co-ordination between them. Fiscal incentives amounting to cuts of some 2-3 percent of production costs appear to be ineffective, partly because of excessive comlexity. The Banco Nacional de Comercio Exterlor, a Covernment institution set up to promote exports, seems to be active mainlv in traditional agricultural fields but could well perfori a useful role by increasing efforts in industrial export promotion. 19. The automotive industry presents an interesting example of export promotion policies. The Mexican market absorbs about 150,000 new cars per year. There are eight manufacturers and each plant's output is limi ted by an annual Governmnent quota. This quota limits imports and iielps to keen some of the least efficient plants in operation. Mexican policY during the last decade placed emphasis on import-substitution, by owever,~~~~ 1969v figuresZC may~lUS ovrsiaeteinrae eas alance of payments data were revised that year to reduce "errors and omissions 2 .:r-nfactured goods trade may have heen overestimated in 1969 on account St staisicl UifILCUJLIC bSUCILPU 'socULt DwOrUer iIUtrLL.Les. - 10 - setting a minimum 60 percent local content requirement to manufactures. Des pite thdis rlcatively% highbL -Io- cotn th ietIprDotn er car is still of the order of US$1,,000, which means that the 150.000 e::Jcan Emphasis on import-substitution has also resulted in the maintenance of UtOMUM Ui PLtL1S L 4 LUIIq a1 L V Y 1Higi LeVe. U-111.i - UU t[ lk - d OU the balance of payments effects of the industry, the Government in (c:tober 1969 passed Leg I lation, to i u ce autoLvU,o I %T C, exports. -nue- -o e flew -aw licence to import inputs is tied to exports (of parts, vehicles or ecuip- ment) for any one firm. is year the industry is legally bound to 11mit its imports to 20 times the value of its exports. In 1971 imports wi 1.1 be limited to seven times te value of exports, anc over the next rew 'ars a point should eventually be reached where imports will only be autliorize] up to the value of exports. Several- firms have reacted positively to the new law. Even before the law was passed, the value of car parts e::ported went up from US$4.3 million in 1968 to US$17.3 million in 1069, suggesting that given proper incentives, exports might rise significantly. If the law proves effective, it may well be possible to extend it to other import- intensive industries. Thus petroleum and pctro-cheiicals import over US,l50 tuillion per year, without, at present, generating significant exports. 30. Other tools might be brought to bear on the industrial sector to encourage exports. 1/ Action through the reserve requirements of the banking system to stimulate credits to industrial exporters might be a flexible and effective instrument, and would be in line with existing provisions tying certain required reserves to agricultural credit. The protecti;ve system has not been changed much in recent years, and over 60 percent of imports (in value) are subject to quantitative restrictions. Licensing is the basic tool of protection policy, with tariffs and tax exemptions in a subsidiary role. However, there are some indications that the system mi.-ht be in the process of being altered at present. While quantitative import restrictions used to be granted with little regard for prices, since 1069 protection is no longer normally granted for products in cases where the domestic price exceeds the world price (usually the US price) by more than 90 percent. 2/ Mexican authorities intend to reduce the 90 nercent iear::in gradually, but are fully aware that this is likely to be a very slow process. It has been the experience of some countries that liberalized imports have increased competition, and that this has induced domestic producers to -reater efficiency, thereby improving their international competitive position. If such a sequence holds in the case of Mexico, the Government's intended policy to reduce protection slowly might help the balance of payments in the long run. In any event, the deficiencies of a protective system based essentially on import licensing have become increasingly apparent as the degree of soohis- 1/ The question of export incentives is further discussed in Chapter IV. 2/ 25 percent for certain new industries. - 11 - tication of Mexican industry has increased. Difficulties of obtaining lic- enses and unreliability of certain domestic suppliers (especially for parts and components) have induced firms to integrate backward, thus encouraging inefficient small-scale production lines. A gradual shift away from reli- ance on licensing in favor of tariffs may help improve efficiency in Mexican industry by encouraging a greater degree of specialization. 31. The prospects for further rapid growth in tile manufacturing sector are good. If the economy continues to develop at anything like its past pace, the demand for industrial products will grow rapidly and will require correspondingly large investments in domestic productive capacity. Import substitution will increasingly mean preventing an up- surge in imports which would take place if domestic capacity were not expanded, rather than replacing ongoing imports. This, and the vital need to develop competitive exports, adds urgency to the need to avoid policies that would induce inefficient investments. The impressive growth and diversification of Mexican industry during the past twenty years suggests that existing resources in imagination, entrepreneurship and flexibility in the public as well as the private sector have the capacity to solve the long-run balance of payments problem, if they can be brought to bear upon it. Mining 32. Until recently the mining sector output was one of the least dynamic in the economy. World prices and uncertainties surrounding mining legislation were the main causes for relative ntanation. Substantial tax incentives to "Mexicanized" mining enterprises effective since 1967 and the unturn in wnrld nririq have reversed the trend, and mininv with the exception of sulphur and lead (both because of the anti-pollution drive)- hAQ very onnd pronects. Most mining cnpannio have started nw ventures during the last two years and some marginal mines have been reODened. The mnRt imnnrtnnf nrniert in this setfnr i.q the exnlnitntion of a recently discovered major copper deposit at La Caridad in Sonora near the Ari7ona hrder, A inint Mexican/foreign rnrnnrqtinn hns hpen formed to exploit the deposit; scheduled investment over the next five years nmairnnc f-n cmITTcy___-f million bn-. in minio and in smelting hnn- tial iron-ore deposits exist along the Pacific coast in Las Truchas, near tihrordr between. Grrero and,lhon plansC are beiqn ng tuiedi tor produce steel from these ores starting in 1975. Prospects are also ex- r.l,ntn where Meio ro neAd Its pe a s c nutmber one worl producer in 1969. 33. Government policy is aimed at encouraging domestic processing of minerals rather than raw 0t-erl_al exports. This 4S done through fiscal differentiation and appears to be effective. Therefore, the upswing in the medium term, and should thus improve somewhat Mexico's balance of paymntspostio.--------- --A-- -.----C1---- payIIztL~ ~~1rO1 LNIUWLI L1Z!bULVCb U1 1116JUL LU1LLh~d1 kILC CLUt!4UCLLULL % - 17 - least 15 years and while there is some justifiable concern in Mexico about exporting non-reewabl -reouce sc as ineals( I an-41(1[ t..L(. t*t ... AC also is a growing awareness that the balance of national gain or loss will evental depend on %th us to wh (ich~ foreig exch=nr,e C 4.L5 £L such exports are put. Transport 1/ 34. Except for a large section of the rural population that remains isolated from the main stream of 1exico's economic life, the mobiity of people and goods has been amply provided for through a multiplicity of transport modes. Historically, private capital first served to develop the basic railway network, which was subsequently taken over and modernized by the Government and now comprises some 24,000 route kilometers. The past three decades have witnessed the rapid development of the highway system, not only in length -- Federal and State roads increased from less than 10,000 km. in 1940 to over 70,000 km. in 1970 -- but also in quality, with recently built high-speed expressways radiating out of Mexico City. A rapidly growing road transport industry creates a constant necessity to upgrade the system to meet traffic demands. For the movement of petroleum products and natural gas., Mexico has an extensive network of pipelines as well as a fleet of tankers. While ports have not received fully adequate attention, the resulting bottleneck does not arise so much from a lack of physical capacity as from operational inetticiencies and institutional complexities. Some 75 airports are in operation in Mexico, of which 30 are suitable for medium or long range flights. There are two main domestic airlines, a network of feeder airlines and good service to foreign cities. In short, Mexico has a well developed and relatively efficient transport sector which, except for parts of the rural areas, does not restrain the country's economic development. 35. In spite of this, the Government considers the problem of the transport sector to be acute as it is making increasingly heavy demands on the limited budgetary resources. Annual outlays on road construction and maintenance, for instance, rose from 1.7 billion pesos in 1965 to 2.6 billion in 1970. Over the same period, total Government support for the railway operations, investment and debt servicing increased from 1.3 billion to 2.3 billion pesos, out of which the railways' cash deficit on operations accounted for some 35-40 percent. Moreover, as the transport sector has grown in complexity, investment criteria and policy decisions need refinement to ensure the coordinated operation and development of all modes and to con- form to an emerging new emphasis on developing high density, low income rural areas. 36. In addition to the lack of a clearly defined national transport policy, a major deficiency in the present transport planning mechanism is 1/ Vnr 8prarll APP the forthcoming report of the IBRD Transport Sector Mission to Mexico (1970). - 13 - the lack of coordination among the various agencies responsible for project generation and investment programs and for the regulation of the services and tariffs of the various transport modes. Investment programs proposed by the different agencies are submitted directly by the respective agencies or ministries (Public Works, Communications and Transport, Navy, etc.) without proper economic evaluation to a joint commission of the Ministries of finance and of the Presidency. Such a central review body obviously is not designed to investigate itself the economic merits of individual investment proposals, nor can it effectively relate investment decisions in their final stage of preparation to other important policy decisions, such as vehicle licensing or rates and fares policies or to developments in other sectors of the economy. 37. An increasing part of investment should in the future be directed to adapting the primary transport system to traffic needs, as they arise, rather than to the extension of the network. Proper economic criteria must be developed and applied so that the difficult task of selecting priorities can be performed more effectively. For the development of the secondary and feeder road network, an integrated approach to planning must be estab- lished that will associate other sectors of the economy and local interests with the planning process. 38. Now that the basic transport infrastructure has been largely completed, the Government will have to devote more attention to providing the institutional and policy framework that will allow each mode of trans- port to play its role economically. The danger arises otherwise that the Government will be saddled with a growing deficit on the railways that could easily reach unmanageable proportions, should the past trend continue. It is important, in particular, that prices in the transport sector reflect the economic costs involved in providing services. An analysis of the production and distribution costs of diesel fuel indicates that diesel users are in fact being subsidized by the tax payers at large. On the other hand, the railways are required to maintain uneconomic services, mainly passenger services, or to carry freight traffic at less than cost to provide subsidies to various categories of users. Within the broad econ- omic philosophy of a mixed economy, Mexico has the instruments and prece- dents to establish a competitive framework with freedom of choice by the users of transport services. D. PoDulation and Social Sectors Population 39. Preliminary results from the 1970 census indicate that the artof 4a abu 3.54percent, pec a m es c Thi i t a rate of about 3.5 percent per annum over the past decade. This is the result of a birth rate of about 45 per thousand and a very loW deatlh - 14 - rate of 9 per thousand. Evidence on changes in the demographic structure of thp cnuntrv is scant and often conflictini. The fertility rate annear to have been constant at 200 per thousand for the past four decades and cn 1i kelv to rpmin Qn for at lTnRt the npxt ten vpnrq Thi. fprtilit-y combined with an age structure where 46 percent of the population is less than 15 x onFc nocy choil d increce the nonpu Iti on growth rnte hut factors such as the decline in fertility associated with migration to urban areas are expected to offset this tonAo nny. nb ne,Mx thus probably can expect a steady increase of population of 3.5 percent tw -. 11. 045 - - - - - in the rural than in the urban areas, substantial internal migration is 1.5 percent per annum. The effects of population growth, therefore, show u p m o s t s h a r L I i n0h 1 U L'L rL L u b a r ea s. 'u1 , IOA L L U 0 9 . L -d W i l C I now has almost 9 million people, has been growing at 5.5 percent per annum over Lue last uecade. Lue Guuaaaaa area nas grown at J.; percent while the Monterrey urban concentration grew at 5.5 percent. 41. For a long time, the Mexican Government was concerned about underpopulation. Fifty years ago, after the Revolution of 1910, the Mexcian population was only 14 million with a growth rate of less than one percent per annum. With vast reas Of empty L6LIU cI[U 5UU5ndLLL1d1 unused resources there was a definite problem of underpopulation. It was not untli Le 1y3u Lhat Luhe population vegan to grow noticeauly anu not until the years just after World War II that the growth rate reached the current level of 3.5 percent per aunumu. IwLroughOut Lis period Mexican agriculture was able to feed the growing population and at least in recent years the net increment to the national labor force has for the most part found employment. In addition, there was an abundant supply of land available for redistribution and the public sector was in a position to satisfy the minimum social overhead capital. 42. During the last decade this situation began to change. The Government is becoming increasingly aware that there is, in ettect, very little productive land left to be redistributed, that the needs in social overhead capital are now stretching the means of the public sector and that unemployment may well increase in the future. All this raises serious questions about population policy, questions which are gradually receiving increasing public attention. Mexico, in gommon with many other countries, is faced with the problem of how to reduce the burden of a rapidly increasing population in the face of deeply ingrained attitudes favoring large families. The current official response has been a passive attitude towards family planning, allowing family planning organizations to operate without interference. At present according to official statements, family planning is not and will not be the answer to Mexico's problems and the emphasis should be on an improvement in family life. - 151 - 43. .Currently the availability of family planning services is some- what limi,.ted. Althug mterals are1 avial at any nVharm acyi, the cost is beyond the reach of most, and there is generally no advice available on the usage . As th reul o --If -FA---4--14-r -- -~ - - - 4 10969 materials and advice are available at no cost in all social security L..i .L L u L iL L j Li.L X _LM Z30~ Ut=VCL1Un VL1 LII1V t LLLAtL O =.0 J. A of a doctor who knows about family planning. In addition, there are seveLai 4dLamily pldnillng ULdizdLUins -i nALLU UUL LILCLe ae pLUUaly no more than 50 clinics spread around the country, mainly in the urban areas. In general, the emphasis is on euucation rather than service anu is directed to the official and medical community as well as to the families who receive the service. ihe approach to family planning is through the concept of a balanced and integrated family life and the provision of family planning materials is therefore part of a much larger effort, involving education on the rights and dignity of women, family health, and the central importance of the family unit. It is estimated that there are nine million women of childbearing age in Mexico, but at present there are at most 250,000 women actively enrolled in clinics and it appears that the number of enrollments is increasing fairly rapidly. Most of the increase appears to be a result of the publicity given to the clinics by recipients of the services. At present, the main limitation to expansion of family planning is on the supply side, particularly in the availability of medical personnel to administer the services. Education 44. Education expenditure is of the order of 12 billion pesos (1969) or 3.2 percent of GDP. Of this, some 60 percent is financed trom tederal funds and the halance, in about equal shares, from state and private funds. Public expenditure on education is low by international standards. A UNESCO survey indicates that in 1965 Mexico's public sector spent 2.7 percent of GDP on education, compared to 3.8 percent for the developing countries' average and 6.2 percent for the developed countries. However, because of the low share of public expenditure in GDP, education absorbs a large pro- portion of federal expenditure. This proportion has risen from about 15 percent in the late 1950's, when primary school coverage was about 50 percent to nearly 30 percent at present, while coverage rose to about 66 percent of the primary school-age population. Of the latter, however, only about one half -- thus only one-third of the respective age group -- receive more than two years of primary education. There has, moreover, been some deceleration in the increase of coverage as new schools have been built more and more in remote and small villages. The yearly current increase in federal expenditure on education has fallen from 15 percent (1960 through 1965) to 8.5 percent (1965 through 1969). 45. Although the coverage has increased a great deal, only a small fraction of the school-age population actually completes primary school. The number of secondary and vocational graduates is also small, especially when viewed against an annual increase in the active population of over 800,000. The following table highlights the importance of drop-out rates. - 16A - EDUCATION SYSTEMl ENROLLMENT, 1968 Grades or years P1 uilnar School cycles 1 2 3 4 5 6 and Total school-age over population re~-scholu 0.7 L.L J L±JU J Primary 2,435 1,66ou 1,393 1,00 1 6o9 8,157 12,400 Secondary & Vocational 426 293 220 negl. negl. negl. 941 Professional 1/ 38 28 23 neg1. negl. negl. 91 Preparation to University 99 72 16 - - - 187 University 57 39 34 27 17 3 177 Total 9,893 1/ Secondary school degree required for entry. Source: Centro de Estudios Educativos. Out of two million children who entered primary school in 1962 about 700,000 reached the sixth grade (or about 35 percent). The single largest cause of this high rate of attrition is the limited availability of facilities in the rural areas; most rural schools offer only one or two grades. 1/ 46. The figures suggest a need for further quantitative as well as qualitative change. Both present an arduous financial problem. There appears to be a need for a comprehensive review of educational objectives and policies, with special emphasis on economic development requirements and on public and private financial resources for education. Public Health and Social Security 47. Some remarkable results have been achieved in public health. Perhaps the most impressive has been the drop in the death rate from 15 per 1,000 in the early 1950's to about 9 percent at present. This is below the level in many developed countries and has been the major cause for the rapid increase of the Mexican population. Pan American Health Organi- zation statistics indicate that the number of doctors (1 for 1,900 people) and of hospital beds (1 for 560 people) is relatively high by Latin Ameri- can standards. However, services are concentrated in the cities and rural 1/ See Statistical Appendix, table o.7. - 17 - health facilities are often highly inadequate. In Guerrero and Zacatecas, 1 for 280 in Mexico City. There is room for further strengthening of 2,300 medical students is quite high but, because of the high rate of population inceas , -L-- 6,;--IlO a-nd LFLLH LL, l_LUULU per 100,000 inhabitants does not appear to have risen appreciably since _L:? UV About ou percent 01 Mexico s O, uuu Lluspital vedu aUL" LLI VUU.LL hospitals. The two main agencies in the field, the Health Ministry and the Social Security institute Manage respectively 30,0U anU 14,000 bUs. The social security system covers all public sector employees and private sector employees who work under a collective labor agreemeUnL. Ie ntl6iLL1 Ministry facilities are open to those left out by the social security system. The Social Security Institute alone provides free medical services to about 2.8 million private employees and their dependents, or some 10 miliion people. Under the new labor law social security woula be extenae to employees not covered by collective agreements, but working under indi- vidual labor contracts. This would, within about three years, increase the coverage of the Social Security Institute threefold, or to about 30 million persons including dependents. Most of the rural population, however, may be left out of this increase, since labor contracts have been uncommon in Mexican agriculture. Quality of Environment 49. Erosion and maldistribution of rainfall have long been two dominant aspects of life in much of rural Mexico. Last year's drought highlighted their importance. An imaginative relief program for 1969 and 1970 was worked out by the Ministry of the Presidency to alleviate hard- ships in the most severely hit areas, particularly Durango, Zacatecas, and San Luis Potosi. It consists of a great number of small public works aimed at creating employment and income for those farmers who lost a sub- stantial portion of their crop last year. The Government's contribution consists mainly of technical assistance and wage payments. The farmers' response to this type of program suggests that it may also have applicability in non-emergency situations. In the State of Zacatecas, for example, the local population levelled large cultivable areas against wind erosion, and constructed nearly 600 water retention dams in seven months with almost no mechanical help. The total cost of the national relief program is about 350 million pesos yearly of which about 60 percent is channelled through the Ministry of Hydraulic Resources (S.R.H.). The great willingness of farmers to work -- often at less than the official minimum wage -- when their labor contributes directly to their future welfare suggests that a great deal more could be done in this way to improve the quality of the rural environment. In the dry areas of Central Mexico, relatively inex- pensive water retention dams can provide unprecedented security to a rural community. Their greatest cost may not be money but the organizational - 18Q- and administrative talents of S.R.H., an organization which has already built up an envi4abLje and deserved reputation for techn1.calco2pece Small water works and labor-intensive anti-erosion campaigns could, there- Lore, very well bucme a numal feature LU Le't: an pLLL JUU.LLU ieVtm,Le1Cnt programs. 50. The population of the poor areas in and around Mexico City has proliferated at a tremendous rate creating a host oi intractable social problems. However, given proper planning and the allocation of sufficient resources, tuere are some grounds for optimism. An example is the area of Netzahualcoyotl, east of the airport, which grew from 60,000 to 750,000 people during the last ten years. The State of Mexico has recently begun to put in some of the necessary infrastructure, but has been hindered in its efforts by a shortage of resources. A six- year plan for Netzahualcoyotl has been devised by the State Government which would require about US$80 million. The plan assumes availability of substantial external financing, but none has been secured so far. Netzahualcoyotl is generally considered one of the worst problem areas in Mexico. However, the impression that emerges even from a superficial visit is one of energy and hard work. The population has a relatively high employment rate, and although there is hardly any water supply and no sewerage system, an impression of relative neatness prevails. Most houses are built through community effort. Much of the free time available is utilized for construction work. There is an urgent need for water supply, sewerage, power, roads, urban transportation (the trip to the industrial center of Mexico City takes two hours), schools and hospitals. Policies to cope with the increasing population around Mexico City may be most effective, if some form of coordination is established between the Federal District and the surrounding states. 51. The Mexico City smog has reached a disturbing level. Because of the ring of mountains surrounding the city, the ?revailing Northeast winds find no adequate outlet and smog and dust accumulate in the city. The situation seems to have worsened considerably during the last 2-3 years. It is estimated that currently about 2,800 tons of combustion wastes and 600 tons of dust fall on the city every day; however, the visible components of smog, such as dust and smoke, are not nearly as toxic as the invisible ones such as carbon monoxide and sulphur dioxide. Available figures suggest that the concentrations of these pollutants is at times higher than in most smog-affected cities in the U.S.A. Some 500,000 motor vehicles contribute about 70 percent of these substances, although petroleum plants and thermal power plants are among the most conspicuous of about 30,000 industrial offenders. Quite apart from the social costs of air pollution, there is some evidence that the smog has reached such a level that it is receiving increasing publicity abroad, and thus may eventually have an adverse effect on the earnings from tourism. - 10 - II. PUBLIC SECTOR INVESTMENT AND FINANCE ,e LLVtbi L1iLIL., 0tVL1Hrp, aLLU DULLUW.LL 52. Yearly fixed investment of the public sector in constant prices nearly doubled during the decade 1960 to 1969. It increased by 17 percent in 1968 and an additional 15 percent in 1969. 1/ In zurrent terms, the annual fixed investment nearly tripled in the decade, growing at 21 per- cent and 20 percent per year in 1968 and 1969 respectively. Growth has been general, but the Federal District has increased its fixed investment at a particularly rapid rate, investing eight times as much in current terms in 1969 as in 1960 mainly because of the construction of a subway system. In spite of rapid growth of fixed investment, the level of total public in- vestment is relatively modest in the face of economic and social needs. comprising only 7.3 percent of GDP in 1969 and averaging only 6.6 percent of GDP for the decade. About half the investment took nlace in independent enterprises, e.g., power companies, the state petroleum company (Pemex), and the railroads leaving less than I nprrent of GDP for investment in the Federal Government's portion of the public sector. 53. Public investment is financed by public savings and the small canitn] rPvPnnPq nf GnurnTmnt v intprnml hnrrnwinc_ nnd hv hnrrnwinv abroad. Since public savings have not expanded as rapidly as investment, ranidly ernwing net horrowing has hon no-ceary, as chn In the tnhle below: PUBLIC SECTOR INVESTMENT AND FINANCING (billion of pesos) 10) IoCA 1965 TOAA 1097 1AR 19Q Investment 11.2 18.1 15.2 18.2 18.8 23.1 26.9 Public Savings plus capital Revenues 7.7 9.3 11.0 11.1 11.4 12.8 13.8 Financing Gap = Net Borrowing 3.5 8.8 4.2 7.1 7.4 10.3 13.1 of which internal net 1.7 4.8 4.7 5.8 3.9 7.4 8.4 external net 1.8 4.0 - 0.4 1.3 3.6 3.0 4.7 External gross borrowing (4.0) (7.8) (4.3) (6.6) (8.9) (9.4) (10.8) External Debt (2.2) (3.8) (4.7) (5.3) (5.3) (6.4) ( 6.1) amortization Source: Ministry of Finance. 1! Data on public sector finances do not include state and municipal governments (except for the Federal District) because of lack of com- parable estimates. In 1968 these governments spent 8 billion pesos (US$640 million) of which 1 billion (US$80 million) was "investment" broadly defined to include all public works, construction, and capital transfers. Data are insufficient to determine a savings estimate for these governments. - 20 - 54. The growth of domestic borrowing to cover the imbalance between because deposits in the banking system have risen very rapidly during the U L U U ~ ~ LCL CL X..~ CAC.iLUL..Ly L .L -_Z O _IL.LCI.±y Lt± L S per- vasive confidence in the peso. The strict reserve control of the Bank of rUxCU Lilb LuueL.u iU _JV LUy percet vi the uepus L ti ucrese into the Central Bank, partly for non-inflationary public sector financing. 55. The increase in domestic and external borrowing has, however, had serious consequences, both for future availability of public sector savings to finance domestic investments and for the balance of payments (see Chapter IV). The rising volume of gross external borrowing (from US$320 million in 1960 to US$865 million in 1969) reflects a parallel increase in net borrow- ing and amortization obligations and both reached unprecedented levels in 1968 and 1969. As a result of increasing reliance on borrowed funds for investment, interest payments have risen from 0.5 billion pesos in 1960 to 3.8 billion pesos last year, an average growth of about 25 percent per year. The share of interest payments in total Federal Government current expendi- tures has risen from 6.6 to 15.7 percent during the period. In the future interest payments are likely to aDSorD an even greater share of current federal expenditure. B. Current Account Performance Federal Government 56. The level of taxes, current revenues, current expenditure and public savings compared to the Mexican GDP are among the lowest in the world. In the past decade there has been little change in these ratios as the following table shows: FVDFRAT. CnVFRNMV.NT TNlTCATOR_q (% of GDP) 1960 1964 1965 1966 1967 1968 1969 Current revenues /1 7.3 7.5 7.9 7.5 7.4 7.9 8.1 Tax revenue 6.7 7.0 7.2 6.7 6.7 7.1 7.3 (Income taxes) (2.4) (3.1) (3.4) (3.1) (3.3) (3.6) (3.7) Current expenditure 5.1 5.9 6.2 6.3 6.1 6.4 6.5 Current savings 2.2 1.6 1.7 1.2 1.3 1.5 1.6 Current savines in billions current pesos (3.3) (3.6) (4.3) (3.3) (4.0) (5.1) (5.8) /1 Excluding taxes collected by the Federal District and private contri- hutions tr Soial Security. Source: Ministry of Finance. 57. The fiscal performance of the Federal Government improved slightly in 100 and 1969 with public savings reacning new lighs fo te dCcU in current terms in spite of a rapid expansion in current expenditures (15.4 percent growtn in 1900, 12.9 percent growth in 1909). This imfprovement was largely the result of the built-in elasticity of a fairly progressive income tax system. In addition, an administrative change in 1967 subjecteU greater portions of wages and salaries to income tax withholding, and in 1968 there were a series of minor changes in tax rates which led to slight increases in revenues. 58. The tax and savings performance of the Federal Government, however, leaves much room for improvement, as the ratios in the table above show. The impending change of Administration makes it likely that no tax reforms will yield significant revenues before the second half of 1971. In parti- cular, the value-added tax, which was originally scheduled for enactment in 1969 has been shelved by the present administration, and there is no indica- tion of the incoming Government's intentions in this respect. Similarly, the favored income tax treatment for agricultural incomes and for all forms of property income continues, with no indication of a change in policy. The public sector savings growth continues to lag behind investment expansion. A possible alternative to increased taxes is restricted growth of current government expenditure to increase public savings. However, the scope for action here is probably limited since current expenditure is a very modest 6.6 percent of GDP and public services should probably expand considerably, particularly in the rural areas. On the basis of recent performance, there appear to be strong forces at work against current expenditure restraint. Wages and salaries have increased by nearly 12 percent in 1969, primarily because of increases in wage rates in defense, education, communications and transport. The new labor law will probably exert further pressure on wages in 1970, although the direct effect should be small. Current trans- fers to the social security agencies will increase in the future as the coverage of the program is expected to expand rapidly. Federal District 59. The Federal district has generated savings on current account con- sistently throughout the decade, with savings about one-fourth of Central Government savings. Except for 1964, the Federal District supplied a consider- able surplus of savings over its own demand for investment funds until 1966. In that year it still financed practically all of its own investment. Since 1967, however, with heavy investments, particularly in the subway system, the Federal District has become a large net demander of funds in spite of continued improvement in its current account position. Thus instead of alleviating the investment-savings imbalance of the rest of the public sector, the Federal District now aggravates it. Given the concentration of income and wealth in the capital, it should be possible to generate greater revenues through con- ventional tools of municipal finance, e.g. property taxes, urban service charges progressive water rates, etc. MEXICO PUBLIC SECTOR FINANCES NON-BORROWED FUNDS AS FRACTION OF INVESTMENT 2 .5 ------ - - - -... 2.4 - 2.3 - 2.2 - FIEDERAL - .,.....m -...... GKOVERNMENT 2.1 - FEDERAL D'1STRICT - - m m m a . . . 2.0 - - - ------- --.- .- . -- - - . (MEXICO CITY) 91 DECENTRALIZED AGENCIES . . .. . . TOTAL PUBLIC SECTOR .. .6 - 1.3 -- 9 --p 7 .6. .5. .44 .3 -- 4 - 27 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 2RD - 4972 - 23 - FEDERAL DISTRICT FINANCES (billion pesos) 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 Current Revenue 1.4 1.6 1.7 1.9 2.1 2.2 2.6 2.8 3.2 3.5 Current Expenditure 0.6 0.6 0.7 0.8 1.0 1.1 1.3 1.4 1.6 1.9 Current Surplus 0.8 0.9 1.0 1.0 1.2 1.2 1.3 1.4 1.6 1.6 Investment 0.5 0.4 0.7 0.8 1.3 1.0 1.3 1.8 2.7 4.1 Saving Surplus + (-Saing (.n_1 OS 0.5 A 0 n309 -0.1 0-7 - -0-4 -0_9 -2-5 Source: Ministries of the Presidency and Finance Decentralized Agencies 60. The Decentralized Agencies can be divided into two groups. The first group generates substantial savings and includes Pemex and the power sector. The current account surplus of these agencies (after taxes but ex- cluding depreciation from expenditure) is fairly large, of the order of 4 billion pesos, and has remained roughly constant since 1965. As a percent of GDP the investments of these agencies rose from 2 to 2.2 percent while their current surplus dropped from 1.5 in 1965 to 1.1 last year. This is mainly because Pemex diesel and gasoline prices have not increased during this period, while current expenditure went up considerably, partly as a result of rising exploration costs. A recent comprehensive study of the transport sector leads to the conclusion that an increase in diesel fuel prices is warranted to avoid subsidization of diesel users. As a group, the remaining decentralized agencies contribute very little to savings, and they absorb about 7 billion annually in Federal Government transfers. The railroads, with 1969 transfers of nearly 1.5 billion pesos, the social security system (1.8 billion pesos) and the agricultural price support agency CONASUPO (1 billion pesos) are the most important. Among them the railroads show the only widening deficit; it has doubled since 1965 and risen by one-third in 1969 alone. The Government is reviewing its railroad policy at present. To keep the railroad deficit from widening any further in current prices would seem to be a feasible minimum objective. C. Planning and Investment -Planning o0. AlthougH there is no overall planning mechanism in Mexico, close coordination has been gradually established during the 1960's between the Ministries of the PreUuiency, u Finance ade tne GCentral Bank. Since 1967 the Ministry of the Presidency has exercised powers to coordinate and authorize all public sector investment and, Jointly with the Ministry of Finance, formulates annual public investment plans. Investment requests are sent to a joint Presidency-Finance committee, usually about six months before the fiscal year starts. The spending agencies' requests are screened by various working groups who submit their recommendations to the joint commit- tee. The latter establishes priorities among agencies on the basis of Presidential guidelines within the limits of available financial resources. Priorities are ultimately reflected in a plan financiamiento-inversion that is usually completed during the first quarter of the fiscal year, and in specific investment authorizations for each executing agency. Historically the committee appears to have restricted the expenditure of agencies relying largely on Government funds more successsfully than those of agencies with substantial revenues of their own. In the case of larger projects, authori- zations are on a project-by-project basis. 62. Some control over investment is also exercised by the Finance Ministry through external borrowing authorizations. These authorizations, without which no external borrowing can legally take place, are usually granted on an annual basis at the beginning of the fiscal year, in consulta- tion with the Bank of Mexico and the Presidency. In practice, the degree of effectiveness of control varies among agencies. Some large agencies such as Pemex which themselves generate substantial sources of finance and have thus gained considerable de facto autonomy in borrowing decisions, are often granted fairly large additional borrowing authorizations in the course of the fiscal year. In these cases the agencies in fact usually determine their own level of external borrowing. Hence, in the past external borrow- ing authorizations have not been a fully effective tool for expenditure control. This is serious in view of the high levels of public sector external indebtedness already attained, and the need for effective control over further borrowing. 1/ 63. Until 1970 certain executing agencies have spent more in invest- ment than had been authorized by the Ministry of the Presidency. A new budaet law provision was introduced last year, effective as of January 1. 1970 which states that unauthorized investment expenditure will no longer he recogni7td as nublic debt. This is expected to deter contractors from financing part of public works in advance. 1/ A recent decree restricting the scope of public sector external borrow- ing, analyzed in Chapter IV, represents a step In the direction of ti-1 ter Gov.ernmen t con L rolI ove r hor row I myby the de re~nt raIi -uod :q,viiit I ! - 25 - 64. There is still much scope for further improvement in public sector planning, both at the sectoral and at the overall levels. The planning work of executing agencies needs strengthening. Even in the most efficient agencies, project preparation is generally carried out with primary emphasis oin excellence from an engineering point of view. However, priorities among proiects in any one sector or between sectors cannot be readily established because standards of economic analysis vary greatly, even within specific agencies. For example, the standards of proiect preparation for submission to international financing agencies are much higher tn average. Even with- out attaining the international agencies' standards in all cases, it would be highly desirable, particularly for the larger projects, to have a basis for rational economic priorities. This would require an effort at the level of most executing agencies. Such an effort at project-level planning could make a substantial contribution to allocative efficiency in the public sector. 65. There is also room for further improvement at the overall planning level. Thp effort. of thp Ministry of rhp PrP.idPncv and the Finance Ministry have already produced good results in terms of keeping overall nithlir invPctmPnt lve1c rlo fn n1lnned nhietives Tmnrnvpd cnmmunicntions between executing agencies, particularly the decentralized agencies, and the twn miniqtript' ment-ind nuldlr holn ; ornt- tIPnIl in fvrthpr imnrnvina nInn- ning and matching resource mobilization efforts and external debt management 66. Although no official medium-term investment program 1s avlbl,I a rough estimate of minimum desirable orders of magnitude is attempted below, expected Governmental priorities. Although the new Administration may well 4-CCLL *LCt. Li ~C.LL.t.CL Ct. ULO LL~CC L Lr CLY LL&Mt. L.LLC total resource needs during 1970-1976 will be at least those shown in the the point of departure. Agricultural investment is projected to increase at twice the poultion growth~ rate after 1070 This would be in accordance with the need to step-up investment in the poorer rural areas while at the same L~LUL a timeLI LUtnu n to j A. Uro th L aarg St~L cLeC irr 6aio S.L£,ULUL CLLtemtes. tiCVCU ment in power and steel represent minimum levels required for further rapid gr wLl. ALUC A.IU CLLUL L L UU LLI L.d I A.U.LC LC4 LULpLA tL&JLc1 vestment projections have also been kept at a minimum and would represent a slowudown in comparison with past data. Any further cut would be reflected in some degree of deterioration in education and public health standards. ITe projections uo not allow fur a substaLial expansion or tne Mexico City subway system, nor for initiating any new subway system in other towns. Total public investment would represent about 6.4 percent or Gur, assuming a 6 percent growth rate of GDP in real terms between 1970 and 1976, or about the same share as between 1964 and 1969. Since public investments were pro- jected at relatively low levels, there is little slack in the system for rapid acceleration in any Government investment program. More rapid improve- ment or cost overruns in education, for example, would require additional funds; there is little possibility for cutting back programs. - 26 - POSSIBLE SHIFTS IN PUBLIC INVESTMENT ALLOCATION 1969 1/ 1970 2/ 1971 1972 1973 1974 1975 1976 Total LI.5 30.2 L.27. 28.3 31.0 3.2. 35.J. 37.1 Agriculture 3/ 3.0 4.0 4.3 4.6 4.8 5.2 5.6 6.0 Power 4/ 3.2 4.1 3.3 3.5 3.6 4.0 4.3 4.6 Pemex 5/ 5.2 5.4 5.0 5.0 5.4 6.0 6.5 7.0 Steel 6/ 0.9 0.7 0.4 0.4 1.4 1.4 1.4 1.4 Other Industrial 3/ 0.7 1.0 1.1 1.2 1.2 1.3 1.4 1.5 Telecommunications 0.4 0.9 0.7 0.7 0.7 0.7 0.7 0.7 Roads 7/ 2.9 2.6 2.8 3.0 3.0 3.3 3.5 3.4 Railroads 7/ 1.7 1.9 1.9 1.9 1.2 2.0 2.0 2.0 Ports 7/ 0.4 0.4 0.4 0.4 0.4 0.5 0.5 0.5 Airports 7/ 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 Federal District 8/ 4.8 4.3 2.0 2.1 3.0 2.5 2.6 2.8 Housing 9/ 0.3 0.3 0.4 0.4 0.4 0.5 0.5 0.6 Public Health 3/ 1.1 1.1 1.1 1.2 1.3 1.4 1.5 1.6 Education 3/ 1.5 1.5 1.6 1.7 1.8 2.0 2.1 2.3 Other 0.7 1.3 1.4 1.5 1.4 1.7 1.8 2.0 1/ Realized investment, Presidencia data. 2/ Programmed investment, Presidencia data. 3/ 7 percent rise per year. 4/ From 1971 onward, Power Sector plan. 5/ Based on plans for exploration, refineries, transport and petrochemicals. 6/ Including Las Truchas complex. 7/ Source: IBRD Transport Mission. 8/ Includes new water supply project. 9/ 10 percent increase per year. Source: Presidencia and mission estimates - 97 - D. Financial Projections '7J. T'k e 4. 0~ 1LLJ Iow nA5 L -le cWal cuatedLC onL Lte I- is o f 1-1. cal - n suggests that, without new public revenue measures, public sector savings w-.1.4 nauy A e e s e w c now anu 1 )7;, -A w 'Ax Ae xcl,n ouvoco-un4 ex relative to GDP. Since public investment has been projected to increase roughly iL sLCp WiLi U G LUK soCL aso11tinmum CLUIL anU soial CqulreAC ments, the outlook for financing would present serious cause for concern. UlCDs signij.LLIL n1CW CVCIUC mieasur e 1s LMAC Lar tLacaeC tuoSIJ L S.tuS savings, net financing requirements -- i.e. needed net foreign and domestic I- J IQ'7 1 1., n7) . UULLUWinl -- wuUu Lise LLUIL aUUUL 1L b1lliULI pesUs Ln L1A aLU 171L LU0 about 20 billion pesos in 1975 and 1976. The share of public investment that would have to be financed by public sector borrowing -- dolestic and external -- would increase from about 45 percent in the first two years of tne new Administration to some 55 percent in i9,o. Hence, in te ausence of new revenue measures, even the minimum investment program set out in the previous section would entail a considerable deterioration in the pattern of financing. Clearly, should the new Administration wish to carry out a more ambitious investment program -- e.g. in rural development and education -- the financial strains would become even more acute. - 28 - PUBLIC SELTUK FINANLING KEQUIRETNIS FPUJElIUNS ON THE BASIS OF HISTORICAL TRENDS (billion 1970 pesos) 1970 1971 1972 1973 1974 1975 1976 Public Investment 1/ 28.6 27.1 28.3 31.0 33.2 35.1 37.1 Central Government Current Surplus 6.8 6.8 7.2 7.4 7.5 7.7 8.0 Central Government Current Revenue 2/ 34.1 36.3 38.7 41.2 43.9 46.8 49.9 Central Government Current Expenditure 3/ 27.3 29.5 31.5 33.8 36.4 39.1 41.9 Federal District Current Surplus 4/ 1.7 1.8 1.8 1.8 1.8 1.9 1.9 Major Decentralized Agencies: Current Surplus 4/ 5.7 5.7 5.7 5.7 5.6 5.5 5.4 Other Decentralized Agencies: Current Surplus 0.8 0.8 0.8 0.8 0.8 0.8 0.8 Total Public Sector Savings 15.0 15.1 15.5 15.7 15.7 15.9 16.1 Capital Revenues 0.2 0.2 0.2 0.2 0.2 0.2 0.2 Financing Requirements (net) 13.4 11.8 12.6 15.1 17.3 19.0 20.8 Public Sector Savings (percent of GDP) (3.6) (3.5) (3.3) (3.2) (3.0) (2.9) (2.8) 1/ 1970 fieures from Finance Ministry plan. After 1970 investment figures on the basis of requirements outlined in Section C. 2/ Assuming elasticity of 1.09. 6 percent GDP growth rate and no new revenue measures. 3/ Current erpnditure less interest nrojected at 1963-69 orowth rate in real terms. Interest on old debt projected at 1969 level; interest on n--- det o 1969 and beynd i alculatedl asuming net borrowing to increase by 6 percent per year; interest: 8.5 percent. 41 Crrn r..------enues and expeditre growing at the 1963-69 rate. Implies no change in pricing policies, public service charges, etc. Source: Ministry of Presidency and Mission estimates. - 29 - 68. Because of the high level of external indebtedness already reached and the dangerous consequences of substantial further indebtedness. net external borrowing should be kept down to the minimum level required to meet balance of naympntq con1*nintR. This 1PvP1 will he determined by the current account deficit of the balance of payments and by the inflows of nrivate canital from bvrnad. Tn the absence of significant nPw revenue measures, net external borrowing requirements would average some 5 billion neSoS nr year (US$400 m.114n1 beteen 1Q70 and 1976. Such l1Al nf borrowing entails the probability of a rapidly rising debt service ratio -- fr23 percent in 197 to about 33-34 percent towards the -en o~f the new Administration's term of office. 69. This debt service ratio could, however, be significantly reduced *il~~ .L~ LId L iJU ..LLLLL =Ctit FUU.Li L- .-jtffL £UL CV LSL WLL .. ~~C growth of private consumption. If new revenue measures are carefully de- signed, sU LldL IllUs L UKe Lipl saig iUULre isVillh alll heL LICAgeIOC Of private consumption, the debt service ratio could probably be maintained wel Uelow 30 percent. In order to achieve this, additional public sector revenues of the order of 4 billion pesos would probably be required. The financi g projections set out in tne next table show two alnLves ior public sector savings and borrowing: one that is based on historical revenue trends and implies no new revenue measures, and one that implies new revenue measures of the order of 4 billion pesds. 70. The projections also show a need for rapidly growing amounts of domestic public sector borrowing, especially toward the end of the new Administration's term of office. So long as private domestic and foreign private savings channelled into the banking system continue to increase at the fast rate of the last few years, this need not be inflationary and would not affect private sector expansion significantly. It is extremely ditticult, however, to project these savings with much precision, and the Mexican situation is further complicated by the relatively important role of the flow of savings from abroad into the banking system. As the viability of the domestic borrowing component of the financing pAttern in the absence of new public revenue measures is predicated on the precarious assumption that banking savings will continue to increase about as fast as in the recent past, the external borrowing required under alternative A on the following table may be even larger than the amounts shown. ALTERNATIVE PUBLIC SECTOR FINNICIG PROJECTIONS (billion 1970 pesos) 1970 1971 1972 1973 197h 1975 1976 1970-1976 Average rate A. ALTERNATIVE ASSUIING NO NEW MAJOR REVENUE MEASURES Public sector savings 15.0 15.1 15.5 15.7 15.7 15.9 16.1 ( .2) Net financing requirements 13.h 11.8 12.6 15.1 17.3 19.0 20.8 ( 7.6) Net domestic borrowing 9.L 7.2 7.7 10.0 12.1 13.8 15.9 ( 9.1) Net external borrowing h.O k.6 4..9 5.1 5.2 5.2 L.9 3.L) Amortization (external) 7.0 6.2 7.9 10.3 11.8 13.6 13.6 ( 11.7) Gross external borrowing 11.0 10.8 12.8 15.b 17.0 L8.8 18.5 ( 9.0) Debt service ratio (f) 23.5 23.7 26.7 31.0 32.6 34.3 32.7 B. ALTERNATIVE ASSUICNG SIGNIFICANT NEW REVENUE KEASURES Public sector savings 15.( 18.6 19.2 19.6 19.9 20.3 20.8 ( 5.6) Net financing requirerents 13.. 8.3 8.9 11.2 13.1 L'1.6 16.1 ( 3.1) Net dorestic borrowing 9.,, 6.0 6.h 8.6 10.5 12.0 13.6 ( 6.L) Net external borroing L.0 2.3 2.5 2.6 2.6 2.6 2.5 (- 7.5) Amortization (external) 7.C0 6.h 7.L 9.1 9.5 11.3 9.7 ( 5.6) Gross external borrowing 11.0 8.7 9.9 11.7 12.1 13.9 12.2 ( 1.7) Debt service ratio (f) 23.5 23.7 25.2 27.5 26.8 26.9 2L.2 C. ADDITIONAL PLTBLIC REENUES REQUIRED FUR ALTERNATIVE B 1/ 3.5 3.7 3.9 .2 .L b.7 ( 6.0) 1/ Assurming, that 2/3 of new revenues c:rie out cf private ccn;numpticn and 1/3 out of nrivate -vings, and assuming that the overall savings rate of the econory tncreases. Source: Mission estimates. - 31 - 71. The preceding analysis suggests that about 4 billion pesos addi- tional revenues per year would be required between 1971 and 1976 to main- tain the debt service under 30 percent, and it seems well within the power of the incoming Administration to raise public sector savings by the re- quired amount -- from about 3.1 to 3.8 percent of GDP. While far from neiligible- thp rpnuired mtnnurp, wnuld hav fn vild only ahonut 5 0ercent in additional revenues for the public sector as a whole; since part of the rpnnirtd e v nou nichr woll h nhtnhrninod hv urtfilina cnmp rirrPnt exnpn- ditures -- e.g. in the railroads -- the required growL1b of revenue might hp even qmaller_ Naturn11v if all the maonuro were onnentrated on raising the taxes of the Federal Government, the percentage increase in- AMol7ved - - over 10 pret -.4 aight- apea e.cess.. I n fact, honweveor, as already noted, part of the additional savings could -- and probably should -- be mon b ilizeA by, the ee rlzd -aece an.~. ,A by,l~ the Fed 1 niatf-rif-t- The following list of some major possible actions to raise public sector Savings is far fr-om ex-hau.,-stive; ist mer.' dem.onstrats- f-1-1- f-l-o r4r.nMli1 Administration has a wide range of choice, which supports the presumption that no insuperable technical or economic obstacles are likely to prevent action of the magnitude required. 72. Federal revenues could be increased substantially through further improvements in enforcemente Tax VaIoLn remaLUin VeLy AigL, patiuuarly outside the Federal District, and much could also be done to improve the efficacy of customs duty collections. Improved enforcement would be great- ly facilitated by a shift from the existing sales taxes to a value-added tax system. Lexican auth[rities nau planned to introauce sucI a system in 1969, but the decision was postponed for action by the incoming Administration. Apart from tHe favorable revenue effects of the value-added tax itself, the proposed system would yield secondary benefits inasmuch as, through compu- terized data processing, it would provide basic information to the Government for a more effective enforcement of the other major taxes. However, a switch to Lhe value-added system would require an improved and strengthened tax administration because it is a more complex levy than the mercantile tax now in effect. As an alternative, consideration may well be given to a single stage sales tax at the manufacturing and/or wholesale level. This tax poses fewer enforcement problems than the value-added tax and avoids the cascade effect of the present mercantile tax. 73. A series of more gradual -- but nonetheless important -- changes should also be considered. In particular, exemption of 40 percent of agri- cultural income from business income taxation seems inequitable in the case of large, prosperous enterprises. Nor does there appear to be much justi- fication for exemption of agriculture from the turnover tax. Unearned in- comes are also treated extremely favorably under the present tax system, and the adequacy of a policy which inordinately favors capital income may be questioned. Furthermore, some of the benefits accruing to the private sector from public expenditures in urban areas could be captured through improve- ment levies, higher property taxes and more frequent reassessments. Finally, since much of the recent rise in external indebtedness has stemmed from public sector decentralized agencies, the Mexican authorities might raise - 32 - the prices for the products of decentralized agencies where this is econo- mllv annranllat Snprifiralv- the onrice and rates r-rutrtirp nF Ppmov and of the railroads need careful evaluation. 1/ A combination of these revenne measnres cnla ransonah1v he expnrted- thronoh itQ fEnunr2bl effect on overall savings and on the external resource gap, to maintain the aternal nuhlic debt service ratin well hplnw '4O percent. 7A Tn the conteyt nf Mpvirn' heavy reliance nn nrivnrp aetony mnt- vations for savings, investment and foreign capital inflows, it is important tht the revanue maeurec he undertaken annn I Unda delay mlgh tn ellceife1 a situation in subsequent years in which the magnitude of required action unld be uch __ Fb hava A1arantive effSctU anot,rnal IraAn and oet investment. On the other hand, prompt action by the incoming Administra- #- onwoldbe--- conistntwit th gdulit appr--- 11-hat has0 main- tained the private sector's confidence in the past. 1/ One conclusion of the recent IBRD Transport Sector Mission to Mexico in that a Auhtanrial increaqp in the prire of diial fual is wasrrated to correct the present subsidization of diesel fuel trucks, and that an unward adj,-,stment in1 Some~ --ail--' rae - 33 - III. CREDIT, PRICES AND WAGES A. Money and Credit 75. Noney and credit developments during the last year were strongly influenced by the international money markets. In previous years the domes- tic banking system was able to attract savings from domestic and foreign sources with the aid of relative price stability and a reasonably constant set of interest rate differentials -- of 2 to 3 percentage points -- vis-a- vis the international capital market. With the sharp upsurge in world interest rates in the second half of 1968 this climate began to change. For- eign money markets stepped up competition with the Mexican banking system for domestic as well as foreign savings. During the first half of 1969 the relative advantage of Mexican financial yields eroded and as a result, savers became more reluctant to place their funds at the disposal of the domestic banking system. This was, of course, facilitated by the ease with which funds can be shifted in and out of Nexico within the framework of full convertibili- ty of the peso. In June and July 1969 the monetary authorities took various defensive measures, among which increases in key interest rates were the most important, to stem the outflow of funds and restore the relative yield advan- tage of 1lexican financial instruments. As a result of these measures and of the quieting down of the Euro-money markets after the French and German parity adjustments, the Mexican monetary system was able to attract 18 percent more funds last year than in 1968. This strong increase in the banking system's liabilities supported a 20 percent credit expansion -- after one of 15 percent during 1968. 76. The following table illustrates the changes in deposit interest rates: MAXA1MU1N AULHURILL ANNUAL YiLDS UN EtLEUTD BANK LIABILITIES BEFORE AND AFTER THE JUNE - JULY 1969 MEASUKt 1/ (In percent) Before After 1. Financieras Promissory notes (of 1 million pesos or more) in domestic currency 9.00 11.00 In foreign currency 8.00 10.00 Financial certificates of deposit (11 and 12 years) -- 11.00 and 12.00 Financial bonds 8.73 9.00 Special mortgage bonds (5 years) -- 9.60 Mortgage bonds (of 1 million pesos or more) 8.00 11.00 1/ Net of tax withholding. Source: Bank of Nexico. - 34 - The principal measures taken last year, by type of institution were: (a) Financieras: (i) increase of 2 percentaE- points in the mavimum Intret raes payable on hr ph-nntin natpon nrcmc - sory notes; (ii.) authorization to introduce a new high-yielding gort.4no-. te dep~ ositc, n-t-unment w.,i t,-nP, tr-;e ot f 11 .-nd 12 years; (iii) temporary permission to pay a premium interest ~~~~f; , *h rza- new 5It~ L £0~ -year bond with an effective interest rate more than 1.5 percentage authorization to accept conversions of outstanding mortgage rates 3 percentage points higher than the old bonds, for one -t7 1 uh combination oV' t1ne 'Mexcan u-Iftnlve msuresc and th, qui C C A-e g! down of international money markets returned the financial system to an in previous years, by the financieras and the mortgage banks. Total private Sec _L L L L A L .L UICe UMLMLrt4SL6 oYMICLH11 L CCOCM U LJY FCLt1.LIL \ML Zkj.* billion pesos) last year. The higher interest rates resulting from interna- tLoUala UCVCUp11LLmLs LVC IUnL, OU adL, LdU any seLiUUs LidUi CL LCLs o1 the economy. The Mexican authorities have put a ceiling on the bank's issue of promisUry notes a ftw y%kLb 4VU LU tmuruage [tf LIIULhnt:1ing U 5av1Ug into less liquid financial claims, and introduced a new instrument, the financial certificate of deposit, with maturities ranging from two to ten years, which the banks could make available to savers but which were not to be repurchased at par on presentation. However, with the mid-1969 removal of the limitations on banks' issues of promissory notes, the growth of holdings of financial certificates by the public had come to a virtual halt. 78. The strong expansion in the banking system's resources enabled it to support a 20 percent increase in credit (29.5 billion pesos) last year, of which about 70 percent went to the private sector and the balance to the public sector. The financial institutions expanding credit most rapidly were the financieras, which increased their growth rate from an average of 27 per- c,nt over the three-year period 1965-1968 to almost 30 percent last year. This reflects the great ability of these private investment companies to raise funds through issuing securities to the private sector. Private com- mercial banks have also expanded their lending operations at an increased rate (over 15 percent compared to an average of 12.2 percent during the three previous years). 79. Industry and commerce have had the greatest recourse to financing by the banking system. The two sectors combined accounted for about two- thirds of total banking system financing. While total credit to industry in- creased by 20.1 percent (compared with an average yearly increase during the previous eight years of 15.4 percent) and to commerce by 29 percent (previous - 35 - eight years increased 14.2 percent annually) agriculture and livestock only had an increase of 5.4 percent over 1968 as against an average annual increase during the previous eight years of 13 percent. Although credit to agricul- ture increased rapidly in absolute terms, there is evidence of a constant decline in banking system financing of agriculture from 14.6 percent of total financing in 1960 to only 9.7 percent in 1969. Despite the fact that agri- culture has additional, non-banking system credit facilities available, this development is a serious cause of concern. These facilities, amounting to about 500 million pesos in 1969 come from the Fondo de Garantia, a Government trust fund administered by the Bank of Mexico, which operates with resources from the Federal Government and from international agencies. Even taking the additional 500 million pesos into account, financing of the agricultural sector as a percentage of total banking system financing still accounts for only about 10.7 percent, down from 14.6 percent in 1960. Possible means for altering that trend could be the introduction of addditional portfolio require- ments, the requirements for banks to hold a larger part of their reserves in the form of agricultural bonds, the alteration of the banking law that limits the guarantee on loans given by the banks to agriculture, and a possibility of tying the portfolio lending of private banks for agriculture to the access of these banks to rediscounts in the Bank of Mexico. 80. Durine the first few months of 1970 the monetary situation has continued along the same path as in the second half of last year. The banking system has continued expandinv its resourre at ahout the same rate as in 1969. Credit policy has remained essentially unchanged and an expansion of credit of the order of 1I nprcpnt iq enviqnad for the full year. The Mexican authorities intend to continue to observe developments in international money markets loelv and will n in the nat make aiiQtmentQ in rce of a change in the structure of international interest rate levels. Unless external nressurese hcome too strong the nthorities n not envisage chanoing their basic monetary policy. Owing to a projected increase in the financing gap of th pblI secor,the Bnk1 of 74-i- co- mafhvet finace 7.1 billion peos or about one billion more than in 1969, through purchases of Government secu- rities (nassed on to hankQ in reerv.e renviiremnontc), Tn additIon, nmj billion pesos may be financed directly through bank loans. This transfer of fundq from the banking svtm to tha nulic cAitor n1se n decisive rnol, an it fills nearly half the public sector financing gap. Borrowing from the Cpntral Rank Anoc nent roant rcl-annnont nhlioienc ftnv- i thC Emernmont al thouch it does add to future interest payments. This year's increase in Central Bank financing chnold nn nrecent inflationary nrhloms if the rnaxcted continued large increase of private savings held in the form of money materializes. It may, howover, innvo n clhift in the invement of Cenral Rank credit from the private to the public sector. This is consistent with an expected slight slowdown In the rate of growth of CDP. B. Prices 01 nJL I- A~0~ LJ UL. I. byL~L aL~ ~LW~~ I1LUU number of supply problems for agricultural products, mainly owing to the droughtL, to a rise inL the~ pice o imports ad to wage iceases. it Iis un- likely that monetary developments have contributed substantially to the in- crease in prices. Despite the Large inflow of funds into the baning system, which created a high degree of liquidity, the monetary velocity continued the decline of recent years. Price trends in 197/0 are liKely to continue some- what above the average of the last decade, owing mainly to import price pressures. Furthermore, a continued drought in some areas of the country, an 8 percent increase in some steel prices in January 1970 and some wage-bill increases in connection with the new labor code should afrect prices this year. Price increases of about 5 percent seem unavoidable in Mexico this year, but given the prospects for continued inflation in the United States and other major trading partners, Mexico's competitive position is not likely to deteriorate as a result of domestic inflation in 1970. C. Capital Markets 82. The structure of the Mexican capital market shows a strong prefer- ence for fixed income financial and mortgage bonds. Less than 4 percent of total stock exchange transactions take place in variable income assets, pre- dominantly stocks of private companies and banks. Transactions in private company shares are generally effected between the private banks, which usually hold large blocks of shares and employ their own brokers at the three stock exchanges in the country. Established major private companies with preferred access to particular commercial banks usually stay away from the stock exchange, as it would involve greater publicity of their financial status. Self- financing with the help of their "house banks" still remains the rule for most private and family-owned companies. During the last five years there has been no tendency towards broader share ownership a fact which is reflected in the constancy of stock market transactions in industrial shares. A draft law to revamp the stock market is to be submitted to the Mexican authorities before the end of this Administration. However, it would seem that the major obstacle to the development of a dynamric capital market lies in industrial and banking attitudes rather than in inadequate legislation. While the industrial stock market has not developed rapidly, growth in the fixed income assets market has been outstanding. The growth of bonds transacted during last year alone amounted to 29 percent, with a volume reaching 33.9 billion pesos. as against 5 billion pesos in 1960. D. Labor 83. Mexico's employment situation is hard to assess because of the dearth of meaningful statistics. A new labor code has gone into effect on May 1, 1970. In the main, the code is aimed at improving the economic condi- tions of employees. It does not affect the minimum wage legislation. The main provisions are some increases in fringe benerits and overtime, and a new obligation for employers of 100 employees or more to provide housing for the latter. This obligation does not take effect immediately, however, and will be worked out within the next three years. The impact of the new code on prices is expected to be gradual and relatively small, since many large firms already provide their employees with the code's new requirements and small firms will not be subjected to the housing regulations. The fringe benefits, which include improved overtime and vacation regulations, are not expected to have significant inflationary effects either. - 38 - IV. BALANCE OF PAYMENTS POLICIES AND PROSPECTS A. Balance of Payments and External Debt 84. Mexico's balance of payments on current account reflects many of thp fundamprnl nroblems confronting thp economy. Tht ctirrpnt ncri-ntint dpfirit which amounted to about US$200 million, or 1.8 percent of GDP, during the P,rlv 1W)'Q (1960-62 avprace) reachd abouir ISS70( millionn- or 2-5 nprrpnt of GDP, during the last years of the decade (1967-69 average). The most imnirt.ant fnitors in thi; dtrorrion are (a) stagnation of merchandise exports during 1967; this has widened the trade deficit from US$400 million (10AA-fr av rne to 1iSAS million (19A7-A9 nv.rncp* (h the Qtn infrscr at a yearly rate of 14-15 percent of the net outflow of factor income payments; the fasest-rowngn flows have been interest on total nblic evrrnal Aet -- from about US$50 million in 1960 to US$230 million in 1969 -- and private .nvestment prof4ts -- from U$1 1 m4 ion In 190At) toUC7 million in 1069 85. Th currentr A'Ofi ,-i t hna haoi fi nnr,r'DA ,% 1 Vo 4i,F1 -1.1c ,-f f-r- official and private capital. During the last decade direct private foreign X-lvesmn infow --L~L incldin reivetmnt -- have aD '~& &V 5Cou-C C rmillion per year, rising from US$100 million in 1960-62 to US$230 million in ient financing (see Chapter II) the level of net public medium- and long- tern-, eAxtral borrowing rose oud-U g #4- ana.a 9---u -1-um ouvu e clAn -, usia 1- L~LLii~ AL L 1~.L LJU I W LI~ COC CU . L 6 LL11= 0Q5.=C jU .1 LILU111 CLUJUL. IO - +V~ kLL.LJ..LLULL to about US$300 million. Rising net borrowing entails even faster rising rUb rULLWitg 1 LLU o 1ULiL eiTuAUm- and 1ng-erm L LULHA bUorLWi amounted to about US$5.2 billion during the last decade, increasing from U-1 " I linlI Z) to lynoi ',7c M-7 . /~f~ It n' - rl...Li[ IU ~ ~ ~ L ~ ?J k-IU L IXUI1 u:. average'. tAS result, service on public medium- and long-term external debt rose from Udqi.1 mJ1.iion kL:7Uu-V; ILA UQ?U.LO WilL.nUL1 I lYlooO]. LurGer LO increase the net transfer of resources -- net borrowing minus interest -- from US$100 to 111.150 mllion over the last ten years, LexIco 1as hau to more than doube gross annual borrowing as debt service obligations trebled. The accumulated aebt imposes increasingly rigid constraints on the management of the economy. Even if the past growth of direct foreign investment continues and if foreign firms continue to reinvest. in Mexico a substantial portion of their earnings, prospects are that the size of the current account deficit and of debt amorti- zation obligations w:.J.L be such as to require even larger public sector borrow- ing in the seventies than in the previous decade. 86. Gross public external borrowing requirements -- assuming continued rapid growth of the economy -- would amount to some US$7.4 billion between 1971 and 1976 (including those two years), or about US$1.2 billion per year if no major new public revenue measures are taken. Amortization requirements alone would amount to some US$4.6 billion. Given the presently foreseeable flow of projects suitable for official external financing, international lending institutions and foreign Governments may at best be expected to - 39 - provide some US$400-500 million per year between 1971 and 1976. Most of the balance (about USS700-800 million per year) would have to be financed by supplier's credits and credits from foreign financial institutions. Although availability of sunnliers' credits and credits from foreign financial insti- tutions will probably continue, the hard terms implicit in this borrowing nattern will further increase Mexico's already high debt service obligations even beyond 1976. 87. The precise impact on these magnitudes of mezasures that raise nnhlir mqrtor Qnvin,s iq fnr from nprrnin. While on nurPlv nublic finance grounds one can define precisely how much less the public sector would have to hnrrnw Ahrnnd thic will nnlv hP rnnciqtpnrt with n viblhp hlanrp of payments if the higher public savings is not achieved at the expense of nrivnto inirinoc i6 a if it in fnpt irn lrc in nn inovdncg in nqti%nal savings. Actually, of course, no tax incides solely on consumption or sole" nnc ~ings an notonl the- yield k-t +-I,. kind of the revenue measures adopted will determine their balance of payments impact. For incide on private consumption and savings in a ratio of two to one, or LIB U 112 tIUI.t 00V A. QI0 W .. tit 0 UYO L L U L .I U ~ Lt LC t LA. j " I'4 savings. Even this assumption, however, only suffices to define the impact on the current account of the UDdlanCe Uf paymenL, it dos n specify whether the higher national savings result in less imports, more exports or a cUmUitiodLLULl U UULhe In I'texiCU iL WUULU seem ledbUL14UaC LU suppose that on the short-run -- say over 1-2 years -- the main impact will be on imports, but that over a longer periou, Uy i1luenciLg the structure and direction of private investment, exports should reflect an important part o1 Le aaltionaL national -avigs. Since a qunuLLiULation of these effects, at this stage, would be exceedingly hazardous, the dis- cussion below oi the foreseeaue uevelopments of imports and exports is concentrated on prospects in the absence of new revenue measures. Only in [he last section, on creditworthiness, is the net impact of new revenue measures on the current balance -- and hence on required borrowing -- taken accounL U eAlilCitly, UUL CVcii Ll:L: 11 aLLtL111PL Lb 1UdUU LU UbLLLUULt LIl=' effect between imports and exports. Hence the impact of the fiscal measures on the ueI t service ratio is liklb-ely to ve unUerstated anu tuis via Ls Lste greater, the longer the time period under consideration. Merchandise Imports 88. Mexico's problem is complicated by the fact that there exists a very close association between the level of imports and the growth rate of the economy. This is a result of import-substitution policies carried out since the Second World War. These policies have taken the form or import licensing, tariffs, and fiscal and other incentives to keep the import content of Mexican goods down. Industry has responded vigorously to these policies and, as a result of rapid growth and diversification, Mexico now produces about 98.5 percent of the consumer goods purchased in the country. Imports consist mainly in investment goods - although even in this field, Mexico now produces over 80 percent of its requirements -- and fuels and raw - 40 - materials. Consumer goods imports only amount to about 17 percent of the import bill, and consist for about 45 percent in automobile parts; the balance is made up by a great number of different items, chiefly radio and TV parts. 89. During the last decade, between 1959-61 and 1967-69, total imports have declined from 9.4 percent of GDP (in real terms) to about 8.5 percent. The following table shows the last decade's trends by types of imports. MERCHANDISE IMPORTS Tve of Imorts Average Value Percent (million US$) 1/ Change 1959-61 1967-69 Non-manufactured food 14.4 10.7 -26 Agricultural machinery 40.4 35.0 -13 Spare parts 2/ 106.0 138,7 +31 Non-edible non-durable consumer goods 43.0 58.4 +36 Non-manufactured fuels and raw materials 54.6 77.8 +42 Breeding stock and other agricultural investment 11.2 16.0 +43 Manufactured food and beverages 16.6 24.1 +45 Ilanufactured fuels and raw materials 329.6 511.9 +55 Durable consumer goods 135.3 228.5 +69 Other machinery and equipment 307.0 577.0 +88 Construction materials 52.3 100.3 +92 All imports 1,110.4. 1,778.4 +60 Imports as % of GDP (real terms) 9.4 8.5 .J iL" VCJ.LUC UL1 .LLUFUL La .La U=L.J~LCXL7 UY IYpt U _inp r on~J. th basis of~~ U .S wholesale prices (Source: Bank of 1exico and Survey of Current Business). 2/ There has been substantial import-substitution in spare parts in the automotive industry in particular. under incentives provided by legisla- tion setting minimum levels.for Mexican components. 90. Although it is difficult to separate the effects of import-substi- turen fron thnoap f rhAngp. in drmand anq income has rispn. it annpars that substantial import-substitution has occurred during the last decade. It is not easy to asss th trenet tc which the proterein pattern hce ofmintpr for import-substitution trends, because of the great importance of import - 41 - licensing. Some of the trends suggested by the table would be consistent, however, with the widely held view that protection levels increase from raw materials and fuels to machinery and equipment, and from machinery and equip- ment to consumer cnnds Rplntivelv light nrntprtion m;yinst imnort of con- struction materials and machinery and equipment may be associated with the relativP1v rAnid vrnwth in thc-P t-vnpq nf iTmnrtq ailring the last decade, Thp overall level of imports -- 8.5 percent of GDP -- is quite low for a developing economy and suggcts tnoother with the ctructure of imnorts, that imnanrt substitution has already reached a high degree. Therc may be further scope for im-ort-substi4+tio_ 4n capital and 4 ntermediate -odt. There resubs tan- tial import-substitution possibilities in fisheries (see Chapter I). There are serou Ind-AtIons4 -- that Mexico could economically exploit anchovies off Baja California -- present imports amount to some US$14 million and have been required for which funds have not been available so far. It would seem well woLrWhAC l L te GoVeLnmnIIHL LU UnULLdt ake uch a sLuUy as DUUn as p L.* Likewise, there is room for further import-substitution in forestry industries, HULOUAY Lil it:WbLtlL ad.U ULhUeL ptil pUUUL. [UWCVULt WILLI Lit PLCU.LLCUWLv needs for high-technology capital goods imports, there are reasons to believe that the level of imports required for further rapid development will not decline much as a share of GDP. Indeed, substantial investments will be nouULU LL UabC LapacLLy UL UAitLlg iusties, e.g. steel -- enouU LU prevent negative import-substitution. (See also Chapter I.) Moreover, while further import-substitution is likely to occur In the simpler lines of goods -- electric motors, automobiles -- new types of goods will in all likelihood be .UIpULLUU -- LUmpULteLS, LIucea equipment, etc. -- LFIus a LecIlological ro_L- over" takes place which sets a downward limit to imports as a share of GDP, givel a aL1sactory growth rate of the economy. Export Promotion 9i. Because prospects for further overall import reduction (as a share of GDP) seem limited, policies to improve the balance of payments will probably have to focus principally on the export side. Commodity exports have not pro- gressed satisfactorily during the past few years, mainly because of a sharp decline, after 197, in cotton exports. This year's merchandise exports are not expected to exceed last year's level significantly, again because of a drop in cotton exports. Mexico's trade deficit has increased from US$370 million in 1966 to US$630 million in 1969. This divergence between import and export trends suggests a need for more vigorous export promotion policies than in the past. 92. Slightly under 60 percent of Mexican exports have increased relativ- ely slowly (at less than 7 percent per year) between 1965 and 1968. 1/ The following table indicates the importance of these relatively sluggish exports, by sector of origin. 1/ Because 1969 data are not strictly comparable to previous years (errors and omissions dropped sharply in 1969 partly as a result of improvements in current account statistics) the discussion focuses on the 1965-1968 period. - 42 - EXPORT TREND, 1965-1968 Percent of exports Percent of exports rising at less rising at than 7 percent 7 percent or more t-gicuturl.products Processed agricultural products 49 51 Mining products 51 Petrochemicals 69 31 Manufactured goods 44 56 Unclassified exports 100 -- bource: BanK o Mexico 93. While in some cases demand limitations are keeping exports from growing at a faster pace (e.g., coffee, molasses, henequen, etc.), it appears tnat in most cases these limitations are not critical in the medium-term. Thus, exports of cotton, shrimp, mineral products, and nearly half of Mexico's manufactured exports face no severe demand constraint. Since existing export.- promotion mechanisms (including certain fiscal exemptions) have not proved effective enough to narrow down the trade gap, and since maintenance of the. present exchange rate appears to be closely associated with perpetuating a high degree of contidence in the Mexican economy, the idea of direct export subsidies or import duty rebates should be actively considered by Mexican authorities. The present system of incentives is heavily biased in favor of domestic and against export production. The Mexican authorities could try to offset this bias in a variety of ways, and the choice depends largely on the fiscal cost and the effectiveness of the systems. Exporters could be compensated for the indirect taxes and customs duties levied on imported inputs required for export production. A system compensating for the full cost disability would need to be more general than the (very limited) mech- anisms in force now, and provide substantially higher rates, because rebates would apply not only to direct but also to indirect inputs (e.g. imported machinery and equipment). Such a system may prove effective in stimulating exports that have not performed well in the recent past although they do not .ace inelastic demand, and may also help maintain or step up the rate of growth of exports that have been successful in the past. 94. In the agricultural sector it seems doubtful whether any flat export subsidy should be introduced before the present pricing structure has been carefully reviewed. Existing studies suggest that CONASUPO price poli- cies tend to encourage farmers to grow crops for the domestic market rather than for exports. Although a variety of factors were involved in the US$50 million decline in cotton exports that occurred after 1966 (see Chapter 1), the decline was closely linked to -changes in CONASUPO support price poli- - 43 - cies. 1/ The past has shown the great Government influence on cropping pat- terns and output in the irrigated districts. Thus, the Government was very successful in promoting self-sufficiency in major food crops during the early 1960's. The effectiveness of past policies augurs well for the chances of success of a concerted set of Government actions to encourage farmers to row expnort cronp. 9S Mo-'s F4sharin c-tonr entald also ernne-r1~iuti subantiallyv to improving the balance of payments situation (See Chapt.r I). In the Pacific Cnrt shrimn fishery hAq hopn hamnpred hv Gnvernment rPn1nntion. qptting a rigid ratio to divide the catch proceeds between boat owners and fishing rnnnPr.qtuc, Thc-rp iq furthermnrp, cnr,nrnl lnrk nf medium- nnd lnnc-tprm credit to the private fisheries sector, which constitutes a major restriction toi crnanc-inn nF productIon and exports. 96Tn the mntfnrtityino scor,r w 41aensme ev-norts have risen ant hig7h rates during the past decide, there is a very broad scope for further expan- zinn- The-refnre c-iirevina the meoctvin nf i en -t,ive t-n i",ti.n rinl wrn%nrt deserves high priority. Little is known about the origin of industrial exports, the oaunes env relat-u fzi lure of v4ctino ficl-1 ncent-ve sand the lvel of remuneration expected by entrepreneurs in order to focus on export product- ion. Choices such aso the level1 of compensation necessa-r to ac-H-eve certai. export objectives need to be carefully examined in the light of the fiscal implications. Tax rebate mightFWt rovid -fjJ, -. -tJJ.A -J - with further benefits provided by the rebate of customs duties. Correspond- ingay, aexcoAcA u u aLLU Lu *VLc,u LLLUa= LZ^ LVaLCcO WuL.L l noV LIMJL. y- effective in stimulating exports. In any event, no export incentive scheme can UC LUosiUCLCU 1n isUOLU 1 LAIC L' C VCUC meCaULC sCCUCU LU fnLance it. Apart from export subsidies the Mexican authorities might consider examLlg116- an exCenion o 0 e automouile inauS-t legislation kLy.ug LiCen1t to import to export performance) to other industries, and action through the reserve requirement of tne oanking system in favor or credits to exporters. LourA.'sm I. rulicies to uevelp Lurism further coulu al5u contribute aecisively to ameliorating the balance of payments situation. Last year tourist receipts only Lucrta5ea by 7. percent and frontier transactions Dy 4.3 percent, much below the historical trend. The slow rise in tourist earnings can be partly attributed to tne nign level reachea auring the 9oo ulympics, and partly to factors on the supply side. Operation Intercept largely explains the sudden drop in the growth of border transactions and it has also contributed to slowing down tourism earnings. Tourism remains the single most promising field in which to achieve a rapid and sustained increase in foreign exchange earnings. The opening up of Acapulco to foreign air carriers was followed by an unprece- 1/ In 1966 CONASUPO established a price support for sesame, safflower and soybeans; this made it more profitable for farmers to grow grains and the above-mentioned crops in double-cronning natterns than cotton, which does not lend itself to double-cropping. - 44 - dented investment boom in hotels and by a sharp increase in the number of tourists. The same approach could prove successful in stimulating growth in other resorts. Promotion of cheaper air fares between the U.S., Canada and Mexico, greater use of charter flights and encouragement of package tours to appeal to the less affluent tourists can all contribute to a rise in tourism earnings. Mexico does not only compete with beach-based tourist resorts in the U.S., the Caribbean and Hawaii, but also with cultural tourism from the U.S. and Canada to Europe. The relative cost of tourism in Europe and Mexi- co will become increasingly.important as trans-atlantic tourism becomes cheaper and more popular. This competition again points to the need for more good quality medium-priced hotel accomodations. Although the outflow of foreign exchange caused by Mexican tourism abroad has increased at a rapid rate during the last decade, it is expected that there will be a gradual slowdown as the absolute number of Mexican tourists increases. Eventually, growth rates for receipts from foreign tourists in Mexico and for outflows on account of Mexican tourism abroad may stabilize at about the same level. Private Capital Flows 98. Direct investment inflows now reach a level of US$250-300 million per year, about one-half of which consists in reinvestment by foreign firms in Mexico, and oue-half in new investment from abroad. The income generated hv direct private foreign-owned canital flowine out of Mexico now amounts to about almost US$300 million per year. However, a substantial proportion of thiq flow i reinvested in Mexico. The followine table indicates the likely trends for the future if past behavior on the part of foreign investors con- PRIVATE CAPITAL FLOWS 1/ (round US$ million) 1969 1975 (actual) (projected) Direct foreign invest- men t 560 of which: new investment 125 250 rei.nvestmuent 12 310 -JL Investment income ou-tflow 410 860 of which: reinvestment 125 310 effective outflows 285 550 Net balance of payments effect -160 -300 1/ a St-riticn1 Annpndix table 3.4. Source: Mission estimate based on 1960-1969 trends. - 45 - 99. During the last decade direct investment amounted to US$1,600 million and direct investment income outflows to US$2,500 million. 1/ The mission's projections suggest that during the next decade direct investment may amount to about US$5.5 billion and income outflows to about US$8.6 billion, if past behavior continues. This would obtain only, however, so long as foreign firms continue to reinvest as in the past. However, in the event of a change in attitudes on the part of foreign investors, outflows can be expected to continue at least at their historical rates, while inflows could drop. This would have very serious balance of payments effects. One of the best ways to guard the economy against such an eventuality would consist in carrying out imaginative and vigorous export promotion policies particularly for manufacturing industry. Mexican and foreign industry alike can increase their contribution to foreign exchange earnings considerably and thereby gradually modify the structure of Mexican industry in the direction of a more open economy. 100. Moreover, a sizeable share of Mexico's capital stock is already owned by non-rPRidPntq nartiriTarIv in mnnuifnnturinc inditry. If nast behaviour on the part of foreign private investors continues, the share of fnrtiPon-nwn.-d ranrn1 wnaild riqp firt-hPr in tho fiuriirP rl.pqrlv a limit- to the proportion of industrial capacity owned by non-residents that is arrPntable to the Mpvirnn niit-hnriPi may he ranched eventnlly, thus re- ducing the scope for further expansion in this form of capital inflows, and strengthening the need for other source of fInance. B. Creditworthiness ing has risen substantially during the last decade, as indicated earlier, and in 1 6 i ec hedL an alA Jlime I_ .11 I 4: 4 IC J'arlA. 4..tL T LL '. ) __ '4, - 5 1 '0 4. c. sector borrowing should increase to about US$880 million, and, depending on changes n nva4te short-term cmnital Inflia from aroad the Gnvernment mav have to supplement medium- and long-term borrowing by short-term credits of the ordr of 11(S50 to 100 m4114-n Last year's net external medium- and long-term public borrowing also reached an all-time high of US$372 million. now and 1985. 2/ They would remain fairly constant at about US$350-400 million .4 I 11 a mW U A..LL OU 4HCLLL AL.W C LL1 A.IJUUL 1U L. L~LL.I. C 1075A deaau cline suvsequendly. However, tue roughly cunstaut leycl of net public sector external borrowing during the next five years implies a nCCU AUL LiLl VlUeIsE oI1L1 CALCLgUrs lUL Lowing Which WUULU cUnLiUC unlLl 1/ Investment and income outflow data both include reinvestment by foreign L/ See Statistical Appendix table 3.4. - 46 - about 1980, when gross requirements would level off at about US$1.6 billion ner year. Mexunin rgepivPQ very fow "nff" Ians, mnd the sar of on- e loans (over 15 years) in total borrowing is smaller than in most developing ton-ntrip : t-hp fn11nwinv fnhlp qhowq thnt- lon nuor iS yuer rereeont nly about one-third of the total medium- and long-term public debt outstanding. Th maturIty ctructuro has not improved -- in the cnse o f a--4-shae of longer term debt -- during the past few years. Rather, the maturity structure of new.- debt suget that there has- been a shift, away from long-t rm and in favor of medium-term borrowing, as evidenced by the sharply rising shr fnw et-wth11 ersm-uiie.TJ -ortenL -I*LZ -I' maturities has worsened Mexico's average borrowing terms even further and the years to come. MATURITY STRUCTURE OF PUBLIC EXTERNAL BARer.TFThX _ TAN T 'flUM ThrU'I /TNT.'T VTT T y-nconT\ 11I f,L1LUT1I TnT-i' v v nrw1r. /LTU 11" LT e * 1 .4A 10DUIJL0LU/ if (percent) 1965 1966 1967 1968 1969 A. Debt contracted during: 1 to 5 years 36.8 33.8 40.4 33.0 44.2 over 5 to 10 years 10.9 23.2 26.9 17.6 33.9 over 10 to 15 years 9.0 25.2 20.7 26.4 9.4 over 15 years 42.8 17.2 11.9 22.1 11.3 Unknown 0.9 0.6 0.1 0.9 1.3 Total 100.0 100.0 100.0 100.0 100.0 B. Total outstandini at the end of: 1 to 5 years 20.7 18.0 19.7 18.7 20.9 over 5 to 10 years 15.2 16.1 18.5 16.8 19.0 over 10 tn 19 years 26.7 28.2 27.4 29-4 26-9 over 15 years 35.7 36.2 33.4 34.4 32.6 Unknnon 1.7 1-5 1_0 0.6 0.A Total 100.0 100.00 100.0 100.0 100.0 1/ For the interest rate structure of external borrowing see Statistical Appendix tables-4.5 and 4.6. Dore LDLXV,~ Statistic..al Services DlJviJasi0n. 1ill. A decree hs Ueu ibUU n JUUe IV LU srLIgtU LHe Finance Ministry's control over external public sector borrowing through annual authorizations. It spells out criteria that would guide the rinance Ministry in screening future applications by public sector agencies for external loans. - 47 - 103. One of the most notable features of the decree is an explicit re- cgn -tI-on. of the balance ofpyens ------oso xtra db eriIg Borrowing authorizations would no longer be granted for projects that do not would appear to affect primarily the decentralized public sector agencies recently borrowed funds abroad on very hard terms. However, some change in emphasis i fudera 4u nuvOstmeCAt may alo result LUI LIle LeCW UCLeC L1n favor, for example, of irrigation for export crops, tourist infrastructure, airports allu LLICL CAUL LULC1iLCU 1 UjCcLO. LUil Will UCCLIU UK LUULdpn ULL Lico e intCr pretation that is given to the concept of generating foreign exchange par- power and transport would be evaluated. If a flexible interpretation were aUULCU, Lle UCLeC WUULU LUL CULrC a sililicdail tSLL 1 iCUCLG aHliVCL ment financing, but it might still further increase the weight given to bal- ance ofparnet consICIL CiUCdea ionIs ini federaiL Investrijent decisionls. 14. THe decree further limits authorizaLios tO THE import content U investment projects. This suggests that Mexican authorities wish to alleviate future balance or payments pressure created by the debt service even at tle cost of foregoing some local cost financing during disbursement. 105. The new measure clearly responds to pressure arising out of the recent deterioration in the maturity structure of the external debt. Credits by private foreign financial institutions and suppliers have increased sharply during 1969, largely on account of borrowing by decentralized public sector agencies. The new decree stipulates that external borrowing by national cre- dit institutions may be authorized even though it fails to meet the require- ments outlined above, when new loans contribute to improve the terms structure of Mexico's external debt. 106. Enforcement of the decree may have to be very gradual since Mexico, if it continues to grow rapidly, will require gross public external borrowing of the order of US$1.4 billion per year during the next ten years to finance its current balance of payments deficit. In view of the relative scarcity of projects likely to satisfy the new set of requirements, it is doubttul whether sufficient amounts would qualify under the new decree to finance the current account deficit. 107. Mexico's debt service ratio is already quite high having reached 22.6 percent in 1969. 1/ Projections suggest that the debt service ratio may well, in the absence of remedial action, reach the lower 30 percent range be- tween 1973 and 1980. 2/ These levels are quite high and can only be sustained 1/ As in most larger Latin American countries, the bulk of the debt out- standing is to non-Central Government public sector agencies. 2/ See Statistical Appendix table 3.4. - 48 - if the international financial community continues to have confidence in the Mexican economy. Even if public savings are raised by the amounts described in Chapter II -- i.e. by about 5 percent of current public sector revenues -- the debt service ratio could -ot be prevented from rising, but new borrowing would be sufficiently reduced to permit the debt service ratio to stay well below 30 percent. The convertible status of the 11exican peso ultimately de- pends mostly on the degree of confidence enjoyed by the economy. The aryuIent oftcn set forth in Mexico that a high debt service ratio is not a serious danger signal, because the peso is freely convertible, so long as foreign flows are invested for productive purposes, ignores the balance of payments implications. Thus, even though funds borrowed abroad may be invested in very productive projects, this does not automatically assure availability of the foreign exchange necessary to service the loans. Rapidly rising external indebtedness is not, in itself, a cause for concern among creditors, as long as it is not interpreted as a sign of failure to resolve the country's fund- amental structural economic problems: the sluggish behavior of exorts, the low level of public sector savings, and ultimately, the low productive capa- cTy and nurchasine power of a sizeable part of the nopulation. Conversely demonstrations of a continued awareness of these problems, and of a willing- ness to bring to bear on them the full vicor and ingenuity with which other domestic problems have been resolved in the past, will not only help to reduce the crowth of external indebtedness itself. but also will loom lar2e in the judgements external creditors are likely to make about Mexico's future ability L ocntrc,r nT1,11 Prvic external dhts. The nr;t record in thiq ripnpct. strongly suggests that Mexican society has the required resources of social e1 in ahil -j v and nolitical will to takP Hhp nPeded measures. and thwq to preserve the enviable image of a fully creditworthy borrower. .qTATT.TTr'AT. APPRNTTY T 'Dr)DTrr A rITr))T AUJTi VWMDTf)X?MMJM .L. 0 1J W1 JA J.LLW11 1U1 A.0 J.AI " UX "W LrLLJ11 I 1.1 Population - Vital Statistics, 1960-1980 _L . C L7fu fO~U-La U,.on 01. i1AULLL~pdALJLfJ,'i VV.LWL~4 rIV17" I1 LL ",% V JUV £LLLLa k0aridL t and Intercensal Growth Rates 1L.3 Age SpeucificL ueat R1 Iatesz Age and Sex Distribution of Population, 1950-1980 1.5 Age Specific Fertility Rates and Gross Reproduction Rates 1.6 General Fertility in Mexico, 1930-1970 Births Per nousand Women in Childbearing Age (15-u19) 1.7 Age Specific Fertility Rates and Gross Reproduction Rates i Mexico City, 95-1yor 1.8 Analysis of Completed Fertility in Mexico City, 196L 1.9 Economically Active Population H±. N'ATIONAL ACCOUNTS 2.1 Gross Domestic Product at Market Prices by Type of Economic Activity 2.2 Gross Domestic Product Percentage Change at Market Prices by Type of Economic Activity 2.3 Gross Domestic Product at Market Prices, 1960-1969 .h Value, Volume and Price indices of the Gross Domestic Product at Market Prices, 1960-1969 2.5 GD? Deflator, 1U6o-1970 2.6 Expenditure on Gross National Product at Current Prices, 1960-1970 2.7 Financing of investment, 1960-1970 2.8 National Accounts Projection, 1970-1985 III. BALANCE OF PAYMENTS AND EXTERNAL TRADE 3.1 Balance of Payments, 1960-1970 3.2 Balance of Payments on Current Account, 1950-1970 3.3 Balance of Payments on Capital Account, 1960-1969 3.h Projection of Balance of Payments, 1970-1985 3.5 Commodity Exports, 1959-1969 3.6 Structure of Merchandise Exports, 1960-1969 3.7 Exports - Growth Elements, 1959-1969 3.8 Projection of Major Commodity Exports, 1969-1975 3.9 Commodity Imports, 1960-1969 3.10 Value of imports of Commodities by End-Use, 1959-1969 3.11 Structure of Commodity Imports, 1959-1969 3.12 Structure of imports in Relation to Consumption, GNP and Investment, 1960-1969 3.13 Value of imporLs of Merchandise by Public and Private Sectors, 1957-1969 3.1L Value of Imports to Border Zones and to the Interior, 1960-1969 3.15 Tourism and Border Trade 3.16 Net Factor Income Payments to the Rest of the World -2- Table 3.17 Other Income and Expenditures and Transfers on Current Account 3.18 Major Commodity Exports to L.A.F.T.A. Region, 1966-1969 3.19 Major Commodity Imports from L.A.F.T.A. Region, 1966-1969 3.20 Exports to L.A.F.T.A. Countries 3.21 Imports fran L.A.F.T.A. Countries IV. EXTERNAL DEBT 4.1 External Public Debt Outstanding as of December 31, 1969 h.2 Estimated Future Service Payments on External Public Debt Outstanding Including Undisbursed as of December 31, 1969 h.3 Past Transactions on External Public Debt, 1965-1969 hb Debt Service Ratio, 1960-1970 L.5 Structure of Mexico's External Borrowing h.6 Structure of Mexico's External Public Debt Outstanding V. PUBLIC SECTOR FINANCES 5.1 Public Sector Resources for Investment, 1960-1970 5.2 Public Sector Resources for Investment, 1960-1970 5.3 Federal Government Finances, 1960-1970 5.4 Current Finances of the Federal Government, 1960-1970 5.5 Current Revenues of Federal Government, 196-1970 5.6 Current Account Transfers of the Federal Government, 1960-1969 5.7 Current Account Finances of Selected Decentralized Agencies, 1960-1970 5.8 Current Account Revenues and Expenditures of the Federal District. 1960-1970 5.9 Fixed Investment of Decentralized Agencies and Federal District, 1960-1970 5.10 Analysis of Public Sector Finances. 1960-1970 5.11 Public Investment Program, 1960-1970 5.12 Sectoral Distribution of the Public Investment Program. 1960-1970 5.13 1969 Public Sector Investment 5.1L Planned Public Investment Program for 1970 5.15 Planned Projects in the Federal Government Investment Progra 1969 and 1970 5.16 Public Sector Finances - Projection, 1970-1976 q.17 Sectoral Value-Added. Gross. Indirect and Direct Tax Distribution and Tax Burden, 1966 VI. MONETARY STATISTICS 6.1 Consolidated Summary Accounts of the Banking System A9 Summary Aceoumnt of the Rank nf MAyicn 6.3 Summary Accounts of the Government Banks q1.... S 92mar Aco nts oflthe Dapnsift and Savings Bankst 6.5 Summary Accounts of Private Credit Institutions Other Than Deposit 6.6 Money Supply 6.7 Privna Holdings of Money and Qnas4 Maner in Unin+4orn to Output and Investment A.Q P4-£ . --4--.L~5 --dOPA +I,4 J LS- JdLlJ Qy C.Se - 3 - 6.9 Banking System Financing by Destination 6.10 Banking System Financing by Destination, 1960-1969 6.11 Financing Extended by Banking System 6.12 Financing Extended by Bank of Mexico 6.13 Financine Extended by Deposit and Savings Banks 6.1h Financing Extended by the Private Credit Institutions 6.15 Financing Extended by Other Private Credit Institutions 6.16 Financing Extended by Investment Companies (Financieras) 6.17 Financing Extended by Public Credit Institutions 6.18 Agricultural Sector Value-Added and Banking System Credit 6.19 G-ross Financins Extended by Bank of Mexico to Public Sector 6.20 Banking System Securities Held by the Private Sector 6.21 Holdings of Fixed Tnterest Panr 6.22 Issue of Fixed Interest Rate Paper 6.21 Maximum Authori.ed Annuql Yipld. on SAeafted Bank Liabilities Before and After the June-July 1969 Measures 6.2b Financing Extended by the Bankina Svtem to Arriculture and Livestock 6.25 International Reserves of the Bank of Mexico 6-26 Tnternntinnn1 Raqtrvp.q nf thie Rnk of Marin 6.27 Registered Stock Exchange Transactions, 1960-1969 62R structnre of Reserve Requirements of +hae BankAing Ce+aom VII. AGRICULTURAL STATISTICS 7.1 Agricultural Production, 1960-1969 7-2 iebrie Prodt+Ann h Prininnl Spnazs 1910-196A 7.3 Expenditures of the Federal Goverment in Infrastructure for Avi,nl+n,a 7.4 Areas Benefiting from Federal Goverment Investment in Small and Large Scale irria+inn 7.5 Small Irrigation Wobrks, 1959-1969 7.6 AAicul+nral Su '+ p ort ics 109Ar-0i0 VTT, nT1UPD QV0W)pDZ 8.2 Structure of Industry, 1968 8.3 Minaal Prnduction, ocn1 QAQ 8.h Petroleum Products, 1960-1969 8.5 Baic Petrochemical Production, 109). 1060 8.6 Tourism, 1960-1969 8 7 Primar CVo1 A++-mi+4n nae 106_10A7 ix. PRIC bSet WANd 0.1 P i,a Tvi wvmvc -i Kn-i t 4 4-, 9.2 Estimated Wage Payments by Sector and Wage Share of GNP, 1960-1969  Table 1.1: POPULATION - VITAL STATISTICS, 1960-1980 Infant Rate of Net Population Birth Death Mortality Natural In- Immigration/5 Year ('000)/1 Rate/2 Rate/2 Rate/3 crease (%)/4 ('000) Ioen/A 5 qR9 )J7 1q.9 96.2 9-A9 1951 27,039 43.8 17.0 99.0 2.68 45 19C2 97 AL.A 02. h. 7 89A 282L 1953 28,701 44.0 15.5 95.1 2.85 6 Iot 01)o-1 And 1 LC 1 19 A An .1 1 9C A 1955 30,557 65.1 13.3 83.3 3.18 67 1oiA 1 C7 C 9 11 7 71 r) 1957 32,607 46.5 12.7 80.1 3.28 82 infq SJ 7tA. 1.0 0 1 A A 1 ) AO0 1 7 )u ) ), v Iee Ace VV*A .* / w w 1959 34,851 65.6 11.4 74.4 3.42 80 17uu/u J)Ulu"u L414*7 -LeL r 14* . ) ( 3Iu_ 1961 37,268/7 44.5 10.4 70.2 3.41 104 voc'-: 1o,1. rs , -iu., ur >'u 1963 39,87177 44.5 10.5 68.5 3.4o 183 1 , I.rr' n n1n ,cLI r, n~ rIn' l 1965 42,68977 44.6 9.5 60.7 3.51 235 -100 4 ,4,7 4 au. 4.0 0.f 3.0aY 1967 65,67177 43.6 9.2 63.1 3.h 308 100 .47,2o67 3-.U 1.4 Oe)53 Z 1969 48,93377 n.a. n.a. n.a. n.a. nea. (U7/O U, Lly1/o 14.1/ 0.9/7 - 3..Y/ 19751/7 6o,1402 42.8/7 7.7/7 -3.50/7 1980/7 72,392 42.9/7 7/7 - 3.1/7 1/ Mid-year. 2/ Per 1,000 population, observed 1950-1968, projected 1969-1980. Birth rate since 1960 corrected for consistent under registration. / Per 1,000 live births. Earlier rates (%): 1900 - 0.08, 1910 - 0.13, 1922 - 0.61, 1931 - 1.72, 1940 - 2.11. 5/ Migration figures are unreliable as there is a substantial disagreement between Mexican and U.S.A. data on the extent of migration across the common border. Net effect is assumed to be zero, z.ius rate of natural increase is best available estimate of population growth rate. Census year. Projection. / Preliminary data. .-,urce: Secre.arla.de Comercio e ;ndus,,ria and Bank of Mexico.  Table 1.2: 1970 POPULATION OF MUNICIPALITIES WITH MORE THAN 100,000 TMP-A-R-TTA-NTrS AND T~MA (--P.OTX,M P-Ar.PE- Average kunu..L Total Population Growth Rate at n _rLLt ±;OV CL.L.L(U Aguascalientes - Aguascalientes iSh,c11 22210 3.7 Baja California- Ensenada 84,934 113,320 5.7 Mexicali 28133 390, ' 1.3 Tijuana 165,690 335,125 7.3 Coahuila -Saltillo 127,772 191,879 . Torreon 203,153 257,045 2.4 Chiapas - Tapachula 05,UO6 1U0,404 2.5 CHIhuahua - Chihuahua 186,089 363,850 6.9 Juarez 276,995 436,o54 4.6 Distrito - Distrito Federal/1 4,870,876 7,005,855 3.7 Federal Durango - Durango 142,858 192,914 3.1 Gomez Palacio 103,5h 135,73 2.8 Guanajuato - Celaya 98,548 143,703 3.8 Irapuato 127,174 175,966 3.3 Leon 260,633 453,976 5.7 Salamanca 67,097 103,740 4.5 Guerrero - Acapulco 84,720 23,866 10.7 Jalisco - Guadalajara/2 7hO,39 1,196,218 4.9 T1aquepaque77 56,199 108,119 6.8 Zapopan/2 54,562 182,914 12.8 Mexico - Ecatepec7 40,815 220,918 18.4 Naucalpan7l 85,828 373,605 15.8 Netzahualcoyotl/1 /3 - 571,05 - Tlalnepantla/1 105,447 373,657 13.5 Toluca 156,033 220,195 3.5 Michoacan - Morelia 153,481 209,507 3.2 Uruapan 61,221 10.75 5.5 Morelos - Cuernavaca 85,620 159,909 6.5 Nuevo Leon - Guadalupe/h 38,233 153,454 14.9 Monterrey7 601,085 830,336 3.3 San Nicolas de los Garza/4 41,243 111,502 10.5 Nayarit - Tepic 73,576 111,344 4.2 Oaxaca - Oaxaca de Juarez 78,639 116,826 4.0 Puebla - Puebla 297,257 521,885 5.8 Queretaro - Queretaro 103.907 1L0.379 3.1 San Luis Potosi- San Luis Potosi 193,670 274,320 3.5 Sinaloa - Ahome 89.93 165.612 6.3 Culiacan 208,982 358,812 5.6 Guasave 91.02h Th8.h74 5.0 Mazatlan 112,619 171,835 4.3 Sonora - naime 12h.162 181-972 1.9 Hermosi-lo 118,051 206,663 5.7 T___an - CAntA 101,7QR 1A9-6,78 b4.5 Table 1.2: 1970 POPULATION OF MUNICIPALITIES WITH MORE THAN 100,000 TMUAnTTAMCP A)n TNIMTWP'MAT rII3AWnPJ DAMq Page 2 of 2 Average Annual Total Population Growth Rate ~ - T -n-j" 'I- Q4 n 1cL -2 n '7 Iazmallpas - 14..WJULLUD L1Vu) -UL,UU ( Nuevo Laredo 96,043 150,922 4.6 RIrro sa 1 34,86Q9-U l3 ,i- 7U 0.7 Tampico 124,894 196,147 b.6 Veracruz - Coatzacoalcos 5u,aey IU,8U8 7.2 Jalapa 78,120 127,081 5.0 Poza Rica de Hidalgo 71,770 121,3141 !. Veracruz 153,70 242,151 4.7 Yucatan - Merida 190,62 2 I,o! 2.9 Zacatecas - Fresnillo 82,205 101,i16 2.1 TOTAL 12,11,004 19,469,934 4.8 Percent of Total Mexico Population 34.4 39.3 /1 Part of the Mexico City metropolitan area. /2 Part of the Guadalajara metropolitan area. /3 Municipality created in 1963 from parts of the towns of Texcoco, Chimalhuacan, los Reyes La Paz, Ecatepec and Atenco. /4 Part of the Monterrey metropolitan area. Source: Secretarla de Comercio e Industria; Preliminary.data from 1970 census. Table 1.: Å,E SPECTFTC, DEATT4 RATES (per 1.000) __________19>40 1990 1960 1965 1966 All Ag2. 16.2 i . 9. 9. Under i 20. 138.8), A 1 67. 697 - >8.2 27.8 14.5 9.5 10.0 = o 7. .5 2. A2.1 2 .1 15-19 6.0 3.6 2.2 1.7 1.7 25-29 10.0 6.1 4.2 3.4 3.4 30-36 11.5 7.2 4.9 4.2 4.0 3531. .1 6).3 5.9.9 40- U 15.4 9.9 7.3 6.2 6.3 U0-4 21.6 15.i k1.7 10.6 10.I 55-59 27.1 21.0 17.2 14.5 14.9 60-64 60. 28.9 22.6 23.1 22.5 65-69 54.8 42.8 35.0 32.5 34.4 70-74 84.7 62.9 51.4 45.4 h.8 75-79 108.0 89.1 74.9 67.5 67.9 80-8h 161.1 120.7 102.9 ) ) n~ , - -- - - 194.7 , 196.1 oS and over 295.2 2>4.8 159.9 ) Source: UN Demographic Yearbook. Table 1.h: AGE AND SEX DISTRIBUTION OF POPULATION, 1950-1980 (Thousands of people) M a 1 e F e m a 1 e Age 1950 1960 1970 1980 1950 1960 1970 1980 0- b 2,007 3,h62 4,772 6,938 1,978 3,261 4,568 6,63h 5- 9 1,872 2,721 3,931 5,623 1,816 2,62 3,762 5,68 9-1 1,605 2,203 3,326 h,639 1,516 2,159 3,129 4,4h0 15-19 1,253 1,771 2,670 3,877 1,389 1,780 2,585 2,72 20-2h 1,070 1,482 2,155 3,272 1,237 1,537 2,125 3,097 25-29 985 1,230 1,715 2,606 L,0I2 1,303 1,735 2,5h0 20-3h 702 1,065 l,h21 2,088 736 1,118 1,487 2,075 35-39 751 891 1,169 1,67 801 941 1,254 1,687 40-4 589 719 1,001 1,352 625 776 1,067 1,4'5 45-h9 537- 597 824 1,096 5h1 639 889 1,198 50-54 407 535 651 920 424 535 722 1,005 55-59 263 439 524 735 268 >431 u80 819 60-64 266 319 448 555 290 329 467 6k1 65-69 165 229 3h3 418 170 2>43 352 485 70-7h 114 157 226 326 128 167 2>42 5b4 75-79 63 99 139 215 66 107 152 228 80 and over 73 83 116 171 91 94 123 183 TTAL 12,719 18,002 25,431 36,47B8 13,117 18,044 25,239 35,914 Source: Proyecciones Demogra;ficas de la Repilblica Mexicana, Secretaria de Industria y Comercio, 1966. 1/ Tabh I.: APE SPECIFI FERTT.TTY RATES AND C,ROSS REPRolUTTIN RATES~ A e 1929-11 1918-60 1951-56 1999-61 196h-66 1966-65 20-29 .283)4 .176 .3120 .2998 .3009 .0963 25-29 .2801 .1195 .1135 . 3175 .32)40 .3180 -6.29O .2371 .2586 .2693 .2511 .2)456 -.9 . 7 .6 .n7 0 3.0-7 .i 06 i -.1 3. ý -16 . 3 .9 1/ rer woman in age group. Table 1.6: GENERAL FERTILITY IN MEXICO, 1930-1970 BIRTHS PER THOUSAND WOMEN IN CHILDBEARING AGE (15-49) Female Pop. 15-49 N -, ^o pF Estimated Births PF Year 15-49 N 15-49 1930 4.375.59 867,623 198 19h0 4,970,91 974.511 196 1950 6.370.690 1.225.656 192 1960 8.068,00 1.61h,.929 200 1965 9,h13,000 1.900.6L0 202 1970 11.110.700 2.210.067 199 Source: Din'mic d ln PnhInriAn HP Mipn-. 1 r.nai-n ri M4xico 1970. Table 1.7: AGE SPECIFIC FERTILITY RATES AND GRjS REPRODUCTION RATES IN 0EXICO CITY. 191-1967- Index Basis, 1951 = 100 Ap1951 1959-61 1966-68 1951 1959.61 1966068 15-19 0*0829 0775 o.oh 100 9i 78 2O-2 005n1 n 2641 n08h0 100 in 106 25-29 Mb0 0Mn90n 0o2826 100 111 107 0A 0.193 0.2551 0.2177 100 132 ll 15O9 0100 0. 1709 0. ARR 1Ao 19R 120 Un La Q no An AcO/1R A AAA in AA9 DI 2 2.. 2.74 100 108 104 - C * n4miJLI A T C ahi.4 A MA 4- L'..J"J s MA 4- 1 7 1 Purcer Don a in !a obscp. n de MKico; Ej Colegio d o 1970e 1/ Per woman in age group. Table 1.8: ANALYSIS OF COMPLETED FERTILITY IN MEXICO CITY, 1964 (Rates per 1,000 women in childbearing age) A. Pregnancies and Live Births 1. Pregnancies 3.76 2. Abortions .h a. Provoked .09 b. Spont'neous .35 3. Still Births .06 4. Live Births 3.26 B. Births and Education, By Age Groups No Level of Instruction Age Schooling 1-5 Yrs. 6 Yrs. 7-11 Yrs. 12 or More Total 20-2a 1.63 1.39 1.27 0.62 0.32 1.07 25-29 2.96 3.32 2.88 1.95 1.10 2.68 30-3 ).19 b.6 3.,3 2.57 1.50 (.66 35-39 5.73 5.20 I..b 3.60 3.67 4.71 ),o-),) 7.09 6.35 h.38 3.33 3.00 5.21 45-49 5.90 5.02 4.67 2.85 3.15 4.61 50+ R.86 h.75 2.58 2.75 3.Ao 3.83 C. Births and PlaceP nf Origin Ag Foreg Mexc Cityr 0thepr Urbann -ren Ruiral Totaml 20-2). 1.50 1.00 1.28 1.07 1.08 25-29 2.00 2.56 2.75 2.88 2.69 3-3. 2.75 3.36 3.79 h.17 3.68 35-39 1.25 4.52 h.66 5.32 4.71 I.n- I.). -,). o L. RA I. Rg gi) ~ 9 h5-49 2.67 h.25 h.50 5.14 4.61 n.'~å rýn Lý 4c rc. nn i p- le D 26 d 2.9 . e _i.70 . 27 Source : Dinck-Rica de la Po-blación de Méæxico; El Colegio de 'Mexico 1970. Table 1.9: ECONOMICALLY ACTIVE POPULATION (Thousands of persons) 9 Growth 1960 1969 Per Annum Total Population 36,06 48,933 3.5 Economically Inactive 24,714 33,598 3.5 Economically Active 11,332 15,335 3.5 A riculture 6,1h 7,07 1.5 Mining 142 187 3.1 Manufacturing 1,556 2,595 5.8 Construction 808 762 7.2 Utilities 4- 72 6.5 Commerce 1,075 1,729 5.4 Transport 357 477 3.3 Services and Government 1,609 2,b66 h.9 Source: Mission estimate, based on Bank of Mexico estimates of GDP, grificas de la Repdblica Mexicana" Direccion General de ko+-L;ILi.a 1111 isr ofL Jind~I. Loly U k.hI~~L -L7Ou Est Limate~ does not include employment "insufficiently specified" in the year.  Table 2.1: GRDSS DCMESTIC PRODUCT AT MARKET PRICES BY TYPE OF ECONOMIC ACTIVITY (1960 prices) Type of Activity 1960 1961 1962 1963 1964 1955 1966 1967 1968 1969A- Gross amestic Productb/ 150,L 158,036 165,64 178,536 199,246 212,197 226,626 2141,130- 260,651 279,1h29 Agriculture, livestock, forestry & fishery 23,970 24, h25 25,353 26,671 28,671 30,219 30,733 31,563 32,5h1 32,964 Mining 2,306 2,229 2,427 2.17 2.470 2,418 2,486 2,580 2,637 2,806 Petroleum & petrochemicals 5,128 5,846 6,238 6,749 7,1417 8,010 8,499 9,774 10,800 ]L1,915P Foodstuffs, beverages & tobacco 10,620 13,63h 1L,166 15,186 16,2L9 17,163 18,L03 19,024 20,861 22,196 Textiles, clothing & leather manufactures 5,062 5,118 5,358 5,497 6,695 7,137 7,501 8,341 8,975 9,469 bod products, furniture, paper & printing 3,307 3,380 3,752 4,033 4,977 5,271 5,503 5,728 6,112 6,833 Chemicals, rubber & plastic products 2,657 2,747 3,027 3,193 3,676 4,316 4,868 5,408 6,057 6,86U Non-metallic minerals 1,18:2 1,156 1,309 1,357 1,575 1,728 2,020 2,264 2,551 3,038 Basic metals 1,7&5 1,906 1,959 2,329 2,727 2,968 3,313 3,567 3,952 4,276 Metal production & repair 1,019 1,180 1,171 1,414 1,838 2,1L9 2,476 2,5h3 2,9142 3,086 Construction 9,36.4 9,317 9,923 11,362 13,282 13,083 lh,967 16,913 18,164 19,853 Electricity 1,502 1,609 1,752 2,169 2,527 2,767 3,154 3,529 4,224 4,921 Commerce 46,88o ho9,646 51,334 55,749 63,219 67,328 72,310 76,287 82,771 90,220 Transportation & communications 6,322 6,524 6,82h 7,397 7,937 8,175 8,853 9,287 10,290 11,185 General Services 30,925 32,657 3h,616 36,901 39,705 42,206 44,738 47,512 50,885 .5h,091 Adju,stment for banking - 1,519 - L,5814 - 1,658 - 1,849 - 2,208 - 2,283 - 2,701 - 2,941 - 3,009 - 3,271 a/ Preliminary figures. b/ Figures arrived at by applying yearly growth rates to 1960 data; differs slightly from GDP series in Table 2.3. Source: Bank of Mexico, S.A. Tible 2.2: GROSS DCMES'IC PRODUCT PERCENTAGE CHANG' AT MARKET PRICES BY TYPE OF ECONOMIC ACTIVITY (1960 prices) 1961/ 1962/ 1963/ 19614/ 1965/ 1966/ 1967/ 1968/ 1969/-a Type of Activity 1960 1961 1962 1963 1964 1965 1966 1967 1968 Gross Domestic Product 5.0 14.7 79 11.6 6.5 6.8 6.IL 8.1 7.2 Agriculture, livestock, forestry & fishery 1.9 3.8 5.2 7.5 5.ta 1.7 2.7 3.1 1.3 Mining - 3.3 8.9 - 0.04 2.2 - 2.1 2.8 3.8 2.2 6.4 Petroleum & petrochemicals 114.0 6.7 8.2 9.9 8.0 6.1 15.0 10.5 6.4 Foodstuffs, beverages & tobacco 7.0 3.9 7.2 7.0 5.5 5.6 7.3 7.A 6.4 Textiles, clothing & leather manufactures 1.1 4.7 2.6 21.8 6.6 5.1 11.2 7.6 5.5 Wood products, furniture, paper & printing 2.2 11.0 7.5 23.4 5.9 4.4 4.o 6.8 11.8 Chemicals, rubber & plastic products 3.4 10.2 5.5 15.1 17.4 12.8 11.1 12.0 13.0 Non--metallic minerals - 2.2 13.2 3.7 16.1 9.7 16.9 12.1 12.7 19.1 Basic metals 6.7 :2.8 18.9 17.1 8.1 13.4 6.7 10.8 8.2 Metal production & repair 15.8 - D.8 20.8 30.0 16.9 15.2 2.7 15.7 4.9 Construction - 0.5 6.5 11.5 16.9 - 1.5 11.4 13.0 7.4 9.3 Electricity 7.1 8.9 23.8 16.5 9.5 14.0 11.9 19.7 16.5 Commerce 5.9 3.4 8.6 13.4 6.5 7.4 5.5 8.5 9.0 Transportation & communications 3.2 4.6 8.4 7.1 3.0 8.3 4.9 10.81 8.7 General services 5.6 6.b0 6.6 7.6 6.3 6.0 6.2 7.1 6.3 Adjustment for banking services 4.3 4.7 11.5 19.4 3.4 18.3 8.9 2.3 8.7 a/ Preliminary figures. Source: Bank of Mexico, TAble 2.-! r.:ORSS TDnMESqTi1 P-RODUIT AT MARKRT PRICES. 1960-1969 Year Current prices Defi oAa9 rices 1960 0 511 - iic,5ii i nC e ^&"' rlý ^lin ^-I i n44. n.?^~ ennQ 1. 1 .L7uvJL4J 1JL± ±7UJ 2v;> ,4L4 . ..LL7uvUL 1/ Preliminary figures. Source: Bank of Mexico, S.A. Table 2.4: VALUE, VOLUME AND PRICE INDICES OF THE GROSS DOMESTIC PUUUCT AT MAKET PR 1CS, 1960-1969 (1960 = 100) Value index Volume index Implied price index Year (a) (b) (c=a/b) 1960 100.0 100.0 100.0 1961 108.4 105.0 103.2 1962 116.7 110.0 106.1 1963 129.9 118.7 109.5 1964 153.h 132.4 115.9 1965 167.1 141.0 118.5 1966 185.8 150.7 123.3 1967 202.9 160.3 126.6 1968 224.7 173.3 129.6 1969:L/ 248.7 185.9 133.8 1/ Preliminary estimates. Source: Bank of Mexico, S.A. Table 2.5: GDP DEFLATORI 1960-1970 (1960 = 100) Annual Rate of Year Deflator Charge (%) 1960 1,000 - 1961 1,032 3.2 1962 1,061 2.8 1963 1,095 3.2 1964 1,159 5.8 1965 1,185 2.2 1966 1,233 4.1 1967 1,266 2.7 1968 1,296 2. 1969 1,338 3.2 1970 1,392 4.0 Sore Bankb of' Meio Table 2.6: EXPENDITURE ON GROSS NATIONAL PRODUCT AT CURRENT PRICES, 1960-1970 (Billions of Mexican pesos) Net Factor Gross Exoorts of Imoorts of Incame Fixed Goods and Goods and Year GNP Payments GDP Consumption Inventories Investnent NFS NFS 1960 1h8.5 2.0 150.5 12h.6 4.6 23.2 16.6 18.5 1961 160.9 2.2 163.1 134.8 4.8 24.1 17.8 18.L 1962 173.0 2.6 175.6 l5.2 4.9 2h.8 19.h 18.7 1963 192.6 3.0 195.6 161.6 5.6 28.0 20.9 20.5 196L 227.2 3.7 230.9 188.3 7.3 36.7 22.6 2b.0 1967 298.6 5.8 305.b 247.3 7.1 52.9 26.9 28.8 1968 331.h 6.8 338.2 273.6 6.5 60.5 30.7 33.1 1969 367.1 7.2 374.3 299.9 9.6 66.4 33.9 35.5 1970 hob.5 8.1 612.6 332.5 8.3 7M.3 35.6 38.1 Source: Bank of Mexico, Mission estimates. Estimates based on revised GDP series and existing series for other items. Table 2.7: FINANCING OF INVESTKENT, 1960-1970 (Figures in billions of Mexican pesos) Private Public Private Total Foreign Inventorv Invest- Invest- Invest- Capital Domestic Savings Year Investment ment ment ment Inflowi/ Total Public Private 1960 b.6 8.9 ll.3 27.8 1.9 25.9 7.7 18.2 ]961 h.8 8.9 15.2 28.9 o.6 28.3 7.1 21.2 1962 b.9 10.0 l.8 29.7 -0.7 30.b 7.6 22.8 16. 12.0 06.0 33.6 -O.h 3b.0 8.1 25.9 -iA . '7. 1 . 2 . .1.n I 2.6 9. 33. 1965 .7 13. 25- 57 . 51 -1. 3n. 1966 7.2 1.3 31.3 52.8 -0.2 53.0 10.3 2.7 1967 7.1 16.3 36.6 60.0 1.9 58.1 11.3 >6.8 1968 6.5 19.7 bo.8 67.0 2.L 6L.6 12.1 52.5 1969 9.6 23.5 42.9 76.o 1.6 7k.h 13.6 60.8 1970 8.3 25.2 b9.1 82.6 2.5 80.1 15.0 65.1 .1/ Resource gap. Source: nk ol- Mexico. Table 2.8: NATIONAL AC0)UNTS PROJECTION, 1970-1985 (billions of 1970 Yexican pesos) 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1962 1983 1984 1985 GDP at MarKet !rices 1 h12.6 437.4 1463.6 491.4 520.9 552.2 585.3 620.L 657.6 697.1 738.9 783.2 830.2 880.0 932.8 988.5 Factor Income Payments 8.1 9.4 10.6 11.9 13.4 15.0 16.9 18.9 21.3 23.8 26.7 30.0 33.7 37.9 l2.6 48.0 Gross National Product 04.5 428.0 1453.0 479.5 507.5 537.2 568.4 601.5 636.3 673.3 712.2 753.2 796.5 842.1 890.2 940.8 .onsumption 332.5 351.6 371.8 393.2 415.9 439.9 465.1 091.9 520.2 550.1 581.6 615.o 650.2 687.4 726.7 768.2 National Sav!ngs 72.0 76.4 81.2 86.3 91.6 97.3 103.3 109.6 116.1 123.2 130.6 138.2 114.3 154.7 163.5 172.6 Domestic Savings2/ 80.1 85.8 91.8 98.2 105.0 112.3 120.2 128.5 137.4 1147.0 157.3 168.2 180.0 192.6 206.1 220.6 Gap 2.5 1.7 0.9 0.1 - 0.8 - 1.9 - 3.1 - 1.1 - 5.9 - 7.6 - 9.5 - 11.6 - 16.o - 16.6 - 19.5 - 22.8 Investment 82.6 87.5 92.7 98.3 104.2 110.4 117.1 124.1 131.5 139.4 147.8 156.6 166.0 176.0 186.6 197.8 Domestic Savings Ratio (average) .194 .196 .198 .200 .202 .203 .205 .207 .209 .211 .213 .215 .217 .219 .221 .223 National Savings Ratio (average) .178 .179 .179 .180 .180 .181 .182 .182 .182 .183 .183 .183 .184 .184 .184 .183 Domestic Savings Ratio (marginal) .210 .230 .229 .230 .231 .233 .239 .236 .239 .263 .246 .246 .251 .253 .256 .259 National SavIngs Ratio (marginal) .189 .187 .192 .192 .189 .192 .192 .190 .187 .192 .190 .185 .187 .184 .183 .180 Average konsumptian Rate .822 .821 .821 .820 .820 .619 .818 .618 .818 .817 .817 .817 .816 .816 . 816 .817 Marginal Consinption Rate .811 .813 .808 .808 .811 .808 .808 .810 .813 .808 .810 .815 .813 .816 .817 .820 Marginal Import Rate .112 .081 .080 .083 .081 .083 .082 .083 .086 .084 .086 .086 .087 .088 .089 .091 1/ Assuming a 6 oercent annual growth rate. 2/ Including savings to finance inventories. 3/ Including inventories. Source: Missl,n es:imates. Table 3.1: BALANCE OF ?AYMENTS, 1960-1970 ($ million) 1960-1961 192 1963 196 -196 --1966167 W196 196 1970 I. Exports 1,330 1,h24 1,552 1,675 1,808 1,972 2,143 2,152 2,453 2,71.4 2,846 1. Merchandise/i 786 8h 944 987 1,074 1,158 1,237 1,147 1,253 1, U9 1,451 2. Tourism 155 164 179 211 2U1 275 328 363 432 465 514 3. Frontier Transactions 366 393 407 446 463 500 547 600 714 744 819 4. Other (non-factor) 23 23 22 31 30 39 31 42 54 56 62 II. Imports 1,481 1,469 1,h99 1,641 1,916 2,021 2,129 2,30h 2,648 2,839 3,Ah8 1. Merchandise 1,186 1,139 1,143 1,2!0 1,493 1,560 1,605 1,7 8 1,960 2,078 2,179 2. Tourism 40 46 66 84 1(X) 119 136 163 193 234 277 3. Frontier Transactions 221 242 245 265 277 295 343 359 450 480 542 4. Other (non-factor) 34 42 45 52 46 47 45 34 45 h7 50 Balance of Goods and Non-Factor Services -151 -LL5 53 34 -108 -49 1 -152 -195 -125 -202 III. Factor Income. Payments (Net) -160 -175 -209 -240 -294 -327 -384 -460 -545 -576 -645 1. Exports 4l 39 36 35 34 17 36 43 57 71 77 a. Braceros 36 34 32 31 29 12 11 13 15 19 19 b. Other 5 5 b 4 5 5 25 30 42 52 SB 2. Imports -200 -214 -245 -275 -329 -3h4 -420 -503 -602 -647 -738 a. Direct Investment Net of Reinvestment 131 124 123 :150 186 175 203 216 266 276 294 b. Reinvestment 11 25 36 36 50 61 74 105 110 135 150 c. Public Sector Interest/2 ) (Medium-and Long-Ter;-Debt) ) 58 65 86 89 72 88 91 113 14 151 185 d. Other/3 ) 21 20 52 69 82 92 75 Balance of Payments Net of Reinvestment -300 -195 -120 -170 -352 --314 -296 -506 -630 -566 -697 IV. Balance of Payments on Current Account -311 -220 -156 -206 -402 -376 -370 -612 -740 -701 -867 v. Direct Investment -38 119 126 117 162 214 183 130 227 249 295 1. New Investment 62 82 75 77 95 120 111 105 111 124 15 2. Reinvestment 11 25 36 36 50 61 74 105 110 135 150 3. Other -111 .12 15 b 17 32 -2 -81 6 -10 - VI. Public Debt 164 174 115 172 303 -89 36 318 222 333 320 1. Gross Borrowing/h 317 322 361 382 626 341 529 711 751 860 900 2. Amortization/ ~ 172 166 243 208 304 378 124 421 515 488 580 3. Net (145) (156) (118) (174) (322) (-37) (105) (290) (236) (372) (320) 4. Other (Net) +19 +18 -3 -2 -19 -52 -69 +28 -14 -39 - Cont. on next page. -2- Mexico: BALANCE OF PAYENTS, 1960-1970 (Cont.) 196 961 1962 1963 1 -6 1-19 9-- 1970F VII. Other Capital Account 68 -6 -77 -65 110 17 219 30 -238 231 232/5 VIII. Errors and Omissions 108 -89 9 72 -11 213 -62 174 578 -6k - IX. Charge in Reserves/6 -9 -22 17 110 32 -21 6 0 49 48 - Net Figure of V.3, VI.., VII, VIII, IX 74 -43 -.73 -81 -65 231 80 111 283 70 (232) /1 Includes gold and silver (net). /2 Source: 60-63Bank of Mexico, 1964-70 IBRD Statistical Services, Debt Section. Includes only debts whose terms are available. /3 Including interest on external short-term public sector debt, and debts whose terms are not available. / Adjusted to agree with Public Sector Accounts, therefore includes amortization on debts whose interest is not included in 7 III.2.c above. / 1970 Financing Gap /6 - a decrease. Table .3.2: 3ALAýNCE OF PAYMIENTS ON CURRENT ACCOUNT, l150-1970 (In milions of US dolllars) Net Factor Gold Incone Payments Deficit Exports Imports Trade Tourism Border Trade and to the Rest Cthen-å on Curreyt Year FOB CIF Balance CrCts Debits Net Credits Debits Net Silver of the Worldc1 Net Account2. 1950 L93.4 596.7 -103.3 110.9 9.3 101.6 121.9 76.5 h5.4 50.6 -65.5 +11.h 40.2 1951 591.5 888.7 -297.2 110.9 12.5 98.4 148.3 88.. 59.9 14.4 -91.8 + 0.9 -215.4 1952 625.3 828.8 -203.5 114.9 14.2 100.7 163.0 101.6 61.4 29.5 -95.5 + 0.7 -106.7 1953 559.1 807.5 -248.4 108.8 16.7 92.1 201.8 128.2 73.6 37.8 -70.7 - 2.7 -118.3 1954 615.8 788.7 -172.9 85.7 15.4 70.3 246.7 -162.2 84.5 48.3 -68.0 - 7.6 - h5.h 1955 738.6 883.7 -165.1 118.1 16.7 loi.4 261.7 151.2 110.5 h.o -82.h - 3.0 22.4 1956 807.2 1,071.6 -264.4 133.6 21.8 111.8 277.9 171.8 106.1 42.7 -116.2 - 3.0 -123.0 L957 706.1 1,155.2 -49.1 128.8 22.9 105.9 313.3 192.6 120.7 52.0 -122.1 - 0.1 -292.7 1958 709.1 1,128.6 -419.5 134.2 24.7 109.5 315.5 188.8 126.7 49.1 -132.1 - 1.7 -268.0 1959 723.0 1,006.6 -283.6 1h5.1 30.5 114.6 354.0 220.5 133.5 29.9 -135.4 - 5.6 -1h6.6 1960 738.7 1,186.4 -447.7 155.3 10.5 11.8 366.0 221.0 165.0 7.7 -159.5 -11.4 -311.1 1961 ß03.5 1,138.6 -335.1 164.o 65.5 118.5 .392.7 242.C0 150.7 ho.8 -175,.0 -20.4 -220.5 1962 899.5 1,1h3.0 -243.5 178.6 65.5 113.1 1o6.7 244.6 162.1 )t4.5 -209.,3 -23.3 -156.4 L963 935.9 1,239.7 -303.8 210.6 84.3 126.3 145.9 265.2 180.7 51.3 -239.9 -20.6 -206.0 1964 1,022.4 1,493.0 -470.6 240.6 100.2 1ho.h h63.3 276.6 186.7 45.5 -299,h -10.4 -407.8 1965 1,113.9 1,559.6 -45.7 274.8 119.1 155.7 499.5 295.2 204.3 44.3 -327.,3 - 7.1 -375.8 1966 1,192.b 1,6o5.2 -412.8 328.4 136.0 192.4 546.7 342.8 203.9 44.6 -383.8 +15.6 -310.1 1967 1,103.8 1,748.3 -6hh.5 363.1 162.6 200.5 599.5 359.1 2,0.h h3.3 -+59.3 • 8.2 -611. 4 1968 1,180.7 1,960.1 -779.4 431.9 193.4 238.5 713.5 i50.b 263.1 71.9 -545.2 +11., -739.7 :1969 1,385.6 2,078.0 -692.4 465.2 234.1 231.1 74.3 1480.1 264.2 63.6 -576.4 +13.8 -696.1 1970,3 1,1386.0 2,179. -793.4 514.0 277.6 236.6 818.7 542.0 276.7 65.0 -6>5.0 +13.1 -847.0 /1 Gross of reinvestment. 72 Includes invisibles n.e.c. and transfers. 73- Estimated. Source: ihnk of Mexico and Mission estilatcs.  Table 3.3: BALANCE OF PAYMENTS ON CAPITAL ACCOUNT, 1960-1969 (Figures in U.S. $ millions) 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969L BaLance on Current Account (New) -300.5 -195.3 -120.2 -170.0 -351.9 -31.4.4 -296.1 -506.3 -629.5 -566.5 Reinve stment -10.6 -25.? -36.2 -.36.0 -50.2 -61.3 -73.7 -105.3 -110.2 -134.7 Balance on Current Account (Standard) -311.1 -220.5 -166.lt -206.0 -402.1 -376.7 -369.8 -611.6 -739.7 -701.2 I. Public Medium- and Long-Term/2 163.5 173.6 15.2 172.4 302.9 -88.6 36.5 318.0 2221.5 333.4 (a) Loans and Suopliers Credits _1779 185.3 129.7 137.1 3 -,. 23.5 215. 102.0 303.8 1. Inflow 352.1 357.3 383.1 367.7 639.1 309.1 473.6 648.8 636.0 787.3 2. Outflow 163.2 172.0 253.4 230.6 297.9 365.7 450.1 433.3 534.0 483.5 (b) Bonds and Government Debt -25.4 -11.7 -114.5 35.3 -24.0 22.3 25.6 71.8 109.3 48.3 1. Inflow -- -- -- 38.6 56.8 26.4 45.1 93.1 131.5 73.8 2. Outflow 25.4 11.7 14.5 3.1 80.8 4.1 19.5 21.3 22.2 25.5 (c) Export Promotion Credits -- -- -- -- -14.3 -54.3 -12.6 30.7 11.2 -18.7 1. Inflow -- -- -- -- -- -- 56.8 714 64.1 75.7 2. Outflow -- -- -- -- 14.3 514.3 69.4 40.7 52.9 94.4 II. Other (Net) - Siecial Transactions -- -- -- -- -- -- -- -92.0 -71.0 71.0 III. Public Short-Term (Net) 120.2 30.2 -70.3 -23.4 117.4 -15.7 1714.5 32.3 -199.7 26.5 IV. Private Capital -89.3 84.1 119.4 94.7 154.7 245.9 226.6 219.6 258.9 381.8 (a) Direct Investment - .C 119.3 126. 1.17. ll 213.9 17.3 1797 227.0 29.0 1. New Investment 62.5 81.8 74.9 76.9 95.1 120.1 111.1 105.4 111.1 124.3 2. Reinvestment 10.6 25.2 36.2 36.0 50.2 61.3 73.7 105.3 110.2 134.7 3. Other -.111.1 12.3 15.4 4.5 16.6 32.5 -2.0 -81.2 5.7 -10.0 (b) Medium- and Long-Term (Net) ... ... ... ... ... ... 0.2 14.2 6.2 2.3 (c) Securities (Net) -5.14 -7.14 1.14 -6.3 -8.5 L1.9 -10.1 -4.4 5.1 17.3 (d) Current Imports ... ... 17.13 17.9 56.2 35.1 77.8 86.2 99.4 102.8 (e) Short-Term (Net) -45.9 -27.8 -26.3 -314.3 -54.9 -15.0 -23.8 -5.9 -78.8 10.1 V. Errors and Omissions 108.1 -88.9 9.0 72.0 -141.3 213.2 -61.7 173.5 578.0 -63.5 IV. Change in Reserves -8.6 -21.5 16.9 109.7 31.6 -20.9 6.1 39.8 49.0 48.0 1 Preliminary. /2 Sub-classification differs from that of item VI on Table 3.1, but net flow is the same. Source: Bank of Mexico Table 3.4: IEXICO - BALANCE OF PAYMENTS, 1970-195 (In USC mIllion) 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1981 1985 Exports 2,846 3,075 3,30 3,551 3,819 4,109 4,423 4,761 5,134 5,536 5,973 6, 448 6,965 7,527 8,140 8,808 Merchandje. 1,L51 1,531 1,617 1,707 1,802 1,903 2,010 2,122 2,241 2,366 2,498 2,638 2,785 2,941 3,105 3,279 To-~.n 5M, 576 64,5 722 8n9 9as i o 015 aS13 oal7 1i42 cod9 478 2900 2aa,,3 2a,, 2.j3 Frontier transaction. 819 883 952 1,026 1,106 1,192 1.285 1,386 1,39 1,610 1,736 1,871 2,017 2.174 2,344 2,527 Other 62 66 70 71 78 83 87 93 98 104 110 116 123 131 138 146 Import6 3,048 3,208 3,378 3,560 3,752 3,958 4,176 4,410 1,660 4,927 5,212 5,518 5,817 6,199 6,578 6,986 Kerchandise 2,179 2,269 2,363 2,460 2,561 2,667 2,777 2,892 3,011 3,135 3,265 3,399 3,540 3,686 3,838 3,996 Tourie 277 310 347 389 136 488 547 612 686 768 860 964 1,079 1,209 1,354 1,516 rontier tren.ution 542 576 612 651 692 736 782 831 884 939 998 1,061 1,128 1,199 1,275 1,355 Other 50 53 56 59 63 67 71 75 79 81 89 91 99 105 112 118 Rancurce Gap 202 133 75 8 -67 -151 -247 -354 -475 -6w0 -761 -930 -1,118 -1,328 -1,562 -1,823 Factor Income Paymentsl/ 615 754 846 952 1,068 1,201 1,350 1,515 1,700 1,906 2,138 2,401 2,696 3,032 3,411 3,842 of which: Braceros 19 20 21 22 24 25 26 28 29 31 33 35 37 39 1 43 Direct investment noe 4U1 521 589 667 756 858 976 1,110 1,263 1,39 1,640 1,870 2,134 2,436 2,781 3,176 bohlaor tret. ino 90v 9, 0 99R 900 19 R 101 1,4 .IR I.L.0 KK 1.70 I.o ..0 S. Other (net) r/ 35 38 30 30 60 70 83 100 120 16 176 216 Balance on Current Account 8L7 887 921 960 1.001 1.050 1.103 1.161 1,229 1.296 1.377 1,71 1.678 1.70L 1,819 2.019 Direct Investment 295 336 382 434 494 562 639 727 827 941 1,070 1,217 1,384 2,575 1,791 2,037 of hicb: New investment 115 162 180 200 222 217 275 305 339 377 417 462 512 567 627 692 ReInrestnent LL 150 174 202 231 272 315 364 422 488 56, 653 755 872 1,008 1,164 1,345 Other Capital Account Flows 2 232 180 150 120 95 70 70 70 70 70 70 70 70 72 70 70 Gao to b Financed by Pbic B-orrowinjg 20 371 389 06 412 418 394 36. 38 26 237 184 124 59 -12 - Groes public bo w~ing 880 885 1,024 1,230 1,358 1,503 1,484 1,523 1,591 1,616 1,631 1,6o5 1,613 1,61 1,509 1,367 Amortizatioo n/ 560 514 635 824 916 1,085 1,090 1,159 1,263 1,330 1,394 1,421 1,489 1,542 1,522 1,455 Net Public Resource Transfer 6/ 135 156 111 129 114 93 39 -17 -77 -142 -212 -282 -355 -430 -507 -575 Dbt Ot.tading 7/ 3,831 1,202 4,591 4,997 5,409 5,827 6,221 6,585 6,913 7,199 7,436 7,620 7,744 7,803 7,791 7,703 Debt 3ervioc 670 729 883 1,101 1,244 1,410 1,445 1,540 1,668 1,758 1,843 1,887 1,968 2.031 2.o16 1,942 ýDt servce Katio l .235 .237. .267 .310 -326 -343 .327 .323 .325 -318 .309 .293 .283 .270 .248 .220 Foreign Capital Stock Mn.l 2,900 3,236 3,618 4,052 4,546 5,1o8 5,717 6,471 7,301 8,242 9,312 10,529 11,913 13,488 15,279 17,316 Total Capita! Stock $Yln. 87,921 93,637 99,723 106,205 113,109 120,461 128,291 36,629 145,510 151,969 165,041 175,769 187,191 199,362 212,320 226,121 , foreign 3.3 3-4 3.6 3.8 4.0 4.2 4.5 1.7 5.0 5.3 5.6 6.o 6.4 6.8 7.2 7.7 1/ Initial groe0 estimaten. 2/ AdJueted to agree with table 4.4, thus only Includes borrowing officially revorted a mediuo- and long-term, rx1ept fo, 1970 3/ Corresponds to line III-2d minus line III-lb on Table 3.1. / 0 - 0.51(DFI) + .01(t-1970)(DFI), where DPI is direct foreign invetment. 5/ To reach historical average by 1975. 6/ Gro.s inflow le.s dbt service. [/ End of period. 8/ End of the yar. 2/ Crowth rate of 6.5 percent per annum. Soue: IUion estimates. PROJET10ON MOD L ASSUMPtIONS A. Gro-th Rats B_ other Relationships 1. Exports Investment Rate 20% Rerchandi.e 5.595 Based on individual projection. Toi 12 - Banto de Mexico/IBRD Direct Investment Income 12% on the nmgin of Direct Investment - Frontier Trons. 7.8<2 - Historical Historical Other 5.9 % - Historical Re.nestment k% of direct investment where k - 51 + t - 1970 2. Imports iierchandise 4.1 5 - Banco de Mexico Other capital account flows - asoumed to fall from 232 In 1970 to Touris- 12 - Historical long-tem (Historial) average of 70 by 1975. Frontier Trano. 6.3 2 - Historical Other 5.9 5 - Historical 3. Factor Incon Braceros 5.6 % - Historical (sine 1965) .-Diret nestment 13.75% - Historical 5. CDP 6 5 - Target Table 3.5 Mexico: CoMPODI'Y EX?2RTS. 199-1969 A culture ____1959 1960 19 96 193 96 1965 196619 198 _ Cotton Volum"e (tons) 605,268 316,306 305,173 125,173 370,08h 319,998 bh09,022 1429, 462 270,530 315,880 370,221 Value (UE$ mn.) 198.9 157.9 159.9 218.3 195.6 170.1 212.1 221.9 1143.6 170.3 203.2 Price (cents/lb.) 22 22 23 23 2LL 2b 23 23 24 24 25 Corn Volime (tons) 3 457,293 49 6 13 282,437 1,11,6,789 851,809 1,253,809 896,056 788,419 Value (Ts$ mn.) 22.0 0.002 2.0006 0.o0001 15.9 77.2 16.7 72.6 46.5 43.6 Price (pesos/ton) -- 601.4 387.8 833.3 384.6 704.2 84:1.6 685.8 723.9 648.8 691.6 Wheat Volume (tons) 17 1 2 1,502 72,331 575,905 684,5314 46,848 212,373 89 24-7,313 Value (US$ mn.) 0.001 0.0002 0.0004 2.14 5.0 35.8 I.6 3.9 12.6 0.02 11.8 Price (pesos/ton) 647 3,000 3,000 3,129.2 8:57.2 776.2 759.8 1,033.0 741.1 2,247.2 598.1 Coffee (Green) Volume (tons) 74,423 83,030 89,221 91,299 66,600 100,875 78,875 92,283 7h,714 95,361 93,923 Value (US$ nn.) 62.7 71.7 71.8 70.1 49.1 95.2 73.0 83.5 60.2 77.4 78.9 Price (cents/lb.) 38 39 36 3,4 33 42 l 14o 36 36 38 Sugar Volume (tcns) 1k8,751 451,509 566,257 356,790 394,357 524,092 527,175 474,909 550,256 641,158 603,871 Value (US$ rnn.) 14.8 52.9 68.7 43.4 .59.6 76.8 58.9 57.1 67.2 85.4 91.4 Price (cents/1b.) 1.h 5.2 5.1 5.4 6.7 6.5 5.0 5.4 5.5 5.9 6.8 Volilne (tcn5) 29,730 32,179 26,455 34,665 34,640 32,097 27,049 29,939 32,196 25,441 22,963 Value (Us$ mn.) 38.9 34.1 43.7 45.0 51.7 53.5 42.7 53.5 61.5 49.6 45.3 Price (W/Ib. ) 0.58 0.47 0.74 0.59 o.67 0.714 0.70 .80 0.85 0.87 0.88 Toma toes Voiim (tons) 151,694 158,199 95,714 136,264 ,1 3143 152,877 161,488 217,4119 212,844 239,760 276,917 Value (US$ nn.) 23.8 25.5 14.1 20.2 24.5 33.9 35.1 62.9 49.6 57.6 83.9 Price (cents3/1b.) 7 7 7 7 8 10 10 13 10 11 14 Cattle Volune (heads) 373,726 395,653 549,662 766,197 553,B96 357,905 557,439 589,485 524,253 711,880 840,357 value (US$ mn.) 38.0 33.2 42.1 53.2 36.8 22.8 38.1 42.3 38.0 56.7 65.9 Price ($/head) 101.8 83.9 76,.6 69.4 66.3 63.8 63.3 71.8 72.5 79.7 64.3 Meat Vollnne (tons) 21,529 18,792 26,059 27,986 33,678 23,48 22,076 27,710 21,409 32,633 39,397 Value (US$ mn.) 9.8 9.6 15,8 21.2 26.7 18.IL 17.2 26.1 20.4 33.5 39.0 Price (cents/lb.) 20 23 27 34 35 35 35 42 43 46 44 Cantaloupe and Watermelon vohe(tons) 56,294 80,153 68,140 69,311 79,552 83,833 96,892 91,822 89,935 72,692 98,055 ValUe (US$ ian.) 6.o 7.9 9.6 9.9 10.7 11.8 114.4 13.7 12.6 9.1 12.7 Price (cents/lb.) 5 4 6 6 6 6 7 7 6 6 6 Resin Value (US$ in.) 1.6 4.6 6.4 6.3 7.2 5.7 3.6 3.5 3.9 3.7 6.0 Honey value (US$ in.) 2.2 2.3 2.8 3.7 3.6 5.3 14.6 5.2 4.8 5.8 5. 4 Chicle - Value (US$ mn.) 3.4 2.6 3.7 3.2 2.9 1.5 2.6 2.0 2.1 2.1 3.8 Frsh Seafood - " n 2.1 2.2 2.4 2.3 1.8 1.9 1.9 2.1 1.4 1.8 2.9 Vegetal Wax - " n 2.7 2.5 1.9 L 7 1.6 2.0 1.6 1.9 1.4 1.4 1.7 Forage - " 11.6 4.6 5.-4 6.0 5.1 6.7 5.7 4.3 4.2 1.7 1.2 Strawr - " " -- - -- -. - -- 1.0 1.5 3.9 4.3 7.2 Roota - -- -- -- -- -- -- 2.1 2.B 4.7 5.4 5.4 Beans - " -- -- -- --- -- -- 2.7 15.6 10.0 11.4 5.0 Cocoa Beans - "-- -- -- -- -- -- 3.3 3.9 3.0 3.1 1.2 uc umbers - " -- -- -- -- -- - 1.3 1.6 1.9 1.9 3.5 Vegetables,Presh- "-- -- -- --- -- 0.6 0.8 1.0 1.9 2.7 Chilte - " -- -- -- -- -- -- 0.2 0.3 0.3 1.1 1.9 Chili - 1 -- -- -- .1 1.2 1.2 1.3 l. 8 =re - "1 -- -- -- -- -- -- 1.9 1.9 1.9 1.7 1.E Onion - "-- -- -- - -- -- 2.5 2.4 1.4 2.3 1.7 Mandarin -- - -- -- -- 0.9 0.5 1.1 1.7 1.6 Seeds - 3 -- -- -- -- -- -- 0.05 6.6 7.4 0.8 1.3 Others 28.3 29.5 30.5 3j.14 32.8 37.9 11.2 12.6 8.6 8.7 10.2 TOTAL UIL. 8 463.1 478.8 510.3 511.7 595.2 659.2 682.3 602.5 648.5 75.0 Table 3.5 - Cont. Mexico: COMMDITY EXPORTS, 1959-1969 B. gi tural Products __19 9 960 - T 69 96 Pr-ui ts atnd Ve etables 75 9,781496139876 volume (tonsT - 26,199 37,135 U6,396 48,1426 48,537 59,108 68,375 93,773 81,569 78,173 98,706 Value (US$ rm.) 6.5 9.9 12.4 12.6 13.6 21.6 20.0 30.3 25.0 24.6 30.14 Price (cents/lb.) 11 12 12 12 13 16 13 114 1 14 114 Molasses Volume (tons) 331,361 438,059 316, 84h 253,021 463,305 511,843 556,050 499,462 782,389 558,501 650,718 Value (US$ an.) 4.1 5.1 3.8 3.1 9.3 12.9 14.2 9.2 14.6 10.5 12.4 Price (cents/lb.) 0.5 0.9 0.5 0.9 1 1 1 1 1 1 1 Honeque Volume (tons) 79,939 69,559 75,538 78,125 77,661 62,306 53,693 53,353 90,631 38,270 44,299 Value (US$ mn.) 19.6 17.8 19.7 21.2 29.0 24.0 16.9 1-4.2 12.6 8.8 10.2 Price (cents/lb.) 11 11 12 12 14 17 14 12 11 10 10 Ixtle - Value (Us$ mn.) 6.8 8.2 10.7 7.4 6.4 3.8 4.5 5.4 5.0 4.2 6.5 Seafood, Canned & Prepared - " 1.9 2.3 2.5 2.6 3.8 3.3 2.9 2.3 2.2 3.6 3.5 Henequei Fibre - " 7.4 3.9 4.7 6.2 5.4 4.1 4.1 3.4 3.9 3.8 2.7 Other Fssential Oils- " 0.3 0.6 0.9 2.3 2.8 1.2 4.0 4.0 6.1 9.8 2.4 oo@y F Lbre - t " -- -- -- -- -- -- 2.7 4.1 3.2 3.5 4.0 Tobacco and Liquor - -- -- -- -- -- -- 1.8 2.0 2.7 3.5 3.8 Wine and Liquor Extract - " -- -- -- -- -- -- 0.5 0.5 0.4 1.0 3.3 Cocoa Butter - " " -- -- -- -- -- -- -- 0.2 1.0 1.9 3.2 Cocoa Paste - " -- -- -- -- -- -- - -- -- 1.1 1.9 Leather Wptiles) - " -- -- -- -- -- -- 0.4 0.7 1.1 1.2 2.0 Leather (Livestock) - -- -- -- -- -- -- 1.0 1.7 1.4 1.2 2.0 OMhers 6.5 6.7 7.6 7.8 9.2 9.9 ---- TOTAL 53.1 54.5 62.3 63.2 75.5 8C.8 73.0 78.0 79.2 714.5 88.3 Table 3.5 - Cont. Mexico: COMODITY EXPORTS, 1959-1969 - -_____ l95 - -1-9-60 1961- -.962 l91-9-33--I9M SVolue (tons) 1,081,867 1,253,h88 1,15h,689 1,330,996 1,506,781 1,8L0,727 1,539,833 1,504,118 1,637,254 1,416,452 1,165,935 Value (US$ mn.) 23.9 28.2 29.1 30.3 3L.3 37.6 33.6 35.4 48.0 56.7 h2.0 Price (cents/lb.) 0.9 1.0 1.1 1.0 1.0 0.9 0.9 1.0 1.3 1.7 1.6 Zinc Volume (tons) 350,639 378,698 hol,49 349,123 356,238 317,977 308,107 303,420 277,52h 292,166 310,221 Value (US$ mn.) 16.5 22.0 20.8 22.1 23.8 35.1 37.5 36.7 35.7 37.1 40.0 Price (cents/lb.) 2.1 2.5 2.3 2.8 2.9 h.9 5.L 5.3 5.7 5.6 5.7 Flourite volume (tons) 309,519 369,973 41,h48 468,303 510,269 628,690 681,138 743,194 756,279 932,760 975,365 Value (Us$ mn.) 7.5 9.4 11.7 13.0 13.8 16.8 17.5 19.1 16.7 22.0 25.6 Price (cents/lb. ) 1.0 1.1 1.2 1.2 1.2 1.1 1.1 1.1 0.9 1.0 1.1 Lead (Bars) Volum7tons) 169,982 116,023 169,799 134,124 136,713 10,946 107,167 113,920 95,960 95,176 84,093 Value (US$ mn.) 33.9 33.6 37.1 26.0 27.4 23.0 27.7 27.6 214.0 22.4 22.4 Price (cents/lb. ) 10 10 10 9 9 10 12 11 11 11 12 Volume (tons) 720 781 66L 717 650 462 666 676 438 466 1,108 Value (US$ mn.) 3.9 3.8 3.1 3.1 2.4 2.7 8.9 6.5 1.7 5.6 12.8 Price ($/lb.) 2.42 2.17 2.08 1.93 1.65 2.61 5.97 h.31 1.79 5.16 5.16 Cope Bars) Volume ktons) h2,132 34,857 24,461 29,14U 25,194 16,568 8,784 7,527 6,372 6,528 7,311 Value (US$ an.) 28.9 24.9 19.0 24.4 22.5 13.7 7.5 7.6 6.5 7.3 9.2 Price (cents/lb.) 31 32 35 37 4o 37 38 46 16 50 56 Zinc Bars - Value (US$ mn.) 8.4 7.5 6.4 6.0 6.0 7.5 5.2 8.2 8.5 10.1 9.8 Natural Gas - ' " 7.4 6.7 8.1 6.7 6.6 8.2 8.8 8.L 8.9 8.1 8.0 Bismuth - 5 " -- -- -- -- -- -- 2.6 3. 4 3.7 3.6 5.1 Cadmium - " " -- -- -- -- -- -- 0.1 0.3 0.9 0.9 1.4 Tungsten - " -- -- -- -- -- 1.5 1.3 0.9 0.7 1.0 Others 12.1 12.7 12.6 12.2 12.7 13.4 11.6 11.5 10.7 8.7 9.1 TOTAL 162.5 168.8 147.9 163.8 188.9 158.0 162.7 166.3 169.8 184.1 187.5 Table 3.5 - Cont. Mexico: COMbIODITY EXPORTS, 1959-1969 D. PetrochemicRls 1959 1960 1961 19 1 196h 1 1 1 9 Oil olune ('000 m3) 2,090 1,341 2,297 2,981 2,906 2,786 2,8,0 2,842 2,806 2,25L 2,960 Value (US$ mn.) 21.3 13.1 25.3 31.6 30.3 29.9 310.8 30.1 29.7 25.6 31.7 Price ($/barrel) 1.62 1.55 1.75 1.69 1.66 1.71 1.72 1.68 1.63 1.81 1.70 Cherdcal Products - Value (US$ mn. ) 0.5 0.5 0.5 1.5 3.8 2.8 h.8 6.8 8.4 8.6 12.7 Lead Oxide - 2.7 3.2 3.6 L.2 5.8 7.6 9.2 8.3 8.2 8.6 12.5 Chemical Fertilizer - -- -- -- -- -- -- 0.h 1.0 1.0 1.8 4.9 Benzol -- -- -- - -- -- -- 2.5 2.7 Toluene & ylene - -- -- -- -- -- -- -- -- -- 2.9 2.7 Zinc Oxde - " -- -- -- -- -- 1.3 1.5 1.5 1.3 1.0 ntiers 2.6 1.8 3.2 .0 4.3 4.4 0.3 0.4 0.4 0.4 C.8 TOTILL 27.1 18.6 32.6 1.3 Ud.2 h.7 L6.8 48.1 49.1 51.7 69.0 Table 3.5 - Cont. Mexico: C09DITY EXPTS, 1959-1969 E. Manufacturing and Others 9 1 1961 19b2 93 1961t 1965 196 1967 19 Z1969 !ron & Steel Products Volume (tons) 20,383 17,525 7,208 24,462 117,162 76,934 93,307 81,372 68,232 111,968 136,154 Value (US$ min.) 3.7 3.0 1.3 3.7 IL.9 10.5 13.3 11.9 9.8 16.7 20.8 Price ($/ton) 181.5 171.2 180.L 151.3 127.2 136.5 12.5 146.2 1143.6 1149.1 152.77 Hormones (Natural & Synthetic) olum tns 87 12G 161 159 1h5 142 156 179 186 199 247 Value (Us$ mn.) 7.1 8.1 12.7 l.9 14.9 11.1 13.13 16.4 17.2 l6.7 18.7 Price (cents/gran) 9 7 8 9 10 8 9 9 9 8 8 Books - Value (US$ in.) 2.6 3.1 3.6 4.3 6.4 6.5 5.7 7.8 11.8 12.3 lh.1 Coer Wire - f 0.4 0.4 0.5 1.4 1.7 1.0 2.5 5.8 1.1 3.4 7.8 Glass & Glass Manufacture - "n 1.7 2.0 2.4 3.2 3.3 4.6 4.8 4.3 3.4 6.2 7.4 Cotton Thread - " 0.1 2.0 3.3 2.3 1.9 0.4 1.2 13.5 5.3 5.7 7.0 Pharmac eutical Products - 2.4 2.9 2.9 3.1 2.8 3.4 4.3 4.9 5.5 6.1 6.9 Tiles - " " 2.2 2.5 2.5 2.7 3.0 3.7 4.7 4,3 3.9 4.9 4.4 'Ettn fabricil - " 1.1 3.7 8.4 6.6 4.2 1.5 1.5 7.8 7.5 2.0 4.1 Silk Thread - " " 1.1 0.5 0.8 1.3 0.7 0.4 0.1 0.2 0.8 2.6 2.8 Cotton astage - " 3.7 2.2 3.0 2.9 3.6 3.0 2.6 3.5 14.0 3.6 2.3 Heneuen Textiles - " " 0.5 0.8 1.0 1.3 1.9 1.6 1.6 2.0 1.6 1.8 1.9 Barium Sulphate - " 2.3 2.0 1.6 3.1 2.0 2.5 3.1 2.9 1.7 1.5 1.8 Film= - " " 0.8 1.0 1.0 0.8 1.1 1.1 1.1 1.0 1.1 1.2 1.2 !jachine:y & Equipment - " -- -- -- -- -- -- 3.5 3.8 4.8 1.5 19.6 Automobile Parts - " " -- -- -- -- -- -- 0.7 1.0 2.2 4.3 17.3 Radio & TV Aprtus - " " -- -- -- -- -- -- 0.03 0,02 0.03 0.3 12.2 Copper Utensils - "-- -- -- -- -- -- 4.1 9.1 2.5 4.4 9.6 Electrical ient - -- -- -- -- -- 0.3 0.7 1. 4 2.2 8.2 Furniture - " -- -- -- -- -- -- 6.1 5.6 6.1 7.3 8.2 2adio & TV Parts - "o -- - -- -- -- -- 0.4 3.1 3.4 2.6 5.0 ratus (Mechanical) - " -- -- -- -- -- -- 3.1 1.8 1.9 1.7 4.4 Plastic Products - -- -- -- -- -- -- 0.2 0.3 0. 4 1.7 4.1 Airplane Parts - " " -- -- -- -- -- - 0.3 1.2 2.2 1.4 4.0 Metal Dust - -- -- -- -- -- 2.6 1.1 1.9 3.0 2.7 husical Instru- ments -- -- -- -- -- -- 0.6 0,7 1.0 1.8 2.1 Metal Jewelry - " " -- -- -- -- -- 0.9 1,0 0.9 1.4 2.1 Typewriters - " " -- -- -- -- -- -- -- 0.3 1.1 1.4 Paint-& Varnish - " " -- -- -- -- -- -- 0.8 1.0 1.1 0.8 1.4 Cardboard - " " -- -- -- -- -- 0.14 0,5 0.5 0.6 1.3 Silver Jewelry - " -- -- -- -- -- -- 0.6 0..8 0.9 1.2 1.1 ronze & Copper Frames - " -- -- -- -- -- -- 0.5 0.6 0.5 0.6 1.0 Others 13.8 15.7 20.7 23.7 28.7 23.6 29.3 32,1 39.3 28.2 49.2 TOTAL 43.8 49.9 65.7 75.3 91.1 74.9 11u.7 151,3 146.0 163.8 256.1 Total (A + B + C + D + E) 711.3 73å.9 787.3 863.9 874.4 953.6 1,o56.14 1,126.0 1,046.6 1,122.6 1,345.9 Inclassified 11.7 3.8 16.2 35.6 61.5 68.8 57.5 36,8 57.2 58.1 32.1 TOTAL EXPORTS-OF MERCHANDISE 723.0 738.7 803. 5 899.5 - 935.9 1,022..4 1,113.9 1,162.8 1,103.8 1,180.7 1,378.0 Note: (-) signifies non-availability of individual breakdown for these cormodities. They are, however, included in the 'Others" category, and are the best estimates available. Source: Bank of Mexico.  Table 3.6: STRUCTIURE OF MERCHANDISE EXPORTS, 1960-1969 (In percentages) 966651967 135W 1969 Cotton 21.4 19.9 24.3 20.9 16.6 19.0 19.1 13..0 1..4 16.7 Sugar 7.2 8.6 4.8 6.4 7.5 5.3 h.9 6.1 7.2 6.6 Tomatoes 3.5 1.8 2.2 2.6 3.3 3.2 5.4 4.5 h.9 6.1 Coffee 9.7 8.9 7.8 5.2 9.3 6.6 7.2 5.5 6.6 5.7 Cattle 4.5 5.2 5.9 3.9 2.2 3.4 3.6 3. h.8 h.8 Shrimp 4.6 5.h 5.1 5.5 5.2 3.8 4.6 5.6 14.2 3.3 Corn 3.0 - - - 1.6 6.9 )4.0 6.6 3.9 3.2 Sulphur 3.8 3.6 3.4 3.7 3.7 3.0 3.9 4.3 1.8 3.0 Zine 3.0 2.6 2.5 2.5 3.h 3.4 3.2 3.2 3.1 2.9 Meat 1.3 2.0 2.1 2.9 1.8 1.5 2.2 1.8 2.8 2.8 Oil 1.8 3.1 3.5 3.2 2.9 2.8 2.6 2.7 2.2 2.3 Fruits and Vegetables 1.3 1.5 1.4 1.5 2.1 1.8 2.6 2.3 2.1 2.2 Flourite s 1. 1.5 1.h 1.5 1.6 1.6 1.6 1.-5 1.9 1.9 Lead Bars 4.5 4.6 2.9 2.9 2.2 2.5 2.h 2.2 1.9 1.6 Iron and Steel Products 0.4 0.2 0.4 1.6 1.0 1.2 1.0 0.9 1.4 1.5 Hormone s 1.1 1.6 1.7 1.6 1.1 1.2 1.h 1.6 1.4 1.h achinery and Equipment - - - - - 0.3 0.3 0.4 1.2 1.4 Autonobile Parts - - - - - 0.1 0.1 0.2 0.4 1.3 Books 0.4 0.4 0.5 0.7 0.6 0.5 0.7 1.1 1.0 1.0 Wheat - - - 0.5 3.5 3.7 0.3 1.1 -- 0.9 Molasses 0.7 0.5 0.3 1.0 1.3 1.3 0.8 1.3 0.9 0.9 Lead Oxide 0.4 0.4 0.5 0.6 0.7 0.8 0.7 0.7 0.7 0.9 Chemical Products 0.1 0.1 0.2 0.4 0.3 0.4 0.6 0.8 0.7 0.9 Copper Bars 3.4 2.4 2.7 2.4 1.3 0.7 0.7 0.6 0.6 0.7 Henequen 2.4 2.5 2.4 2.7 2.3 1.5 1.2 1,1 0.7 0.7 Sub-Total 79.8 76.8 76.3 74.2 75.5 76.5 74.2 72.5 73.8 72.7 Others 20.2 23.2 23.7 25.8 24.5 23.5 25.8 27.5 26.2 27.3 TOTAL EXPORTS OF MERCHANDISE 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Source: Table 3.5, Commodity Fxports.  /1 1 Table 3.7: EXPORTS - GROW-1H EL04S,-UNIM01u (value in U.S. $an.) uYnamic Stagnant Item Value 1969 Item Value 1969 Tomatoes 83.9 Cotton 203.2 Cattle/2 ob.y Shrimps 4-.3 Corn/2 43.6 Oil 31.7 Meat 39.0 Lead 2-c. Mercury/2 36.5 Henequen 10.2 Fruits and Vegetables JU.4 Copper Yo. Flourite 25.6 Natural Gas 8.0 Iron and Steel 20.8 Harmones 18.7 Books 14.1 Chemicals 12.7 Lead Oxide 12.5 Percentage of Exports 29.3 23.9 /1 Classified according to growth 1959 to 1964 and 1964 to 1969. Exports growing faster than GDP in both periods are classified as dynamic, those growing slower in both periods are classified as stagnant. /2 Indicates items exhibiting growth faster than GDP since 1964, but stagnant in 1959-64. 16.9 percent of exports, not listed above, exhibit growth faster than GDP in 1959-1964 followed by stagnation since 1964. The remaining 29.9 percent of exports are in products without significant individual value. Source: Mission estimates. Table 3.8: PROJECTION OF MAJOR COMMODITY EXPORTS, 1969-1975 (Values in US$ millions) Commodity Value 1969 Value 1975 Notes Gold and Silver 64.0 100.0 Revival due to higher sil- ver price. Cotton 203.2/1 196.6 To reach 1966 volume by 1975 with price drop of 15%. Coffee 78.9 88.9 Growth by 2% per annum. Sugar 91.4 119.0 4.5% per annum. Shrimpo 45.3 69.8 37,500 tons by 1975. Metals (Zn, Pb, Hg, Cu) 84.4 120.0 Industry now recovering. 6% growth assumed. Tomatoes 83.9 113.0 5% per annum. Cattle 65.9 75.0 One million head at $75 per head. Sulphur 42.0 20.0 Sharp deterioration to residual level of $20 mn. Oil and Products 31.7 40.1 h% growth (historical rate 1959-1969). Fruits and Vegetables 30.4 40.0 To reach 500 million pesos by 1975 (4.7% growth). Fluorite 25.6 42.9 To double by 1978 (9% P.a.) Hormones 18.7 30.5 8.5% (volume growth 1960-1969). Iron and Steel Products 20.8 28.0 To reach 350 million pesos by 1975 (5%). Meat 39.0 45.2 Growth by 2.5% per annum. Other 524.8 880.1 Rate of growth of 94 (historical rate 11.19). TOTAL 1,650.0 2,009.1 Rate of Growth 1969-75: 5.59% /1 1969 abnormally high due to export of stocks, 1968 value $170.3 million. Source: Mission estimates. Table 3.9: COMMODITY I4PORTS, 1960-1969 (Value in US$ million) I. Consumer Goods Page 1 of 1960 19ý61 1962 1963» 1966 1965 1j96 196, 1968 q199 Condensed and Powdered Milk 5.9 5.5 7.6 10.3 11.2 6.1 9.5 11.3 10.0 10.6 Drugs and Pharmaceuticals 14.0 11.6 13.3 13.1 12.h 16.0 7.7 3.h 2.6 2.6 Books 2.9 ý.5 3.8 4.4 - 10.2 14. 15.3 10.5 12.1 Passenger Cars 58.2 59.2 65.6 78.2 105.7 98.9 78.8 78.2 95.4 103. Motors and Part Motors 7.2 9.2 6.1 8.0 - - 2.7 3.1 2.6 4.0 Automobile 'Parts and Replacements 34.0 33.9 32.1 35.4 41.7 52.8 55.9 51.6 55.1 60.8 Radio and W Parts 5.2 3.9 2.9 2.7 - - - - 18.6 18.5 Others 84.7 95.5 97.5 130.5 129.0 l.5 118.3 122,.9 149.1 178.2 TOTAL 212.1 222.3 228.9 282.6 300.0 298.5 287.3 285.8 3h3.9 390.1 Table 3.9 - Cont. II. Producer Goods 1960 - 9l)- - (-963 --1TTZ14 l-96 1'~ 9 7 9~l~ A. Raw Materials and Auxiliary Materials Hides and Skins 5.5 4.7 1.8 4.5 9.1 10.8 9.7 15.9 14.0 15.9 Animal Fodder 10.0 - - 6.2 13.6 17.8 16.1 9.5 11.0 11.0 Natural Crude Rubber 19.9 19.1 19.1 19.7 14.j 24.4 26.3 20.0 15.7 19.0 Chemical Fertilizers 24.7 22.9 18.0 17.8 23.0 12.2 10.0 11.3 14.2 8.9 Color and Varnish 10.7 9.9 5.9 7.2 12.0 13.2 10.6 10.6 9.7 9.9 Natural and Artificial Gas 7.7 - - 12.0 1.9 16.8 20.4 23.2 21.3 20.8 Insecticides and Parasiticides 8.0 9.0 1h.0 10.9 - 9.7 6.3 5.1 12.8 13.4 Iron and Steel Sheets and Plates 6.3 6.5 6.3 7.2 9.2 9.5 7.4 9.3 9.8 12.7 Wool 10.1 10.0 11.14 12.5 20.8 23.0 20.2 22.0 20.6 21.3 Mixture for Industrial Use ) - - - 27.6 32.9 Mixture for Pharmaceuticals ) 14.7 13.6 17.8 17.3 18.9 Wfite Newsprint 13.6 12.4 114.4 13.3 14.7 14.0 14.9 17.8 17.0 20.4 Paper, Cartons and Cellulose 32.9 1 35.1 35.7 40.9 30.9 36.8 38.7 33.0 142.6 Scrap 15.9 114.7 10.8 15.0 27.1 32.3 29.9 32.8 22.4 23.6 Natural and Synthetic Resins 11.2 11.5 10.0 14.6 14.9 16.8 23.8 15.6 16.7 21.6 Ether and Ester 4.6 5.1 .4 5.3 - - - - 13.6 14.4 Antibiotics 14.5 10.2 14.0 19.3 - - - - 15.6 16.0 Aluminium Cables and Wire 0.3 1.6 3.4 6.9 - - - - 8.8 10.7 Pig Iron and Ingots 0.2 - - 0.1 4.4 7.2 10.6 16.5 12.1 Oil and Lubricant - - - - - - - 8.9 8.1 Combustibles (Fuel) - - - - - - - - 2.4 1.9 Gasoline - -- - 1.9 7.14 Phosphorous - - - - - - - - 6.9 6.2 Antimony Oxide 3.3 3.1 3.3 3.5 - - - - 11.7 6.3 Others 178.7 183.7 175.1 171.4 :240.3 300.2 322.4 326.2 272.9 313.1 TOTAL 1404.0 380.8 378.14 415.9 487.4 550.7 575.6 586.b 622.3 691.1 Table 3.9 - Cont. Page 3 of 3 B. Investment Goods Locomotives 26.0 17.0 17.7 20.2 30.2 9.5 2.0 7.3 6.9 13.0 Rolling Stock 12.4 15.4 9.2 5.8 8.7 9.4 5.7 8.6 74,0 9.7 Parts for KIectrical Installations 9.2 - - 7.3 11.8 14.8 17.3 19.5 27.4 35.2 Iron and Steel Elbows, Connections 3.4 - - 2.8 3.0 b.0 5.8 9.6 8.2 13.3 Hand Tools 7.0 8.9 7.6 7.7 9.2 8.2 10.0 10.9 12.3 12.3 Tractors 22.0 17.7 16.9 24.3 35.4 32.5 21A4 20..3 20.2 27.0 Tractor Parts and Replacements 14.9 14.2 14.5 20.0 17.9 1.9 9.11 11.9 11.4 11.5 Telephonic and Telegraphic Equipment and Spare Parts 8.3 - - 9.7 16.3 23.3 30.6 43.7 56.9 39.7 Automolbile Chassis 13.0 10.0 8.8 14.8 14.3 38.2 31.8 36.4 59.1 50.0 Road Rollers and Graders 9.8 6.1 6.8 13.1 13.9 16.9 21.1 41.3 37.1 43.5 Mining Apparatus 8.4 7.1 8.3 3.9 - - - - 4.6 4.1 Scientific Apparatus 5.5 6.4 5.3 5.6 - - - - 7.2 6.8 Agricultural Machinery 4.7 7.1 7.4 8.3 - - - - 11.5 11.8 Electric Motors and Generators 6.8 5.2 10.4 6.7 - - - - 8.5 11.5 Airplane Parts and Replacements 13.7 7.8 10.1 9.1 - - - - 42.7 22.8 Valves and Wrenches 5.6 6.2 6.6 3.1 - - - - 8.7 8.7 Refined Metal and Other Material for Machinery [6.7 48.4 49.3 40.8 - - - - 39.9 50.2 Bearings, Rowloaks, Pulleys, etc. - - - 8.8 17.7 20.7 1b.9 8.1 17.0 19.9 Trucks 36.0 - - 39.9 58.9 10.4 9.3 11.4 8.9 12.1 Water Pumps - - - - - - - - 6.7 13.0 Combustion Motors - - - - - - 29.6 24.6 Textile Machinery - - - - - - - - 35.9 51.2 Textile Machinery Parts - - - 4.5 4.8 Industrial Kilns - - - - - - - - 13.6 10.2 Printing Machinery - - - - - - - - 10.0 13.7 Machinery (no specification) - - - - - - - - 16,59 162.8 Others 318.9 157.8 356.8 289.3 468.3 520.6 563.3 66.0 332.3 317.6 TOTAL 570.4 535.5 535.8 541.2 705.5 710.4 742.3 876.0 99L.0 996.0 Total Dmort of Merchandise 1,186.1 1,138.6 11.0 ,l219.7 1 491.0 1,55s? 6 1,605.2 1,432 L290.2 2,078.0 Note: (-) Individual breakdown for these commodities not available. These are, however, included in the 'Others' category. Source: Anuario Estadistico de los Estados Unidos Mexicanos; Mexico I PiaiILuggLjinLb Banco Nacional do omercl; Iterior, S.A. and Mission estimates.  Table 3.10: VALUE OF IMPORTS OF COMMODITIES BY ENID-USE, 1959-1969 (MiliLons of dollars) 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 TOTAL 1 006.6 5 186.4 1 3.6 L 14~.1 2I9.1 49 L.0 6 59.6 i 60).2 1 748,8 1 960.1 2 078.0 I. Consumer Goods 193.4 212.1 222.3 228.9 282.6 300.0 298.5 287.3 285.8 343.9 390.1 A. Non-Drables 65.4 72.1 84.4 78.1 116.7 88.9 88.9 85.8 94.4 97.3 115.3 1. Food and Beverages 32.0 33.4 27.5 35.9 70.5 39.9 31.6 43.4 42.3 35.5 40.6 a. Unmanufactured or semi-manufactured 17.3 15.9 10.0 13.4 42.0 13.2 12.7 11.7 10.3 11.4 13.1 b. Manufactured 14.7 17.5 17.6 22.4 28.5 26.7 18.9 20.7 32.0 24.1 27.5 2. Non-Edible Goods 33.4 38.7 56.9 42.2 46.2 49.0 57.4 53.4 52.2 61.7 74.8 B. Darables 128.1 140.0 137.9 150.8 165.8 211.1 209.6 201.5 191.4 246.6 274.8 II. Producers Goods 813.2 974.4 916.4 914.1 957.1 1193.0 1261.1 1317.9 1462.5 1616.2 1687.9 A. Raw Materials and Fuels 368.0 404.0 380.8 378.4 415.9 487.4 550.7 575.6 586.4 622.3 691.1 a. Unmanufactured 50.6 53.2 55.0 54.1 62.7 79.1 88.8 86.0 76.3 79.2 91.3 b. Manufactured 317.3 345.8 325.8 324.2 353.2 408.4 461.9 489.6 510.1 543.1 600.6 3. Investment Goods 445.2 570.4 535.5 535.8 541.3 705.5 710.4 742.3 876.0 994.0 996.0 1. Agricultural (Breeding stock, seeds, etc.) 11.9 11.1 10.6 11.9 14.0 13.7 13.8 15.7 17.0 17.5 19.7 2. Construction materials 33.2 68.4 55.4 60.3 57.7 71.0 79.8 76.8 87.5 91.6 109.8 3. Spares 102.6 108.1 107.3 92.2 80.0 83.8 114.8 143.5 144.3 140.2 163.7 4. Machinery, equipme:nt and vehicleø 297.5 382.7 362.3 371.4 38.6 537.0 501.9 506.2 627.3 744.6 702.9 a. Agricultural 37.9 43.1 40.3 39.9 53.9 66.0 48.3 45.3 35.6 43.5 43.2 b. Transport and telecommunications 80.5 125.9 102.4 126.6 122.8 169.8 129.0 125.7 187.4 265.7 205.7 c. Industrial, commer- cial and others 179.1 213.7 219.5 204.8 212.9 301.2 324.6 335.2 4o4.3 435.4 453.9 Sources Bank of Mexico  'P1~1 ) 1 ~ 'T~T,~TW n'M fV 'AX9XT1.Iflfl I flen 1 i nAn (In percentages) Year Total Consumption Fuels and Capital Goods Mbew Ma raUw-L -1 %- ous 1959 100.0 19.2 36.5 44.3 1960 100.0 17.9 34.1 48.o 1961 100.0 19.5 33.4 47.1 1962 100.0 20.0 33.1 46.9 1963 100.0 22.8 33.5 43.7 1964 100.0 20.1 32.6 47.3 1965 100.0 19.2 35.3 45.5 1966 100.0 17.9 35.9 46.2 1967 100.0 16.4 33.5 50.1 1968 100.0 17.5 31.8 50.7 1969 100.0 18.8 33.3 47.9 Source: Bank of Mexico. Table 3.12: STRUCTURE OF IMPORTS IN RELATION TO CONSUMPTION, GNP AND GROSS INVESIMENT, 1960-1969 (In Mex.$ millions) -17-F2FTT 7_T-(6Tr y Ti_ (15 - Imtp. Im.rp. Imp. of non of Imp. Total Total of dura. dura. % fuels & % Gross Imp. of % (2)+ % Year consump- cons. consa cons. (2)/ (3)/ (W)/ raw- (9)1 fixed capit. (12)/ (9)+ (1:)/ tion goods goods goods (1) (1) (1) GNP mat. (8) invest. goods (11) (12) (8) 1960 129,200 :2,651 901 1,750 2.05 0.70 1.35 148,500 5,050 3.ho 23,200 7,130 30.73 14,831 9.99 1961 139,600 2,778 1,055 1,723 1.99 0.76 1.23 160,900 4,760 2.96 214,100 6,694 27.78 14,233 8.85 1962 150,100 2,861 976 1,885 1.91 0.65 1.26 173,C000 4,729 2.73 214,800 6,697 27.00 14,,288 8.26 1963 167,200 3,532 1,459 2,073 2.11 0.87 1.24 192,600 5,198 2.70 28,ooo 6,766 24.16 15,496 8.05 196, 195,6oo 3,750 1,112 2,638 1.92 0.57 1.35 227,200 6,093 2.68 36,700 8,819 24.03 18,662 8.21 1965 213,100 3,737 1,112 2,625 1.75 0.52 1.23 274,4oo 6,888 2.51 39,000 8,875 22.76 19,500 7.1l 1966 234,200 3,588 1,075 2,513 1.53 0. 46 1.07 275,200 7,200 2.62 b.65,6oo 9,275 20.34 20,062 7.29 1967 2514,400 3,572 1,180 2,392 1.4o 0. 46 0. 298,600 7,330 2.45 52,900 10,950 20.70 21,853 7.3:2 1968 280,100 4,298 1,216 3,082 1.53 0.43 1.10 331,400 7,779 2.35 60,500 12,p424 20.54 24,,501 7.39 1269 309,500 4,876 1,441 3,435 1.58 0. 47 1.11 367,100 8,639 2.35 66,400 12,450 18.75 25,965 7.07 Source: :Bank of Mexico TaDle ?.I?: VALUE U IMUPOTS UF MERUANiSE BY ULAU AD PRIVATE SETUTU, 19){-1909 (Thousands of dollars) Year Total Private Public 1957 1,155,153 899,239 255,914 1958 1,128,637 908,167 220,470 1959 1,006,609 879,717 126,892 1960 1,186,4h8 975,406 211,042 1961 1,138,663 911,970 226,663 1962 1,143,000 903,258 239,742 1963 1,239,687 995,486 244,201 1964 1,492,950 1,213,520 279,430 1965 1,559,608 1,302,750 256,858 1966 1,605,167 1,328,485 276,682 1967 1,748,263 1,339,751 408,512 1968 1,960,111 1,568,545 391,566 1969 2,078,032 1,662,930 415,102 Source: Bank of Mexico. Table 3.14: VALUE OF IMPORTS TO BORDER ZONES AND TO THE INTERIOR, 1960-1969 (Thousands of dollars) Border Year Total Interior Zones 1960 1,186,h8 1,076,946 109,502 1961 1,118,633 1,033,610 105,023 1962 1,143,000 1,027,806 115,194 1963 1,239,687 1,124,489 115,198 1964 1,492,95o 1,375,334 117,616 1965 1.559.608 1.hb3,129 116,279 1966 1.6o5.167 1.480.000 125.167 1967 1,748,263 1,603,637 144,626 1968 1.960.112 1.779.63 180.6L9 1969 2,078.032 1.82h.793 253.239 Source: Bank of Mexico. Tab]e 3.15: TOURISM AND :BORDER TRADE - Millions of Dollars - Year NO of Tourists R e c e i p-t s Expenditures Net Receipte Visiting Interior From Visits From ]Border Total by Mexicans Outside Mexico From Tourisvi (00) to interior Trade Border Trade Other Total and Border Trade 1960 787 155.3 366.0 521.,3 221.0 40.5 261.5 259.8 1961 B59 164.0 392.7 556.7 242.0 45.5 287.5 269.2 1962 958 178.6 406.7 585.3 244.6 65.5 310.1 275.2 1963 1 081 210.6 445.9 656.5 265.2 84.3 349.5 '307.0 1964 1 239 240.7 463.3 704,.0 276.6 100.1 376.7 .327.3 1965 1 395 274.9 499.5 774.4 295.2 119.1 414.3 360.1 1966 1 546 328.4 546.6 875.0 342.8 136.0 478.8 396.2 1967 1 674 363.1 599.6 962.7 359.1 162.6 521.7 441.o 1968 1 937 431.9 713.5 1 145.4 45o.4 193.5 643.9 501.5 1969/2 2 137 465.2 744.3 1 209.5 480.1 234.1 714.2 495.3 ýj Border trade includes expenditures of touriets crossing the border on 72:-hour permits, purchase and sales of merchandise on a small scale and salaries and wages of individuals employed on the opposite sidle of the border from their place of residence, and excludes export and import traxnsactions in commercial quiantities. 2 Preliminary figures. Smurce: Bark of Mexico Table 3.16: NET FACTOR INCOME PAYMENTS TO THE REST OF THE WORLD (Millions of US dollars) C r e d i ta D e b i t e Interest Pay-ments Net Factor i- Migrant Interest Direct LFreight come Payments Workers Film Earn- Investment Tem. Film Car to the Rest Remittances Rentals ings.l/ Total Income2/ Total Public Other Rentals Rentals Total of the World 1950 19.4 3.5 - 22.9 66.0 14.1 14.1 3.3 5.0 88.4 - 65.5 1951 29.6 2.7 - 32.3 101.6 13.8 13.8 3.8 4.9 124.1 - 91.8 1952 28.9 5.6 - 34.5 107.6 15.2 15.2 4.2 3.0 130.0 - 95.5 1953 33.7 5.0 - 38.7 82.9 16.3 16.3 3.9 6.3 109.4 - 70.7 1954 27.9 4.1 - 32.0 75.3 16.0 16.0 3.3 5.4 100.0 - 68.0 1955 24.8 4.1 - 28.9 79.6 21.5 21.5 4.1 6.1 111.8 - 82.4 1956 37.7 4.4 - 42.1 120.1 25.8 25.8 4.7 7.7 158.3 -116.2 1957 33.2 4.7 - 37.9 117.3 30.7 30.7 4.6 7.4 160.0 -122.1 1958 35.7 5.2 - 40.9 1:22.6 37.0 37.0 5.1 8.3 173.0 -132.1 1959 37.8 8.6 - 46.4 128.6 40.8 40.8 7.3 5.1 181.8 -135.4 1960 36.1 4.7 - 40.8 141.6 48.9 48.9 4.5 5-3 200.3 -.159.5 1961 34.2 4.4 - 38.6 148.1 56.4 56.4 4.4 4.7 213.6 -175.0 1962 31.9 3.8 - 35.7 159.3 77.8 77.8 4.4 3.5 245.0 -209.3 1963 30.8 4.0 - 34.8 185.6 80.3 80.3 4.9 3.9 274.7 -239.9 1964 28.9 5.5 - 34.4 2:36.1 87.6 72.0 15.6 - 5.2 328.9 -294.5 1965 12.1 5.0 - 17.1 236.1 102.7 88.3 14.4 - 5.6 344.4 -327.3 1966 11.4 6.0 18.5 35.9 277.4 136.2 91.5 44.7 0.7 5.4 419.7 -383.8 1967 12.9 6.0 24.2 43.1 321.4 174.9 113.2 61.7 0'.7 5.9 502.9 -459.8 1968 15.0 6.0 35.5 56.5 375.9 218.8 144.1 74,.7 0.7 6.3 601.7 -545.2 1969 18.9 6.0 46.1 71.0 410.7 229.4 151.1 78,3 0.7 6.6 647.4 -576.4 li Combined pueblic and private. 2/ Gross of reinvestment (Standard definition). Source: Bank of Mexico, IBRD Statistical Services. Table 3.17: OTHER INCOEffi AND EXPENDITURES AND TRANSFERS ON CURRENT ACCOUNT (Millions of US dollars) C r e d i t s D e b i ts Trans fers Other Private Government Other Total Private Government Other Total (Net) 1950 3.2 15.9 7.9 27.0 4.9 0.5 10.2 15.6 +11.4 1951 3.5 7.9 9.0 20.4 4.9 0.8 13.8 19.5 + 0.9 1952 3.0 4.5 9.0 16.5 5.0 c).8 10.0 15.8 + 0.7 1953 2.7 5.6 9.2 17.5 6.0 0.9 13.4 20.3 - 2.8 1954 2.7 5.7 11.3 19.7 11.5 1.2 14.6 27.3 - 7.6 1955 3.0 2.6 14.2 19.8 7.7 1.2 13.9 22.8 - -3.0 1956 3.8 2.7 13.7 20.2 7.5 1.4 14.3 23.2 - 3.0 1957 3.4 3.3 12.4 19.1 3.4 1.4 14.4 19.2 - 0.1 1958 2.8 2.8 13.1 18.7 4.8 1.5 14.1 20.4 - 1.7 1959 2.9 3.4 15.1 21.4 6.8 1.8 18.4 27.0 - 5.6 1960 5.3 4.2 13.8 23.3 13.5 2.4 1,8.8 34.7 -11.4 1961 5.7 3.3 14.8 23.8 22.0 1.9 20.3 44.2 -20.4 1962 4.5 3.8 13.5 21.8 21.2 2.4 21.5 45.1 -23.3 1963 4.8 2.9 23.1 30.8 21.0 3.6 26.8 51.4 -20.6 1964 8.1 2.0 30.9 41.0 17.1 3.6 30.7 51.4 -10.4 1965 10.3 2.2 26.9 39.4 16.1 2.3 28.1 46.5 - 7.1 1966 10.2 7.6 45.0 62.8 14.5 4.5 28.2 47.2 +15.6 1967 16.2 7.9 29.4 53.5 11.4 5.2 28.7 45.3 + B.2 1968 19.8 8.4 26.3 54.5 7.1 7.5 28.5 43.1 +11.4 1969 19.8 8.6 27.5 55.9 6.2 9.2 27.8 43.2 +12.7 Source: Bank of Mexico. Table 3.18: MAJOR COMMODITY EXPORTS TD L.A.F.T.A. REGION, 1966-1969 (Value in US$ million) Commodity 19bb 19b7 196 1969 Books 4.5 7.2 8.0 9.0 Zinc (Refined) 3.4 3.2 5.3 7.3 Auto Parts 0.4 1.6 1.6 5.1 Cotton Seed 5.4 7.4 4.9 4.0 Iron & Steel Products 0.4 0.5 0.2 4.7 Iron & Steel Tubes 3.9 1.8 3.0 4.0 Resin 2.0 2.6 3.3 3.9 Organics & Minerals for Industrial Use 4.2 3.8 3.1 3.4 Lead (Refined) 1.4 1.1 2.3 1.8 Radio & Laboratory Apparatus 1.2 1.11 1.5 2.2 Machinery 0.1 0.7 0.1 1.7 Sodium Phosphate 1.1 2.3 1.6 1.3 Corn for Human Consumption - - 1.6 - Specific Material Parts 0.8 1.0 1.0 1.4 Lead Oxide 0.7 0.7 0.8 1.3 Motor Transmission Parts 0.1 0.1 0.3 1.2 Typewriters - 0.2 0.8 1.2 Iron & Steel Structures - - 0.5 1.2 Polibutadienoestireno (Solid) - 0.1 0.8 1.1 Hormones (Natural & Synthetic) 1.1 1.3 0.9 1.1 Iron & Steel Containers 0.3 0.4 0.3 1.1 Bean 11.2 0.8 - - Total Above Items ;;42.2 38.2 41.9 58.0 Others 22.2 19.0 20.3 28.2 TOTAL EXPORTS 64.4 57.2 62.2 86.2 Source: Anuario Estadfstico de los Estados Unidos Mexicanos, Datos de la Direcci6n General de Estadistica, SIC, reagrupados por el Departa- mento de Comercio Exterior del Banco de M4xico, S.A. Table 3.19: MAJOR COMMDDITY IMPORTS FROM L.A.F.T.A. REGION, 1966-1969 (Value in US$ million) Commodity __1966 1967 1967 _ 1969 Fish Powder 7.9 7.0 8.1 10.4 Wool 3.9 3.5 3.8 Paper Paste - 2.4 2.0 3.6 Blank Paper (80% Wooden Paste Contents) 3.5 4.1 3.4 0.8 Tin Mineral 0.2 0.1 1.9 1.3 Gas and Diesel Oil 1.0 - - 1.9 Iron & Steel Desbastos 0.0 0.4 0.2 1.8 Quebracho Extract 1.0 1.0 1.1 1.5 Fabricatine Paper O.L 0.6 0.9 1.h Books 0.7 0.7 1.3 1.1 Snowflake Cathodic Tubes - 0.6 1.0 1.2 Calculating & Similar Machines 0.2 1.0 1.2 1.0 Sodium Nitrate 0.9 0.9 1.2 1.0 Stearine (Acid) 0.2 0.6 1.0 0.8 Tvnewriters 0-9 0.- 0b 1 Total Abovp Ttmq Pn - ? A 27-9 1?_A 0t.hPrs Q. 11 1 TC 19.2 TfTAr Tmnp. 0 a TIOTATL IMPORTS c 29o 11..o 1. A 4.8 Direccibn General de Estadistica, SIC, reagrupados por el Departa- d,+-e COMr-o -Etro de Banco "ft Mexi-0.02 Table 3.20: EXPORTS TO L.A.F.T.A. COUNTRIES (Value in US$ million) Country 196 191 16°~16 96 16 96 16968- 1969ý Argentina 0.6 1.1 2.3 2.5 8.5 7.h 9.6 9.4 10.5 14.0 Bolivia 0.2 0.05 0.1 0.2 0.1 0.2 0.4 0.5 0.7 0.9 Brazil 1.2 1.8 7.6 10.1 5.6 5.4 19.6 11.6 13.0 14.6 Colombia 1.2 1.8 1.7 3.9 5.3 5.5 8.3 3.7 6.3 20.1 Chile 1.h 1.5 2.3 5.0 9.5 12.3 11.7 lh.1 12.2 12.0 Ecuador 0.h 0.6 0.6 0.9 1.0 1.3 1.1 1.2 1.7 1. Paraguay 0.02 0.03 0.02 0.05 0.1 0.1 0.2 0.2 0.3 0.3 Peru 0.7 0.8 1.7 3.0 2.8 3.5 4.6 5.9 4.8 5.9 Uruguay 0.1 0.2 0.5 0.5 1.2 0.8 1.7 1.5 1.5 1.6 Venezuela 2.9 3.1 4.4 5.7 11.6 7. 7.2 9.0 11.1 15.3 TOTAL B.7 11.0 21.2 31.8 >57 43.9 644 57. 2 62.2 86.2 Source: Anuario Estad'stico de los Estados Unidos Mexicanos. Table 3.21: IMPORTS FROM L.A.F.T.A. COUNTRIES (Value in IJS$ million) Country 1960 1961 1962 1963 96 L1966 1967 1968 196 Argentina 1.2 1.3 1.6 3.0 h-9 7-8 9.5 10.8 11.0 12.4 Bolivia 0.1 - - - - 0.1 0.3 0.1 1.9 1.3 Brazil 0.1 0. 2 -0.3 0.1 3.6 11.1 7.h 7.2 9.3 ll-h Colombia 0.2 0.2 0.2 0.2 0.3 0.5 0.9 o.4 0.7 0,6 Chile 0.8 0.4 0.6 1.5 2.b 3.5 5.8 9.5 8.6 8.3 Ecuador - - - 0.03 0.02 0.2 0.5 1.2 0.6 0.8 Paraguay 0.1 0.05 - 0.02 0.01 0.02 0.1 0.2 0.1 0.4 Peru 0.9 1.2 2.0 3.7 h.7 h.8 8.1 7.3 8.6 10.9 Uruguay 0.3 0.8 1.5 1.h 1.3 1.7 1. 1.6 1.9 1.6 Venezuela 0.2 0.4 0.2 0.6 2.1 0.2 0.9 0.2 0.1 4.0 TOTAL 3.9 4.5 6 - 1. 19.3 29.9 3_.9 38.5 42.8 51.8 Source : Anuario Estadístico de los Estados Unidos Mexicanos.  REVISED Table 4.1: MEXICO - EXTERNAL PUBLIC DEBT OUTSTANDING AS OF DECEMBER 31, 1969 /1 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) Page 1 Debt outstanding Source December 31, 1969 Disbursed Including only undisbursed TOTAL EXTRNAL PUBLIC DEBT 2,963,486 3,511Z36 Privately held debt 1,740,163 1,882,096 Publicly-issued bonds 309,947 309 947 Supliers h29.L93 . Be lgiwn 02,040 Canada 6,281 7,.760 Denmark 66 5,265 France 70,623 77.562 Germany 77,406 89,958 Italy 5-167 q.899 Japan 32,568 38,884 Netherlands hL,LI3 TOJ130 Sweden 272 272 SwitzArland C,814 8,9R0 United Kingdom 33,729 33,729 UnitArd SAtatAA 1A 871 1AA A7 Others 22,399 29,739 Pinnncin1 inq+Aitinna RAK TIh OAK <q< Bahamas 5d, 71718 Bae ri, -m al. R& f Canada 25,516 25,516 Der,wrk 1 7 ~77 '7 ~' France 11,073 63,911 Luxembourg 10,929 10,929 Net1.erldse ~n . Switzerland 6,739 16,120 United States 573,034 580,282 0) t Ah _- r s LUIV_,?VULV?V Privately-placed bonds 115,619 115,619 Loans from international organizations 619,367 889,377 10>505,905 655, 315 IDB 113,382 234,062 Loans from governments 580,263 716,180 Canada 44,791T M937 France 152.271 199.497 Germany 19,837 23,416 Italy 24,.016 38,331 Japan 12,043 15,894 See footnote at end of table. REVISED Table .1: MEXOO - EXTERNAL PUBLIC DEBT OUTSTANDING AS OF DECEMBER 31, 1969 /1 (CoNT.) Debt Repayable in Foreign Currency (In thousands of U.S. dollars) Page 2 Debt outstanding Source December 31, 1969 Disbursed Including only undisbursed Loans from governments (Cont.) United States 327,302 383,106 Social Progress Trust Fund 27,333 30.,581 AID, Eximbank, Others 299,969 352,h25 Nationalization 23,69 23,693 /1 Debt with an original or extended maturity of over one year. Statistical Services Division Economics Department July R. 1970 REVISED Table b.2: MEXICO - ESTIMATED FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT mlrr'TrAMnTMr. TWrnTT TrnT.RITHRn Aq OF nFrW.BWR 41 -0AQ Page 1 0PrT OUTST (BEGIN OF PERInD) PAYMENTS DURING PERI00 INCLUOTNG AMORTI* YEAR UNDISRURSED ZATION INTEREST TOYAL TOTAL EXTERNAL PURLIC ORT 197n 3'383,322 4270851 1840975 6t102A 1971 2#956p?6 350s583 1?3#440 524st22 1972 2P6050980 359,193 114#2?8 511*04 1973 2#247.99 357P211 1350409 4920619 1974 1889,986 331s655 Im8972 4ApA1 1975 105589P80 299,848 880901 388o49 1976 1s28*d32 169A597 7?qAA7q 1se4A1 - - * I - e - *-- - I A F ' W 1977 10118SP35 1510913 61#409 213#)23 1978 936PQ92 119s3AA 420MA teq.111 1979 797,54 1340679 4f?03 177.6t 1980 662A875 ItItMA %%An 1ailv19 19e1 549#107 80P194 29,157 9e)5 1982 4A8971 QAnan A.111* son..9 1983 372P933 115,196 19#163 134s)58 1984 777 709i0 a.31A a,-A- Note: includes service on all debt listed in Table 1 prepared- iuly 7, 197i with the exception of the following, for which repayment teras are not available: Total $128,024,000 Suppliers credits 3,699,000 Financial institutions 25,831,000 International organizations - IDB 13.514.000 Loans from governments Canada 4, .967. 000 France 16,986,000 Italy 382,000 Japan 5,895,000 United States 6.750.000 REVISED Tablel. 2: M.XICO - ESTIMATED FUTUR SERVICE IAIMENTS ON EXTERNAL PUBLIC UEBT OUTrSTANDING INCLUDING UNDISBURSED AS OF DECEMBER 31, 1969 (CONT.) Debt Repayable in Foreign Currency (In thousands of U.S. dollars) Page 2 nERT 0TST t@TGIN nr PERTnnl PAYMENTS MURING PERTnD INCLUDING AMORTIm VrAR UN InTrSE0 ZATION INTEREST TOTAL PRIVATELY-HELO DERT 1970 lpgn?#566 3099725 1170065 426p790 1971 1 .493,496 231,995 l*A09 333a803 1972 1#2610938 237*393 85,183 322*576 1973 1.02ft,856 234,461 71,127 305,58R 1974 790a93 216#492 50*810 267s30t 1975 573,k50 188*330 3A.72 9 1976 385620 74,047 p5o842 9908,8 197760,676 1p97 8427 1978 250-497 50s036 16.519 66.554 1979200861 49,O08 ¶2.556 6:6 1980 151,854 33#128 9,322 47#449 1981187 11,886 7,735 19.621 1982 106,840 30p550 6,385 360935 1983 76479 112Oq205:4 1984 259171 11,620 1,487 130107 PUBLICLV-ISSUED BONDS 1970 3n99947 14f781 20,635 35.415 1971 295p821 19,758 19#645 399403 1972 2760500 42.T85 17#621 604,06 1973 23AP026 23.220 15>435 38*656 1974 210*903 37298 139408 50970r 1975 173*554 21,633 ti353 32,986 1976 151>920 21.692 9,856 319548 1977 130228 21p753 8,355 30,09 1978 1n80474 21>821 60850 28,672 1979 869653 18*519 5,344 23#863 1980 68.134 10p887 49261 15 j47 1981 57>'A7 6933 3p645 10,78 1982 50,314 4p661 3,208 ?9ö69 1983 45s653 40p482 2,996 41.878 1984 5a71 1,620 283 1*903 REVISED Table 4.2: YXICO - ESTIMATED FUTURE SERVICE PAYMNTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSED AS OF DECEMBER 31, 1969 (CONT.) Debt Repayable in Foreign Currency (In thousands of U.S. dollars) Page 3 DEST MITST CBEGIN OF PERIOD) PAYMENTS DURING PERIOD INCLUDTNG AMORTIm YEAR UNDISPURSED ZATION INTEREST T_ OTAj PRITELY-HELD DEBT SUPPLIERS 1970 437P306 86#400 24.985 111ss84 O1 350x906 77v624 ?1P685 99J309 1972 273P281 58,390 17s178 750568 1973 2t4p891 549573 j3v746 68#319 1974 1A0*318 29s991 108767 40stfT 1975 130327 63P678 8.916 720595 J976 66,A48 23#067 3.637 26#703 977 43*582 14.690 2.194 16*884 1978 28.892 14.332 1.383 15.716 1079 14#559 6S*44 772 7,316 1980 8015 4,oR5 428 40513 1981 3P930 3m087 193 1982 A42 556 42 598 1983 986 286 12 299 FINANCIAL 1N'! -UI"0 S 1971 939P694 205m883 63.22' 269,til 1971 733#811 117P900 52s671 170572 1972 615s911 960547 44*510 141&056 1973 519A364 127*806 38.162 16S*969 1974 391L 57 143s685 p4.598 168,83 1975 247PA72 97.841 14o844 112#685 1976 150s031 24#639 Si97 3510036 1977 125.392 19-569 9P384 28.953 1978 105#823 9#204 7s812 t17v6 t979 960619 22,208 6P293 28.501 1980 74411 170860 4v556 2 A 1981 56P551 10551 3.837 56389 1982 55000 25POO 3D094 28,094 1983 30*n00 10.000 1891 11R891 1984 20P000 10A000 1203 li#203 REVISD Table 4.2: MEXICO - ESTIMATED FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT OTISTANDING INCLUDING UNDISBURSED AS OF DECEMBER 31, 1969 (CONT.) Debt Repayable in Foreign Currency (In thousands of TJ.S. dollars) Page h nEPT OTST (EGIN IF PFRInp) PAYMENTS nURING PERIO INCLUnING AmORTIm ¥EAR UNrISpURSED ZATION INTE9EST TOTAL PRVATELYHELO DERT PR?VATELY PLACEO PONDS 1970 t159619 2s661 8#217 10.%78 1971 112*958 16>712 79808 2a,5s0 1972 Q6,946 39671 5.874 45p5 5 1973 56>576 289862 39783 3,29&. 1974 ?7,714 5,517 2016 1975 2?-197 5>177 1*648 6>825 1976 17Pn20 4*649 1152 2 197? 12>171 4,663 818 .ae 1976 7,708 4.678 483 5816 1979 3>030 10737 a7. 1980 1>994 296 8 4 1981 998 314 60 *På 1982 A84 333 41 374 1983 351 351 21 37? LOANS FROM I=TERNATIONAL ORGANIZATIONS 197n 875,63 290760 35,182 64,942 1971 46,0i3 33,494 39,9157 1972 812p609 41,816 41,833 830650 49737 45A7<7 &i tAai5 7m 197t 725,076 46>424 39,739 86#164 1975 676:'L52 49,350 37,694 87,045 1976 629,301 51>199 34,901 866001 a97 57 ,4 51 ,37 41p99ch83 4 a 1978 526 164 52,715 29,056 81,772 1980 418.392 55.053 22o905 77,958 1982 3n6p749 58>198 t6,520 74.718 u983 2&8 -51 541 i.3o245 71465 1 984 19n*630 540015 9,9999 64,t14 REVISED Table . 2: MEXICO - ESTIMATED FTUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT C,UTwneSTTAT TINWTTTVr. TNTSURSFD AS OF DECEMBER 31, 1969 (CONT.) Debt Repayable in Foreign Currency (Tn thnnands of U.S. dollars) Page 5 DEFT GOTST (BEGIN nF PERInD) PAYMENTS nURING PERInD INCLUDING AMORTI. YEAR UNDISSURSEO ZATION INTEREST TOTAL LOANS FROM INTERNATIONAL ORGANIZATIONS IBRD 1970 655,115 22#525 29#164 51,689 1971 632,790 23,81! 31'319 55.130 1972 606,979 29,839 32#306 62,145 1973 579.¶40 s 32,2O'126a4 n27 1974 547?125 33,437 31.000 649437 1975 513,488 36,343 ~9,66 6q,@89 1976 477#325 38.212 279504 65,714 19779 1978 400,163 39,728 23,002 62,73, 1979 360,4a35 42>101 20.649 62,750 1980 318,334 42#097 189191 60p88 G98 t7o>?&1^237 åtmo9 et5 0469 98.te% 1982 232,322 46,409 13.113 59*522 1982 32.531 A.7 1 437 5 7 1984 139,sA6 440360 7,762 52*122 1970 2?0p548 7#235 6,018 13#253 r9 2138 963 8596 18,279 1972 203,630 110977 9,527 219504 17'3 191p653 0#7o2 9#441 23,143 1974 177»Q5I 12p987 8,739 21#727 1975 164p964 i2,987 8,068 21,056 1976 1510976 12p987 7f397 20384 i977 138,QF9 12#987 6#726 19s713 1978 126»001 12,987 60055 19,42 1979 113fi14 12,956 5,384 18,340 1980 1or0,058 12,956 4,714 170670 1981 87,01 12#675 4,044 16s719 1982 74#427 11,789 30407 15,196 1983 62-438 11*594 2,808 14#402 1984 51#)a4 9>655 2#237 11,891 REVISED Table h. 2: MEMICO - ESTIMATED FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSED AS OF DECEMBER 31, 1969 (CONT.) Debt Repayable in Foreign Currency (In thousands of U.S. dollars) Page 6 DE2T T;TST a nA Wh 9k m-em. m .. .-ma . tUNi n-Pr_D10U) PATMLNTS nURING PERO INCLUDTNG AtORTI* YERN uliSRUWS ZATION !NTEREST TOTAL L **AS a sva V VMENJTh'T 197(1 6810100 83P460 31P256 1"! 597#740 80919 30tS62 111.481 i92 516.v11 75s809 76003o 20oqse 193 441*n13 72858 220218 95* D7r t974 368Pj55 64,564 82.8 A A Ivr% 303.591 60,080 14s378 74,458 1976 243#Sit 44P351 1132 qR.AA* 977 1990160 39.300 8,667 47s9 1978 159'861 36.6P7 &%PAA aa 979 173.044 30*613 4,494 350fo 1980 92s630 25.528 2P754 ?A's 1 1 1vol 67P103 11719 1,683 130402 1982 55.384 7#292 1#27 is A4 A 1963 46A191 6.155 998 ? 53 1984 41#936 5.325 At? A.I-, CANADA 1970 50.@70 13.145 2s595 15.740 1971 37,P24 8s320 2#014 Iig-13A 1972 29.04 8P736 1615 100352 1973 2r09748 7#429 is11ti hAe 1974 130340 3#778 718 4P495 1975 9.962 2P227 57 *014 1976 7,335 2,035 382 20417 1977 5,100 6R0 2A 93 1978 As650 650 246 896 1979 8,n0 AR 2A A5 1980 3j351 650 169 8Ip lost I AT0n AA it# w1A-s -OR -,p 6I 131 - '!f 1982 2>n51 650 93 749 984 72 290 47 Aa 1984tai72 229 47. f Table )2. MEYTCO - ESTTMÅT. FTTUP RVIUT PAYMENTS OM EYTERMAT PTTT DUT OiTSTANDING INCLUDING UNDISBURSED AS OF DECEMBER 31, 1969 (CONT.) Debt Repayable in Foreign Currency (In thousands of U.S. dollars) PaCge DERT 0DUTST (BEGIN nF PERInD) PAYMENTS nURING PERIOD INCLUDTNG AMORTIm YEAR UNDIRRURSEn ZATInN INvERST TOTAL LOANS FROM GOVERNMENTS KRANCE 1970 182p511 239881 9,958 33,839 1-1 13 v V. a - 14 493 v 1972 134#225 21p299 8,466 29#765 1973 ¶12-926 18a42 7a101 25,843 1974 01#¶84 170175 50869 2ý0044 å0' c -PI ^^ 11,JU £ _ ~ 197 7 rtt%27 9 16 GP o013 4,723 2tor526 1976 6n,206 11,815 39673 159488 1977 439mm 28?4a00 1978 36,576 119806 2,096 139902 97 2" r77 1190 1739 13p099 1980 12980 79870 521 8#39t 1981 5pli0 1s255 092 1982 3>855 i255 142 1396 i983 P>600 19255 91 to346 1984 to345 1i255 41 1,296 GE RMA-NY 1970 23s416 2,875 735 39610 1971 20s540 29498 686 3,i84 1972 18,942 2,649 806 3,455 1973 15p393 2,597 909 30505 1974 1?»796 2*569 750 3>018 1975 10,228 2p569 592 30161 1976 7,659 2,569 434 3#003 1977 5,*91 1,429 294 10723 1978 3#662 1,429 205 1633 1979 2>P33 1,429 115 1,544 1980 804 804 32 836 REVISED Table h.2: mEXICO - ESTIMATED FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT ~- ITSTANMr. TMTINT.N TNITTRSRV AS OF DECfMBER 31 1969 (CONT.) Debt Repayabie in Foreign rurrency (In thousands of I.S. doIarm) Page 8 DERT OOTST BrGIN nF PERIO) PAYMENTS nURING PEReOD INCLUDING AMORTt- YEAR UNDISPURSED ZATION INTIEREST TTA LOANS FROM GOvERNMENTS ITALY 1970 37DQ49 8*161 1,693 90854 1971 29.788 3>574 1691 59265 1972 269714 3#574 lp48 3 59n57 1973 22,639 3o574 1#274 4#849 1974 19,65 3>574 9,066 4*441 1975 15,490 3p525 859 49304 1976 11,965 3#284 654 3o938 1977 8,6A1 3>043 470 3'513 1978 5,636 1s790 305 2,095 1979 3o8&8 1p388 210 1,598 1980 2,460 1,388 127 1,514 1981 1,073 933 44 977 1982 140 140 4 144 JAPAN 1970 9,999 1971 9,999 909 660 1569 1972 9. o9 n *no G^" 150Y 1973 AffitAl 909 537 1974 7, 22 99 476 1 385 1975 6s363 9n9 414 1.323 1976 5,454 99 353 t9326 1977 4,545 909 291 1,200 1978 3636 99 230 i39 1979 2,727 9n9 169 1980 1rij 107 016 1981 909 909 46 955 REVISED Table 4.2: MEXICO - ESTIMATED FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT OLTSTANDTNjr TNCLMrI TTTTIZT r AQ oF DEMBER 31 19 69 (mMTNT. De-It Repayabl e -1n Fore-ign- rurrency (Tn thousands of I.S. dollara Page 9 PAYMENTS DURING PERIOD YEAR (BGIN OF PERIOD) AMORTI- INTEREST ToTAL ZATION UNDISBURSED LOANS FROM GOVERNMETS VÅ4-LIDUF sJ.ftL. .1970 37635 359?2,971 15,924 51,352A. f 1971 3ho,959 4l,212 15,561 56,774 19-72 29 ,7 7 38,6L1 -13, 12 -12,fn ^f3 1973 261,105 39,607 11,286 5o,89h 197 221,h99 36,559 9,206 4,765 1975 184,940 34,047 7,273 41,320 i n-: 1r^ ansn nn -n £ nn 3. 1977 127,153 21,455 4,442 25,897 1978 15,698 20,033 3,383 23,it 1979 85,665 14,448 2,h84 16,931 198 71217 13,7 -,82 U57 1981 57,310 7,972 1,270 9,243 .1 no 1) l- S'f 1~ 0I -n - £ ^n£ 1983 4,090 4,672 8h5 5,517 1984 39,418 3,841 726 1569 DNITED STATES 1970 30,681 1,5c9 747 2*754 1971 29,¶72 1,523 740 2.263 1972 27>650 1,537 698 28235 1973 26>¶¶2 1p552 655 a.o t974 24.560 1i568 612 2p180 .975 22.992 1584 569 2a-53 1976 21,408 1,600 525 20925 c077 194808 In61 44f 098 1978 1.8,191 1,621 436 29057 1979 "p7 1.2 9a1 2L 1980 14,944 1,644 346 19990 Ull¶7 -7ry .7 vv -0 1982 11p636 1,653 254 11906 1984 8,341 1,084 167 If251 REVISED Table 4. 2: MEXICO - ESTIMATED FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSED AS OF DECRMER 31, 1969 IOr. Debt Repayable in Foreign Currency (In thousands of U.S. dollars) Page 10 OEAT OUTST CBFnIk nF PFRIOD) PAYMENTS nURING PERIOU INCLUDING AMORT?- YEAR UNDISFURSED ZATION INTEREST TOYAL UNITED STATES AID. EXIMBANK. OTHERS 1970 345675 33#888 15047 48935 1971 311.787 39.689 14s741 54#431 1972 272,97 37#1o4 2.714 49o.41 1973 234.993 38,055 0.631 41s#86 1974 1960939 34,991 8#59,4 41s 1975 161.94,8 32*463 -.704 39.167 1976 129,P4-84 22#139 5,111 27,250 1977 107- 345 190838 3#961 23*799 1.978 A7.50-7 18.412 2#947 210360 1979 A9so95 12#822 2v093 14#91-4 1980 56273 12.9243 t482 t-A4% '1981 .44011 6,309 970 7.028 1982 -37#701 3#595 735 4.A3n 1983 34106 3*029 637 3s666 1984 31s077 20757 561 18 N AT N AL I ZATI ON 1970 93PA93 40906 t*472 6s378 ? . 13' So15 532M 0971 a878 4f1 ltSJ3 b 1972 1 4612 4v 175 882 59-057 1973 t1)43? 44175 611 4#785 1974 A072A 4#1,75 339 As114 1975 2, 87 2.087 !68 2 t15 Economics Department T,sl-r P 107n Table 4.3: EXICO - PAST TRANSACTIONS ON EXTERNAL PUBLIC DEBT, 1965-19691/ Debt Repayable in Foreign Currency (In thousands of U.S. dollars) Page 1 of 3 Debt Outstanding Beginning of Period Transactions During Period Including Disbursed Undis- Author- Amorti- Payments Year Undisbursed Only bursed ization zation Interest Total Grand Total 1965 2,088,843 1,735,624 353,219 h7,h42 396,471 88,312 048,783 1966 2,169,144 1,725,172 Ub3,972 541,913 365,014 91,460 L56,147 1967 2,3L6,105 1,8b8,886 L97,519 723,523 357,73h 113,170 470,904 1968 2,710,308 2,183,563 526,745 967,787 479,222 144,080 623,302 1969 3,198,083 2,475,721 722,362 802,16 462,382 151,133 613,515 1970 3,511,346 2,963,86 517,861 Total Privately Held Debt 1965 1,110,433 1,0h7,715 62,718 258,33h 325,229 55,511 380,740 1966 1,0l5,868 998,195 47,673 322,72h 285,660 55,997 3L1,657 1967 1,083,301 1,008,882 74,h19 36,18 255,506 67,052 322,558 1968 1,262,316 1,186,991 75,325 627,321 329,315 89,032 1418,37 1969 1.559455h 1.379.320 180.23b 661.597 350,5b9 92,960 L43,509 1970 1,882,096 1,740,163 11,933 Publicly-Issued Bonds 1965 112,768 112,768 - 27,500 3,h1 6,315 9,756 1966 137,175 137,175 - 45.000 10,525 7,950 18.175 1967 172,016 172,016 - 65,151 13,082 11,662 2h,741 1968 223.903 223,903 - 61.719 13,9L2 15.022 28,96h 1969 271,016 271,016 - 4L,974 11,506 17,191 28,697 1970 309097 309.9L7 Suppliers 1965 296.182 251.562 Lh.62o 1.782 67.100 12.7L8 79,88 1966 280,88 256,106 2h,742 99,b60 73,3h9 13,642 86,991 1967 306.962 256.919 50.00 107.871 7I, - h9 i.6 o 90.179 1968 339,725 292,881 46,841 160,110 85,977 18,152 104,L29 1969 413.775 31l1.80 102.295 172.92q 96.09 20o-8L6 116.9Lo 1970 491,005 429,493 61,512 Financial Institutions 1965 687,104 669,006 18,098 179,052 253,513 35,640 289,153 1966 6Th.6110 491.709 22,911 178-260 nn 2 , 33630 2314,814 1967 592,050 567,674 24,376 243,39L 166,826 39,050 205,876 1958 007JAI PMA2 28,191 34n,Qg 92 2A 28, 95,n An 8A 1969 779,780 701,841 77,939 h21,8h0 2h0,333 48,712 289,045 1970 Qo 2 AA5, iN An ,1 See footnote at end of table. abDle R M-AYTCO - PAST TRANSACTIONS ON EXTERNAL PUBLIC DEBT, 196-9691/ Page 2 of 3 Dh+ nq+c+ndin Rnginning of Period Transactions During Period Tncludin Dhsbred TTndi" AT+h Amor+irm-n+ Year Undisbursed Only bursed ization zation Interest Total Privately-Placed Bonds 1965 14,379 14,379 - - 1,175 808 1,983 1966 132 3,0 Co 2 775 1,707 1967 12,273 12,273 - 20,000 1,09 710 1,759 1631,22 31 225 000 1,2l I t1C 1969 9,983 94,983 - 21,858 2,616 6,211 8,827 TotLal Loans f rum ±±binernatinal Ora izatio 1965 )449,916 318,961 130,955 167,024 18,91 1702 5,3 1966 598,019 341,972 256,047 72,157 21,728 19,771 1,99 1967 uq"48,4 417,138 231,311 28,810 27,10 22,338 h9,hhU6 1968 650,155 475,272 174,883 207,797 30,427 26,321 56,748 1969 v27,51u 53u,1u 297,4uu 97,,u7 35,23u 2u,3u u3,54u 1970 889,377 619,367 270,010 IBRD 1965 377,266 299,755 77,511 167,000 18,289 15,603 33,892 1967 524,432 382,887 lh1,545 126 21,72 18,722 40,h6h 1968 502,564 WAS~LJJ 76,150 1LL,780 25,312 225,62h 07,93/ 1969 619,032 463,091 155,941 65,000 28,716 23,115 51,831 1970 655,315 505,985 109,330 iDB 1965 72,650 19,206 53,4h4 4 630 1,417 L(4 1966 72,061 24,124 47,920 53,233 1,260 1,901 3,161 1967 124,017 34,251 89,766 28,936 5,366 3,616 0,982 1968 147,591 h8,858 98,733 66,017 5,115 3,697 8,812 1969 208,h86 67,027 11,59 32,097 6,522 5,195 11,717 1970 234,062 113,382 120,680 Total Loans from Governments 1965 478,756 319,210 159,546 49,084 46,514 12,758 59,272 1966 481,328 341,076 lh0,252 107,032 51,963 12,927 64,890 1967 576,389 38h,600 191,789 208,795 70,229 19,431 89,660 1968 714,962 438,425 276,537 132,669 65,161 25,733 90,894 1969 782,456 537,728 2)4,728 43,452 71,733 28,075 99,808 1970 716,180 580,263 135,918 See footnote at the the end of table Table L. 3: MEXICO - PAST TRANSACTIONS 013 EXTERAL PUBLIC DEBT. 1965-19691/ Page 3 of 3 Debt Outstanding Beginning of Period Transactions During Period Year including Disbursed Undis- Author- Aorti- Payments Undisbursed Only bursed ization zation Interest Total Total Nationalization 1965 h9,738 49,738 - - 5,809 3,023 8,832 1966 3,929 h3,929 - - 5,663 2,765 8,428 1967 38,266 38,266 - L9,500 L,891 6,369 9,240 1968 82,875 82,875 - - 5)h,319 2,99 57,313 1969 28,555 28,555 - - h,862 1,788 6,650 1970 23,693 23,693 - >U"U W w C1 ,a4U1cL e e vies ivisin U1 mesUa-ULU UVe]armn )ource: LiuRD Statistical Services Division, Economics Departnent. Table 4.4: DEBT SERVICE RA~TIO, 1.6o-1970 (Million US$ and percent) Amorti- Year Exports Interest zation Service Ratio 1960 1,330 44 172 216 16.2 1961 1,424 51 166 217 15.2 1962 1,552 70 243 313 20.2 1963 1,675 72 208 280 16.7 1964 1,808 72 364 436 24.1 1965 1,972 88 396 484 24.5 1966 2,143 91 365 456 21.3 1967 2,152 113 357 470 21.8 1968 2,453 144 479 623 25.4 1969 2,714 151 462 613 22.6 1970 2,846 185 485 670 23.5 Source: Exports - Table 3.5; Interest and amortization - up to 1964, Banco de Mexico; 1964-1969 IBRD Statistical Services; 1970 Mission estimate. Data not comparable with Table 3.1 as that table uses public sector accounts for amortization. Dif- ferences arise in definition of term of debts, and in defini- tion of Public Sector. Table h.5: STRUCTUJRE 0: mYJ10' EXTERIAL 20'ROLlG (One year maturity and over) 1/ Interest Rate During 1968 During 1969 During 196ý8 During 1969 (thousand (thousand (percent) (percnt us$) us$) o to 3% 55,h95 1,525 5.7 0.2 over 3 to 5% 13,502 817 1.h 0.1 over 5 to 7% 588,510 317,657 60.b 39.1 over 7 to 9% 307,253 362,201 31.5 44.5 over 9% -- 130,760 -- 16.1 Total 97h,760 812,963 100.0 100.0 1/ Debt repayable in foreign currency. Data compiled. from debts whose terms are known to IBRD, and thus are not comparable to Table 3.1 (,Balance of Payments) or Table 5.1 (Public Sector Finances). Source: IBRD. Table 4.6: STRUCTURE OF MEXICO' S ETERNMAL PUBLIC DEBT OUTSTANDING (One year maturity and over) 1/ Interest Rate End of 1967 End of 1968 End of 1969 End of 1967 End of 1969 - -o (thousand Thousand hunpercentT percent7 us$) us$) us$) ( to 3% 90,851 136,073 128,,764 3.4 3.7 over 3 to 5% 204,841 194,160 154,196 7.6 I.4 over 5 to 7% 2,125,239 2,370,7011 2,364,099 78.7 67.5 over 7 to 9% 279,229 187,880 729,013 10.3 20.8 over 9% -- -- 127,717 -- 3.6 Totnl Outstanding 2,700,160 3,189,1L17 3,503,789 100.0 100.0 1/ Debt repayable in foreign currency. Data compiled from debts whose terms are known to IBRD, and thus are not comparable to Table 3.1 (Balance of Payments) or Table 5.1 (Public Sector Finances). Source: IBRD. Table 5.3: PUBLIC SECIXR RESOURCES FOR INVESTMENT, 1960-1970 (Million pesos) - 19 19 ~6 1962 1963 19 161966 17 9699 17 / I. SOURCES A. Current Account SurpLus 2. 62 7 769 72515 8,140 955j9 1018h5 1oL243 11,199 12,091 13,617 1,941 1. Federal Government 3,253 2,037 2,153 2,806 3,592 h,329 3,269 3,955 5,089 5,845 6,830 2. Federal District 819 916 1,026 1,035 1,167 1,178 1,303 1,367 1,561 1,633 1,663 3. Dece:ntraLized Agencies 3,623 4,186 4,366 4,299 L,500 5,338 5,671 5,877 5,41i 6,139 6,448 (a) Major Agencies/3 (3,123) (3,686) (3,866) (3,799) (4,000) (4,838) (4,971) (5,077) (4,641) (5,339) (5,6W8 (b) Other/3 (500) (500) (500) (500) (500) (500) (700) (800) (800) (Boo) (800) B. Capital Account Revenues 18. 27 36 42 48 218 891 67 659 205 201 C. Borrowing 561 5568 76L9 8,057 12,655 8,9 12j437 12,783 ¡16,827 19,183 20,ho4 1. Internal (Net) 1,700 1,548 3,109 3,278 4,833 h,651 5,819 3,900 7,438 8,433 9,00 2. External (Gross) 3,961 4,020 4,510 4,779 7,822 h,258 6,618 8,883 9,389 10,750 11,000 TOTAL RESOURCES 1374 12,764 15,222 16,23 21,962. 19972 23,571 24,0L9 29,577 33,005 3h,566 II. USES A. Gross Fixed Investment 8909 8 931 10,019 2,65 16,35 13637 lh339 168O 19,662 23,539 25,169 1. Federal Government 2,765 2,654 2,751 2,810 3,913 4,246 4,420 5,172 5,979 7,451 8,196 2. Federal District 478 1lå 702 772 1,263 961 1,313 1,848 2,706 4,120 4,000 3. Decentralized Agencies 5,666 5,863 6,596 8,463 11,259 8,430 8,606 9,260 10,977 11,968 12,973 (a) Major Agencies/3 (3,933) (4,784) (4,727) (5,956) (8,492) (5,907) (5,137) (6,372) (7,185) (7,968.(8,9732 (b) Other/3 (1,733) (1,079) (1,869) (2,507) (2,767) (2,523) (3,469) (2,888) (3,792) C,000) (4,00d) B. Amortization of External Debt 2,15 4 2,081_ 3_O_2 2 59h 3,798 425 530 5,261 6L4jIo 6 10_4 7,000 C. Financial bnvest,ment 2,311 1,752 219 602 1-,79 1,610 8928 1508 1,h75 3j362 377 1. Federal Governent 715 515 447 500 1,088 2,477 1,749 3,021 2,795 1,755 1,500 2. Other 1,596 1,237 1,672 1,100 6>41 -867 2,179 1,487 680 1,607 1,877 il Preliminary. /2. Estimate. /3 Pemex, Power, Social Security, Toll Roads. Source: Secretarfa de Hacienda y Crédito Publico, Banco de México and OGrupo Hacienda-Banco de México. Table 5.2: PUBLIC SECTOR RESOURCES FOR INVESTMENT, 1960-1970 (Percent of GDP) i. SOURCES A. Current Account Suplus 5.1 4.4. 4.3 4.2 .3 3.7 .7 3.6 3 1.6 1. Federal Government 2.2 1.2 1.2 1.4 1.6, 1.7 1.2 1.' 1.5 1.6 1.7 2. Federal District 0.5 0.6 0.6 0.5 0.5 0.5 0.5 0.4 0.5 0.4 0.1 3. Decentralized Agencies 2. 2.6 2.5 2.2 1.9 2.1 2.0 1.9 1.6 1.6 1.6 (a) Reporting Agencies (2.1) (2.2) (2.2) (1.9) (1.7) (1.9) (1.8) (1.7) (1.4) (1..4) (1.14) (b) Other (0.3) (0.3) (0.1) (0.3) (0.2) (0.2) (0.3) (0.3) (0.2) (0.2) (0.2) B. Capital Account Revenues - - - - 0.1 0.3 - 0.2 0.1 - C. Borrowing 3.8 3. L .3 4.1 5.5 3.5 4.4 4.2 5.0 5.1 4.9 1. Internal (Net) 1.1 0.9 1.8 1.7 2.1 1.8 2.1 1.3 2.2 2.3 2.3 2. Erternal (Gross) 2.6 2.5 ?.6 2.4 3.1t 1.7 2.4 2.9 2.8 2.9 2.7 TOTAL RESOURCES 8.9 7.8 8.7 8.3 9.5 7.9 8.4 7.9 8.7 8.1 8.14 II. USES A. Gross Fixed Investment 5.9 5.5 5.7 6.2 7.1 5.4 5.1 5.3 5.8 6.3 6.:1 1. Federal Governnent 1.8 1.6 1.6 1.4 1.7 1.7 1.6 1.7 1.8 2.0 2.0 2. Federal District 0.3 0.3 0.4 0.4 0.5 0.4 0.5 0.6 0.8 1.1 1.0 1. Decentralized Agencies 3.8 3.6 3.8 4.3 4.9 3.3 3.1 3.0 3.2 3.2 3.:l (a) Reporting Agencies (2.6) (2.9) (2.7) (3.0) (3.7) (2.3) (1.8) (2.1) (2.1) (2.1) (2.2) (b) Other (1.2) (0.7) (1.1) (1.3) (1.2) (1.0) (1.2) (0.9) (1.1) (1.1) (1.0y B. Amortization of Erternal Debt 1.14 1.3 1.7 1.3 1.6 1.9 1.9 1.7 1.9 1.6 1.7 C. Financial Investment 1.5 1.1 1.2 0.8 0.7 o.6 1.4 0.8 1.0 0.9 0. 8 1. Federal Government 0.5 0.3 0.3 0.2 0.5 1.0 0.6 0.R 0.8 0.5 0._ 2. Other 1.1 0.8 1.0 0.6 0.3 -0.3 0.8 0.5 0.2 0.4 0. 4 Source: Secretarfa de Hacienda y Crådito Publico, Banco de Mexico and Grupo Hacienda-Banco de M4xico. Table 5.3: FEDERAL GOVERNMENT FINANCES, 1960-1970 (Million pesos) 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969L. 1970/. i. Current Revenues/3 10 970 1L 392 12,7 6 537 17229 19 876 20 864 22,676 26,689 30,232 3,165 1. Tax Revenue 1 6 10,1 11,797 13, 16T',209 Y1,117 i1 2 20,38U 23,932 27,2 30,8 2. Non-Tax Revenue 905 891 999 1,086 1,040 1,759 2,002 2,292 2,757 3,027 3,260 II. Current Expenditures 7 717 9 355 10 6h3 11,731 13,657 15 5h7 17 595 18,721 21,600 2h 387 27,315 1. Administraive pe nditures 73 51 . ~ . 7 ~6,323 7,6 7,~ , 9 10,25 1 - a. Wages and Salaries (3,945) (4,391) (4,800) (5,392) (5,943) (6,681) (6,995) (8,225) (9,034) (10,624) - b. Purchase of Goods (392) (399) (413) (431) (470) (415) (436) (547) (664) (652) - c. General Services (416) (361) (434) (500) (656) (609) (1,340) (762) (1,027) (1,1415) - 2. Interest on Public Debt/4 507 703 708 686 1,127 1,839 2,485 2,741 3,337 3,820 - 3. Current Transfers/5 2, 361 3,397 4,158 4,552 5,273 5,81o 6,003 6,206 7,253 7,481 - h. Other Current Expenditures 96 10IL 130 - 170 188 193 236 250 285 395 - 5. Allowance for Contingencies - - - - - - - - III. Current Account S uis 323 05 2 806 3 592 _l329 3j269 3955 5 08.9 5 a45 6 83o IV. Capital Revenues 18 27 36 42 48 218 B91 67 65 9 20 - V. Capital Transfers 598 534 572 1 10 1127 1h7 2 581 21220 023_ - VI. Financial Investment 71$ 515 1 477 $00 1,088 2 77 17h9 1,021 2, 79 175_ - VII. Funds Available f or Fixed Investment by Federal Government (III+V-VI) 1,95B 1,01 i i- 714 2 1 863 964 1420 733 2 - VIII. Fixed Investment 2L76_ :2 654 8_1_0 3p913 ]26 _ 420 7.2 979 7h.51 - IX. Financin 2f Fixed Investment 27765 265 2 1 2 810 3 913 726 h20 172 ,?9 7 651 - 1. Funds Availab1e (LInII) ,95 .,015 1,175 0 ,2 1, 9 T9~ 17120 173 2,-27 - 2. Borrowing (Net) 806 1,639 1,581 1,565 2,464 3,383 3,456 4,752 5,2 46 5,189 - 71 Preliminary. /2 Estimated. /3 Not including Social Security, etc. /4 Domestic and Foreign. /5 Transfers to Social Security Institutions, Railroad, etc. Source: Secretaría de Hacienda y Crédito Piblico, Banco de México and Consultorfa. Table '5.h: CURRENT FINANCES OF THE FEDERAL GOVERNMENT, 1960-1970 (Percent) 19 116716 1969197 I. Current Revenues 100 100 103 100 100 100 100 10,0 100 100 100 1. Tax Revenue 92 92 92 93 94 91 90 90 90 90 90 2. Non-Tax Revenue 8 8 8 7 6 9 10 10 10 10 10 II. Current Exoenditure 100 103 10 100 100 100 100 100 100 100 100 1. Administrative Expenditures 6:2 55 53 54 52 50 50 51 50 52 - a. Waes and Salaries (51) (47) (45) (46) (hh) (,3) (LO) (hh) (12) (44) - b. Purchase of Goods (5) (4) (h) (4) (3) (3) (2) (3) (3) (3) - c. General Services (5) (h) (4) (4) (5) (4) (8) (>) (5) (6) - 2. Interest on Public Debt 7 8 7 6 8 12 14 15 15 16 - 3. Current Transfers 31 36 39 39 39 37 34 33 3h 31 - L. Other Current Eroenditure 1 1 1 1 1 1 1 1 1 2 - 1 Figures may not add up due to rounding. Source: Serretarfa de Harienia v Cre'dito Pblico, Banco de Mexico and ConsultorCa. Table 5.5: CURRENT REVENUES OF FEDERAL GOVERNMENT, 1964-1970 (Million pesos) 1964 1965 1966 1967 1968 1969L' 1970-( I. Total Current Revenues 17,249 19,876 20,864 22,676 26,689 30,232 34,145 II. Tax Revenues 15,882 18,117 18,862 20084 23 932 27,205 30 885 a. On business income 3,895 4,970 4,910 5,833 6,984 7,972 9,218 U. U1 personal income ,uo ,>)( ,LU LJo 4,(u2 2,?7 u, IJ7 c. Income stamp taxes 301 283 2h 281 329 356 409 iunoiver Ia~ Iou QQU U 305U 0073) ,UJ L,( 3. Production and Con- sumption Taxes 2,211 2 , 25 2,o92 3, u 3,588 _ ,L7U 4. Import Taxes 2,411 2,651 2,412 2,630 2,902 3,324 3,444 5. Export raxes o0U 87 73 5o odo 26 o1 575 6. Other Tax Revenues/3 1,258 1,398 2,120 1,500 1,740 1,957 2,196 III. Non-Tax Revenues 1,367 1,759 2,002 2 292 2,757 3,027 3,260 1. Sale of Goods 0ly 773 Y0 1,029 1,126 1,230 2. Sale of Services 948 986 1,172 1,306 1,728 1,901 2,030 /1 Preliminary. /2 Estimation (based on 11% increase in GNP in current prices). /3 Includes surcharge for education, fines, stamp taxes and arrears. Source: Secretar'a de Hacienda y Credito 1%blico, Direccion de Estudios Hacendarios. Table 5.6: CURRENT ACCOUNT TRANSFERS OF THE FEDERAL GOVERNMENT, 1960-1969 (Millions of pesos) 1960 1961 1962 1963 196h 19651 1966- 1967L 19681 19691 TO TAL 2, 36:1 '97 4,158 4,552 5,273 5,8L0 622 6206 7,2_53 7,481 1. Railroads 380 526 573 623 806 733 1 079 990 903 1,166 a. Nacionales 2ž3 312 299 ' h_ž7 ~ 77 997 b. PacifTico 93 169 137 119 170 187 201 216 170 291 c. Others 62 45 137 69 1ch 59 61 63 36 158 2. Social Security 683 862 1,206 1,319 1,506 ,1ii 1,837 1,993 2,114 L1822 a. IMSS 32 9 662 706 1,cI ~~2 730 789 0 b. ISSSTE 113 211 354 400 472 525 658 721 774 1,02 c. Pensions 198 219 303 25 2L8 566 610 542 598 n.d. 3. Education 219 280 414 444 594 656 720 882 i 036 696 a. National University 129 12If 7ý6 757 279 00 10l 3 :>2 b. Other Universities 35 55 h5 59 111 105 130 162 223 90 c. Other Education 35 97 213 167 20 251 221 316 '330 lo4 4. Public Health and Welfare 437 499 498 345 468 654 h99 529 687 n.d. 5. Agriculture 80 hol 828 847 829 1,s05 1,445 1385 1,539 1,580 a. Conasupo - VC l!;)iO 1,0 1,00 1,00 1,000 1,000 b. Banco Ejidal 50 105 399 417 298 375 415 350 26 559 c. Banco AgrEcola 30 30 29 30 31 30 30 35 45 21 d. Others - - - - - - - n.d. 229 n.d. 6. Subsidies to Local Government 36 46 50 73 101 89 101 :L14 67 n.d. 7. Other (Unclassified) 36 783 589 9ol 969 :8 321 313 907 193l /1 Mission estimates, actual figures not available. Source: Secretaría de Hacienda y Crédito Pblico and mission estimate. Tatle 5.7: CURREiT ACCOUN FINANCES OF SFLZTED TECEN1TRALI2E KGENCIES, 1960-1970 (Million pesos) 1960 1961 1962 1963 196v 1965 3966 1967 1968 1969'1 197cd Decentralized Ageniciaes/ T-, Current Revenues 9,35 11?8.. 9312,678 1h,329 16,i33 18,307 20,553 22,328 24,575 27,054 30,030 2. Current Expenditures 6,292 7592 8 812 10,510 12 333 13 169 15 582 17 251 19 934 21 715 214 382 3. Current Account Surplus 3,123 3 3,799 0 f, ,7 5,07 ,5,339 , A. Petroleos Mexicano. 1. Current Revenues 5,7914 6,479 6,731 7,259 7,971 8,1b60 9,173 10,078 '11,045 11,973 12,979 2. Current aRpenditures 3,766 j50 j4,1l5 14 971 $ 383 5 617 6989 _725 ý687 8£898 10,156 3. Current Account Surplus 2,026 2,329 2,31E 2 §t,3 3,Ct 2,82 2,35 5 ,7 2,83 B. Power Sector /4 1. Current Revenues 1,3142 1,931 2,h75 2,860 3,340 3,916 4,L23 4,541- 4,8974 5,296/ 5,957 2. Current Expenditures 1 075 j718 2 032 2_590 2949 2904 3 738 3 557 L773 14,32 t,6L0 3. Current Account Surplus 213 270 391 1,012 tB 98. 1,12M 99G 1,317 c. Social &curity a~ Ws=-. Current Ravenues 1,763 2,154 2,569 3,126 3,674 4,350 5,081 5,753 6,452 7,323 8,312 2. Current Expenditures 1 282 L532 1 910 2,3h8 3 236 3979 4 L53 5878 1 6 444 7,315 3. Current Account Surplus T81 6 77t % 371 2 F5 791 t 79 997 b. ISSSTE-1. Current Revenues 469 758 802 959 1,207 1,1405 1,675 1,708 1,863 2,077 2,316 2. Current bpenditures 163 282 418 569 687 659 j1 55 1,370 l547 1.724 1 922 3. Current Account Surplus 36 US79 33 7 9720 338 316 33 t94 D. Toll Road Authority 1. Current Renues 47 56 101 125 141 176 201 2148 318 385 466 2. Current E&penditures 6 10 37 52 78 110 147 192 266 307 349 3. Current Account Surplus l3 ~flh 73 7S - --m1 E. Railroads I. Current Revenues 1,819 1,754 1,757 1,90 2,116 2,257 2,345 2,4i0 2,487 2,609 2,738 2. Current E&penditures 1,911 5107 2 219 2 b53 2,6B4 2 800 2,958 3,132 3j293 3L55 3 734 3. Current Account Surplus -99 3 t6 %W 6 t-3 -6M3 -722 -67 - -996 F. Conift.e 17 Current Revenues - - - - - - 2,299 3,288 2,656 3,009 3,090 2. Current Erpenditures - - - - - - 239 14235 L570 h781 3.569 3. Current Account Surplus - - - - 9 97 9 79 /1 Preliminary (gruno Secretar'a de Hacienda-Banco de Mexico). 72 Estimate ( " "" ) 75 Includes only A to D. 7 Includer only two enterorises: C.P.K. and Cla. de Luz y Fuerza del Centro. The Cfa. Nueva de Chapala e I.E.M. was merged with C.F.E. in 1968. Source Direccion General de Pgresos, Secretarfa du Halciendo y Crédito Pdblico. Table 5.8: CURRENT ACCOUNT REVENUES AND EXPENDIT[JRES OF THE FEDERAL DISTRICT, 1960-1970 (Million pesos) 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969L- 19701 I. Current Account.Income 151370o 1p2 1,708 >51 2378 1. Taxes 829 1,000 1,075 1,179 1,340 1,659 1,630 1,800 2,082 - - 2. Shared Taxes and Mis- cella.neous Charges 151 173 192 205 265 246 273 ) 3. Taxes, due from pre- ) h95 579 - - vious years, etc. 92 122 152 17h 199 205 210 ) 4. Sale of Goods and Services 172 179 210 192 248 234 314 298 370 - - 5. Other 56 88 79 101 96 89 128 163 171 - - II. Current Account Expenditure_s 50 616 682 816 960 o,i _) 252 389 641 ,86,7 1. Personal Services 328 348 382 478 541 598 635 817 902 - - 2. Purchase of Goods and Services 66 66 88 114 133 116 109 113 128 - - 3. General Expenditures 37 43 56 67 87 89 97 107 171 - 4. Transfers 14 20 30 47 57 60 64 90 101 - - 5. Others 105 140 125 109 141 191 347 262 339 - - 6. Interest on Debt - i - III. Current Account. Surpus 319 91 6 035 1 6 8 /1 Estimate. Source : Consultorfa. Table 5.9: FIXED INVESTMENT OF DECENTRALIZED AGENCIES AND FEDERAL DISTRICT, 1960-1970 (Million pesos) 1960 1961 1962 1963 1964 1965 1966 1967 1968 19691 1970/1 TOTAL . 6 1i 4,29 10,6 73g gi 08 11, 83 13,688 1,573 A. Federal District 478 414 702 772 1263 961 113 1, 8I8 2,36 ].LO 4,o B. Reporting~encies 5l 4o 31 657.6 9.293 66,o6 7,060 8,777 9 568 o73 1. Pemex 2,537 2,314 1,935 1,871 2,558 2,106 2,868 4,210 4,221 5,]00 h,800 2. Comisin Federal de Electricidad ) 2,508 1,l66 1,242 1,690 - - 3. Nueva Cfa. Elictrica de Chapala ) 849 1,26L 1,960 2,987 3,197 24 23 - - - 4. Cfa. de Luz y Fuerza del Centro ) 215 166 369 395 - - 5. Industria Eléctrica Mexlcana ) 229 .126 - - - - 6. Instituto Mexicano del Seguro Social 3h7 817 521 79h 2,081 392 186 156 369 - - 7. ISSSTE 101 191 146 120 220 90 53 82 60 - - 8. FF. CC. Nacionales de México ) 396 437 368 1,160 - - 9. F.C. del Pacifico 1,o48 619 588 701 801 78 '141 54 90 - - 10. F.C. Chihuahua al Pacffico ) 66 790 h 4 - - 11. FF. CC. Unidos de Tucatån ) 16 12 2 1 - - 12. Caininos y Puentes Federales de Ingre so 99 198 145 184 436 343 569 313 450 - - 13. Aeronaves de México - - - - -37 80 211 335 - - 14. Loterfa Nacional - - - - - 9 9 2 - - /1 Estimation. Source: Secretarfa de Hacienda y Crédito Pýblico, Dirección de Egresos. Table 5.10: ANALYSIS OF PUBLIC SECTOR FINANCES 2960-1970 (Billions of oesos - current prices) 1960 1961 _ 1962 1963 1964 1965 1966 1967 196 1969 1970 Federal Government Current Revenues 11.0 11.4 12.8 14.5 17.2 19.9 20.9 22.7 26.7 30.2 1h.1 Current Expenditures 7.7 9.4 10.6 11.7 13.7 15.5 17.6 18.7 21.6 24.4 27.3 Current Account Surplus 3.3 2.0 2.2 2.8 3.6 4.3 3.3 4.0 5.1 5.8 6.8 Averaze S ns Rate 0.30 0.18 0.17 0.19 0.21 0.22 0.158 0.176 0.191 0.192 0.199 Savings as Fraction of Investment 1.18 0.77 0.78 1.00 0.92 1.02 0.74 0.76 0.85 0.78 0.81 Federal District/I Current Revenues 1.4 1.6 1.7 1.9 2.1 2.2 2.6 2.8 1.2 i.5 1.8 Current .en.diturs.. 0.A 0.6 0.7 0.8 1.0 1.1 1.3 1.4 1.6 1.9 2.1 Current Account Surplus 0.8 0.9 1.0 1.0 1.2 1.2 1.3 1.4 1.6 1.6 1.7 Average Savings Rate 0.60 0.61 0.60 0.56 0.55 0.51 0.500 0.500 0.500 0.L57 0.l67 Investment 1.71 2.29 1.47 1.34 0.92 1.22 0.99 0.74 0.58 o.6o 0.42 (Major)/? Current Revenues 9.4 11.4 12.7 14.7 14.3 18.3 20.6 22.3 24.6 27.1 30.0 Current Ex, res 6.3 7.7 8.8 10.5 12.3 1I4C i.6 17.1 19.9 21.7 214.1 1ure t r.x.7 1.9 1.8 -.; 5. 4 . *. Current Account SurDlus 3.1 3*7 3.9 3.8 4.0 4.8 .0 5.1 5.6 5.3 5.6 Average Savings Rate 0.33 0.12 0.10 0.27 0.24 0.26 0.243 0.229 0.187 0.197 0.188 Savins Rate- C.F.E. 0.1 n 0.10 0.1790 o.94 0.117 0.258 0.155 0.217 Oz2lO r180 0.)2 Savings Rate: Pemex 0.50 0.36o o.144 0.315 0.325 0.336 0.36 0.280 0.21 0.257 o.219 Savings as Fraction of investment: 0.7914 0.770 0.1 0.638 0.1-71 0.819 0.968 .797 0.h 0.682 C.F.E. 0.3114 0.j69 0.226 0.090 0.122 0.3140 0.1469 0.611 o.519 -- Pemex 0.799 1.006 1.197 1.223 1.012 1.350 1.075 0.671 0.559 0.601 o.k88 Surolus of Other Agencies 0.5 0.5 0.5 0.5 0.5 0.5 0.7 0.8 0.8 0.8 0.8 Ttal Public Sector Surplus 7.7 7.1 7.6 8.1 9.3 10.8 10.3 11.1 12.1 11.6 I.o Revenues/3 21.8 24114 27.2 31.1 v3.6 40.2 14 47.8 5L-5 60.8 B Average Savings Rate 0.353 0.291 0.279 0.260 0.277 0.269 0.23h 0.236 0.222 0.224 0.2) Caoital Revenues - - - - - 0.2 0.8 0.1 0.7 0.2 0.1 unds Available Belore Borrowing 7.7 7.1 7.6 8.1 9.3 11.1 11.1 31.3 12.8 11.8 15.1 Total Investment 11.2 10.7 12.1 13.6 18.1 15.2 18.2 18.8 23.1 26.9 28.6 Funds as % of Total Investment 0.688 0.664 0.628 0.596 0.514 0.730 0.610 0.6cl 0.55 0.513 0.)28 Financial investment 2.3 1.8 2.1 1.6 1. . L .9 2.5 >. . ? Funds Available for Fixed Investment 5.4 5.3 5.5 6.5 7.6 8.4 7.2 8.9 9.3 10.4 11.7 Fixed Investment o.y 8.9 10.0 12.0 1o.L 11e II -. 19.7 23.5 . Funds Available as I of Fixed Investment 0.607 0.596 0.550 0.542 0.463 0.6 0.503 0.5o46 U.7 0.007 0.06, Net Borrowing 3.5 3.5 L.6 5.5 8.9 L.2 7.1 7.5 10.A 13.1 11.h Gross Erternal 4.0 4.0 4.5 4.8 7.8 4.3 6.6 8.9 9.4 10.8 11.0 Amortizati3n 2.2 2.1 3.0 2.6 3.8 h.7 5.3 5.3 6.4 6.1 7.0 Net External 1.8 1.9 1.5 2.2 4.0 -0.4 1.1 3.6 1.0 L.7 L.0 Net Internal 1.7 1.5 1.1 1.1 4.8 4.7 5.8 1.9 7.14 8.4 -. Bank of Mexico - - - - - - - - 5.6 6.1 7.1 Other Domestic Banks - - - - - - - - 1.8 2.1 2.' Gross Domestic Investment 27.8 28.9 29.8 13.6 414.0 45.7 52.5 60.o 67.0 76.0 - 3ross Domestic Savings 25.9 28.3 10.4 34.0 42.6 45.1 51.0 58.1 64.6 74.4 - Ga. 1.9 0.6 -0.6 -0.4 1.4 0.6 -0.5 1.9 2.6 1.6 - Factor Income Payments 2.0 2.2 2.6 3.0 3.7 4.1 4.8 5.7 6.8 7.2 - Balance in Current Account 3.9 2.8 2.0 2.6 5.1 4.7 4.3 7.6 9.2 8.8 - Net Public Inflow 1.8 1.9 1.5 2.2 4.0 -0.14 1.1 3.6 2.9 1.6 - Net Private Inflow 2.1 0.9 0.5 0.4 1.1 5.1 3.0 4.o 6.1 b.2 - Note: Certain figures may not add up due to rounding. /1 Includ*s Metro 1968-1970. 72 Pemex, oower Sector, Social Securities, Toll Roads. 7P1 Fdoel Governen+, T.F. and manor neancies only, Table 5.11: PUBLIC INVESTMENT PROGRAM, 1960-1970 (In millions of pesos, current values)- 1960/2 19617 1962" 1963$ 1961L 19652 1966 -167 11969 TOTAL 8,376 10,372 10,823 13,821 17,436 13,049 15,475 21,057 23,314 26,339 30,250 Agriculture Sector 675 959 858 1,421 2,369 1,124 1,267 2,405 2,1161 2,897 4,000 Agriculture 577 943 8:13 1,412 2,167 1,106 1,255 2,349 2,131 2,661 - Livestock 2 2 1 2 2 4 4 4 17 41 - Forestry 1 8 4 1 14 3 4 12 20 - Fishery - - - - - 10 5 48 .185 175 - Other Investients 95 6 4o 6 198 - - - 116 -- Industrial Sector 2,610 4,601 4,198 4,580 5,322 5,779 7,719 8,520 8,749 9,593 11,250 Electric Power 1,455 2,518 2,291 1,76o 1,852 1,415 2,395 2,499 2,836 3,029 4,1h7 Petroleumi and Gas 1,046 1,805 1,594 2,001 2,729 2,478 3,797 4,132 ) 5,nh 5,022 5,.UO Petrochemicaly - - - - - 979 826 978 ) Steel 35 96 130 248 251 506 317 182 212 892 700 Mining 12 20 4 178 o40 15 30 ) Other Investments 62 163 179 3914 449 387 369 700 ) $ Transport & Cormmnications Sector 3,014 2,801 3,119 3,397 3,668 3, 409 2,902 4,902 5,h61 5,841 6,500 Roads 827 1,101 1,093 1,655 1,928 1,767 1,966 2,170 2,219 2,778 2,609 Railroads 1,375 1,161 1,169 1,oo 1,308 1,192 692 1,353 1,376 1,605 1,921 Ports 165 125 172 125 128 76 134 190 199 346 378 Airports 108 92 176 272 120 374 110 655 813 713 650 Telecommunications 15 16 96 82 60 - - 322 717 100 565 Other Investments 523 306 413 263 125 - - 213 137 - 377 Social Sector 1,885 1,757 2,272 3,982 5,553 2,413 3,425 4,769 6,199 7,365 8,000 Municipal Services 748 860 1,017 1,598 1,907 1,318 1,866 2,280 3,604 4,587 - Hospitals 514 376 428 943 2,528 209 804 606 608 1,014 - Education and Research 192 273 175 438 610 774 589 1,021 1,136 1,1472 - Housing 431 238 653 1,003 507 95 142 793 650 258 - Other Investmiente - - - - 17 24 69 201 34 - Equipment and :nstallations for Administration and Defense 192 255 376 441 525 325 163 461 444 643 500 /1 Authorized investment. 72 Realized investment. 7 Programned investment. Source: Secretaría de la PresILdencia. Table 5.12: SECTORAL DISTRIBUTION OF THE PUBLIC INVESTMgNT PROGRAM, 1960-1970 (Percentage) 1960 1961 1962 F1963 196 196 ~1966 1967 1968 1969 1970 TOTAL 100.0 100.0 100.0 100.0 100.L0 100.0 100.0 100.0 100.0 100.0 100.0 Agricultural Sector 8.1 9.2 7.6 10.2 13.6 8.6 8.2 11.5 11.4 11.0 13.2 Agriculture 9.1 7. 10.2 12.1 01I 11.3 10.~ . - Livestock - - - - - - - - 0.1 0.1 - Forestry - 0.1 - . - - - - 0.1 0.1 - Fishery - - - - - 0.1 0.1 0.2 0.1 0.7 - Other Investments 1.2 - 0.1 - 1.1 - - - 0.2 - - Industrial Sector 31.1 44.3 39.0 33.2 30.5 h.3 49.9 40.9 37.7 36.4 37.2 Electric Power 17~4 2h. 3 21.2 1-27 10.6 1 I S M2.0 11.2 1 13. 7 Petroleum and Gas 12.5 17.14 14.7 14.15 15.7 19.0 24.5 19.8 18.9 ) 18.0 189 19.1 1. Petrochemicals - - - - - 7.5 5.3 4.7 3.5 ) Steel 0.4 1.0 1.2 1. 8 1.l 3.9 2.1 0.9 1.4 3.4 2.3 Mining 0.1 0.2 - 1.3 0.2 0.1 0.1 0.1 0.3 ) 2.5 3.2 Other Investments 0.7 1.h 1.9 2.8 2.6 3.0 2.4 3.4 2.h ) Transport and Communications Sector 36.0 27.0 28.9 24.6 21.1 26.1 18.8 22.5 23.0 22.2 21.5 Roads 9.9 10.6 10.1 12.0 11.1 13. 12.7 10.U -9.3 10.7 T6 Railroads 16.4 11.3 10.8 7.3 7.5 9.1 4.5 6.5 6.0 6.1 6.4 Ports 2.0 1.2 1.6 0.9 0.7 0.6 0.9 0.9 0.9 1.3 1.2 Airports 1.3 0.9 1.6 2.0 0.7 2.9 0.7 3.1 3.4 2.7 2.1 Telecommunications 0.2 0.1 0.1 0.6 0.4 - - 1.6 3.0 1.5 1.9 Other Investments 6.2 3.0 3.7 1.9 0.7 - - - 0.2 - 1.2 Social Sector 22.5 17.0 21.0 28.8 31.8 18.5 22.1 22.9 26.2 28.0 26. Municipal Services 7.9 83 9. I1 I75 10.15T 121 11.0~ T171 - Hospitals 6.1 3.6 4.0 6.8 14.5 1.6 5.2 2.9 3.5 3.8 - Education and Research 2.3 2.6 1.6 3.2 3.5 6.0 3.8 4.9 3.9 5.6 - Housing 5.1 2.4 5.8 7.2 2.9 0.7 0.9 3.8 2.4 1.0 - Other Investments - - - - - 0.1 0.1 0.3 1.5 0.1 - Equipment and Installations for Administration and D-fense 2.3 2.5 3.5 3.2 2.0 2.5 1.0 2.2 1.7 2.-4 1.7 Source: Secretarla de la Presidencia. Table 5.13: 1969 PUBLIC SECTOR INVESTMENT Value Percent of (million pesos) Total DeviaulUn Planned Actual Planned Actual (%) I. Industrial 11,350 ZLL2 41.3 36.4 -15.5 Petroleum and Petrochemicals 5,318 5,022 19.4 19.1 -5.6 Electricity 3.650 3,029 13.3 11.5 -17.0 Steel 892 892 3.2 3.4 - Other 1,490 650 0.2 2.4 -56.4 II. Social Sectors 6,550 7.365 23.8 27.9 +12.h Urban and Rural Works 4,124 4,587 15.0 17.4 +11.2, ZQeiClonI an1d ILReech l Lyj .Ly4 )*U ,e '). .o, Hospitals 842 1,014 3.1 3.8 +20.4 Housin- 2A 2A 10 1.0 -7.9 Other 249 34 0.9 0.1 -86.3 III. Transport and Communications 775 5,841 20.9 22.2 +1.1 Roads 2,265 2,778 8.2 10.6 +22.6 Railroads 1,701 1,605 6.2 6.1 -5.6 Airports 438 713 1.6 2.7 +62.8 Telecommunication 250 400 0.9 1.5 +60.0 Ports 2780 3460 1.0 1.31 +24.5? Other 843 - 3.0 - -100.0 IV. Agriculture 3,570 2,897 13.0 11.0 -18.9 Agriculture 3,064 2,660 11.2 10.1 -13.2 Livestock 50 41 0.2 0.1 -18.0 Forestry 18 20 0.1 0.1 +11.1 Fishing 215 175 0.7 0.7 -18.7 Other 223 - 0.8 - -100. . Oa. o oi 2re st. 0 Le-nca ,)urcee~ Secretar.La de la Presidencia. Tab ILL: PLANNED PUBLIC INTESTMENT PROGRAM FOR 1970 (Millions of Mex$) Treasury Own Co-Parti- Internal External onent(Estimated)L Total Resources Resources ciDationsL Credits Credits erex;t TOTAL PUBLIC INVESTMENT 10, 250.0 4 8,41 U22-8 Aricultural Sector 000.0 .821.1 20.0 816.7 1 0U 1,277 2 Iltt'ryof mydraulic Resources 3,072.9 1,12h.2 175720 .0 LO.7 759.0 922 30 The National Bank for the Development of Cooperatives (Fishery) 300.0 12.0 11.0 - 36.0 241.0 150 50 Ministry of Agriculture and Livestock 300.0 300.0 - - - - 81 27' Other Agencies 327.1 13.6 235.1 - - 78.4 124 38 Industrial Sector 11 ,0.0 8 818 - - 2,4. L101 eoleos IGiceanos (P79) 39 - 2 - 1,70( 1,230.0 1, 772 Federal Electricity Commission (CFE) 3,430.0 800.0 570.0 - 60.0 2,000.0 1,166 34 Mexican Light and Power Coipan 716.8 - 123.0 - 300.0 293.8 179 25 Altos Hornos de Mexico (Steel) 700.0 - 120.0 - 180.0 400.0 462 66 Industrial Company of Atenquique (Paper) 12.9 - 12.9 - - - 7 57 Guance y Fertilizantes (Fertilizer) 205.7 - 12L.6 - - 81.1 97 47 Other Agencies 745.0 35.0 368.4 - 155.6 186.0 253 34 Tranport Sec tor 6,o. 118 5 4617.0 55 8. 0 2- 4. 1 4. 24 DW blic Works 1 7.2 T iJL9.0 82.0 77 National Railways 1,262.9 390.0 - - 353.0 337.9 594 47 Pacific Railways 308.5 140.5 - - 126.8 41.2 108 35 Ministry of Transport and Communications 592.4 114.8 - - 192.6 285.0 533 90 Ministry of Marine 37C.1 161.3 - - 118.8 90.0 185 50 Other Agencies 565.9 118.9 384.8 - 54.2 8.0 249 Ub Social Sector 8 00.C 0 145L2 2 279.2 1,70.8 1 672.0 13l 17 feera trict - 1,77( - 3 0.09 Collective Transport System (Metro) 1,5oC.0 - 390.0 - 95.0 1,015.0 615 41 School Construction Program (CAPFCE) 950.0 30.0 - 100.0 820.0 - 9 1 Mexican Institute for Social Security (IMSS) 630.0 - 630.0 - - - 95 15 Minis try of Public Health and Welfare 426.4 100.0 23.0 161.1 142.3 - 21 5 Banco Nacional de Obras y Servicios Publicos (Housing) 250.0 - 10.0 - 240.0 - - Juntas Federals do Majoras Materiales (Improvement of Social Infrastructure in Border Areas) 250.0 55.0 99.0 16.0 80.0 - 12 5 Other Agencies 1,235.1 269.2 601.8 102.1 235.0 27.0 222 18 E;uipment for Adainietration and Defense 00.0 146.5 18( - 20.0 15 0 107 22 Department for the MiltazIndustry 1735 5 - - - - 10 70 Other Agencies 485.0 131.5 180.5 - 20.0 153.0 97 20 77 Partialy financed by local government. 72 Based on rough estimates made in 1969, for individual projects or groups of projects mainly by Secretaria de la Presidencia. Figures on foreign exchange com- ponent only give a general idea of the needs of the different agencies. Foreign exchange component includes depreciation of machinery used by private contractors working on public investment projects, and foreign parts in Mexican machinery used for these projects. / Direct component 25 percent. 3curce: Secretaria de la Presidencia, Mission estimates. Iaula .LP; rLaNZUJ rMAZUTO 1A IH KrWMEAL UUVLKKWNT INVESTMENT PROGRAM 1969 AND 1970 (Millions of pesos) 1969 1970 Agricultural Sector TOTAL 3,570 h 000 Ministry of Hydraulic Resources 2 937 073 Irrigation and Control of Rivers 12 1,533 Executive Committees of Regional Water Authorities >Yo >4f Regional Commissions of Studies 14 11 Uperation and Maintenance of Irrigation D1hstricts 33 2 Water and Sewerage 310 /1 Studies and lanning 102 Investigation of Ground Water 100 78 Other Investments 259 503 The National Bank for the Development of Cooperatives (acquisition of fishing boats and construction of cold storage plants) 215 300 Ministry of Agriculture and Livestock 195 300 Aariculture LL0 101 Livestock 50 52 Other Investments 11 b6 CONASUPO (construction of silos) 90 8 Other Investing Agencies 133 242 Industrial Sector TOTAL 130 U11 n r v rA-LCA Petroleum Plant Salamanca, Guanajuato l22 Petroleum Plant Minatitlan. Ver; Cru. /1 17 Other Petroleum Plants 180 8 Petrochemical Plants 240 331 Pioelines 253 397 Drillings for Petroleum 2,335 2,189 Purchase of Capital Goods 739 62.6 Auxiliary Installations h49 528 Other investments 747 670 Maintenance 156 20h 1 Included in "Other". -2- 1969 19-70 rederal Electricity Commisslon (F)4U5rou Hydroelectric Plants 1A 3 T"hermoelectric Pln- Geothermic Plants 58 49 Construction and Enlarrement of Substations 155 302 Transmission Lines 265 274 Local Investments 970 1,058 Maintenance 134 166 Change of Frequency in Parts of the Country 87 48 Other Investments 307 641 Altos Hornos de Mexico tsteel mu±1, iucrease of capacity from 1.5 to 2.5 million tons a year) 819 700 Mexican Light and Power Company 673 717 Construction and Enlargement of SubAtat.ion TRT 202 Transmission Lines 107 69 Local Investments 220 307 Maintenance 105 123 Other Investments 58 15 Industrial Company of Atenquique (manufacturer of paper in Jalisco) 137 13 Machinery 11 2 JU L LL1VrQU1iltlb Cf Guanos Fertilizantes (fertilI x) 13< 206 Investments in Plants 179 Maintenance 21 27 Other Investments in the Industrial Sector 1,306 745 Transport and Communications Sector 1MTAL 52775 6 5oo Railways 1,691 1 921 Pacific Railways 285 308 Othr Rnilwanv 111 1 Construction of New Lines by Ministry of Public Works 186 195 Roads - Ministry of Public Work and Caminos y Puentes 2 265 2 609 Construction 1,914 Maintenance 561 695 1969 1970 Airports - Ministry of Public Works and ASSA 438 651 Construction 2o0 Wf Other 158 14h Ports - Ministry of the Marine and Wexican Free Ports 278 378 Purchaen o nredgs. 2W 131 Other Investments 152 247 Ministry of Transport and Communications 315 565 Postal Investment 50 Telecommunications 200 251 Telegraph 60 115 Aeronaves de Mexico >U 70 fl ~ XI U r1U-UI dL vu(lIltl slivVatlmlu 419Jv[L U L11%;.LUUVU £JUV1U .)1114 Social Sector TOTAL 6950 81000 Department del Distrito Federal 2,125 2,758 Public .orks - streebb, tracks for streetcars, public movies and other 930 991 Wae fl'd Sewerag C ep mai ti1 cf Other Eewerage investments 77 260 Drinkin wnter nrort. of .1 t.n T--m 307 190 Other projects for potable water 35 135 Other investments 194 156 General Investments - office equipment and other 86 6 Other Investments Not Accounted For 151 270 Sistema de Transportes Collectivos (Metro) 12860 1,500 Const Lructo ;'ork 0V0K Purchase of Equipment and Installations - Metro cars 702 833 Studies 7- School Construction Program - CAPSE 1.0q4 950 Construction and Improvements of Rural and Urban Primary Schools 230 195 Construction of Secondary Schools Including Technical, Commercial and Agricultural Secondary Schools 373 210 Construction in Cooperation with the State of Governments 323 430 Maintenance and Various Investments 129 115 1969 1970 Instituto Mexicano del Seguro Social (mainly hospital construiction) *499 630 Secretaria de Salubridad y Asistencia (health stations and Banco Nacional de Obras v Servicios Publicos (financing of low-cost housing) 280 381 Juntas Federales de Mejoras Materiales (improvement of social infrastructure in border areas and ports) 140 250 Other Investments 248 85h Equipment for Administration and Defense TOTAL 280 500 De-3rtment of Military Industry (modernization of machinery in old rifle factory) 140 15 SEcretaria de la Defensa Nacional 61 200 Public Buildings and Equipment for the Administration 79 285 Scqly.7-e Secre.t-ax-f-a hAn 1- Presidencia, Table 5.16: PUBIC SECTOR FINANCES - PROJECTIONS, 1970-1976 (Billions of 1970 pesos) 1970-1976 1970 :1971 1972 1973 197, 1975 1976 Average rate (N) A. ALTERNATIVE ASSIMING NO NEW MAJOR REVENUE MEASURES PLblic sector savings 15.0 15.1 15.5 15.7 15.7 15.9 16.1 ( 1.2) Net financing requirerments 13.4 11.8 12.6 15.1 17.3 19.0 20.8 ( 7.6) Net dcnestic borrowing 9.1 7.2 7.7 10.0 12.1 13.8 15.9 ( 9.1) Net external borrowing 4.o h.6 4.9 5.1 5.2 5.2 4.9 ( 3.) Amortization (external) 7.0 6.2 7.9 10.3 11.8 13.6 13.6 ( 11.7) Gross external borrowing 11.0 10.8 12.8 15.1 17.0 18.8 18.5 ( 9.0) Debt service ratio (%) 23.5 23.7 26.7 31.0 32.6 3).3 32.7 B. ALTERNATIVE ASSUMING SIGNIFICANT NEW REVENUE MEASURES Public sector savings 15.0 18.6 19.2 19.6 19.9 20.3 20.8 ( 5.6) Net financing requirerents 13.4 8.3 8.9 11.2 13.1 1)4.6 16.1 ( 3.1) Net dmestic borrowing 9.b 6.0 '6.1 8.6 10.5 12.0 13.6 ( 6.1) Net external borrowing 4.0 2.3 2.5 2.6 2.6 2.6 2.5 (- 7.5) Aiortization (external) 7.0 6.4 7.4 9.1 9.5 11.3 9.7 ( 5.6) Gross external borrowing 11.0 8.7 9.9 11.7 12.1 13.9 12.2 ( 1.7) Debt serrLce ratio (N) 23.5 23.7 25.2 27.5 26.8 26.9 2b.2 C. ADDITIONAL PUBLIC R] VEN1jES REQUIRED FOR ALTERNATIVE B - 3.5 3.7 3.9 h.2 4. 4 .7 ( 6.0) 1/ Assiming that two-thirds of new revenues cone out of private consumption and orie-third out of private savings, and assuming that the overall savings rate of the economy increases. Source: Mission estimates.  Table 5.17: SECTORAL VALUE ADDED, GROSS, INDIRECT AND DIRECT TAX DISTRIBUTION AND TAX BURDEN, 1966 (Million pesos) Value rTotal Tax Indirect r indirect Direct T Di re c-t Sector Added Tax Total Burden/1 Tax Total Tax Burden Tax/2 Total Burden Agriculture, Forestry, Fishing 34,390 446 2.2 .013 185 1.4 .005 260 9.6 .008 Mining and PetroleuM 11,249 2,137 19.9 .190 985 7.3 .088 1,152 15.9 .102 Manufacturing and Comierce/3 136,363 12,617 60.5 .093 10,600 78.0 .078 2,017 27.8 .015 Construction 19,189 375 1.8 .020 0 0.0 .000 375 5.2 .020 Power 3,927 733 3.5 .187 46 3.4 .118 269 3.7 .069 Tran sportation 7,753 1,960 9.4 .253 636 4.7 .082 1,324 18.3 .171 Services 52,897 2,566 12.2 .049 711 5.2 .013 1,855 25.5 .035 'OTAL 256,768 20,832 100.0 .081 13,582 100.0 .053 7,25O 100.0 .028 /1 Tax Burden - Tax/Value Added. /2 Direct Tax = Gross Tax - Indirect Tax. /3 Sectors combined due to lack of information on the real incidence of excise taxes. Source: Secretarfa de Hacienda, Bank of Mexico.  Table 6.1: CONSOLIDATED SUMMARY ACCOUNTS OF THE BANKING SYSTEM (In billions of pesos) End of Period 1963 1964 1965 1966 1967 1968 1969 1/ Foreign assets 7.95 8.36 7.72 7.89 9.79 11.14 9.91 Silver holdings 0.21 0.07 0.25 0.25 0.44 0.17 0.49 Foreign exchange subscriptions to non- monetary international organizations 0.49 0.50 0.50 0.54 0.54 0.54 0.54 Domestic credit 60.79 74.00 86.65 100.88 119.13 136.33 163.86 To public non-financial sector 13.71 17.39 21.56 28.15 31.72 35.58 42.11 To private sector 46.43 55.87 65.14 75.16 88.87 99.57 117.85 Unclassified, net 0.65 0.14 -U.06 -2.43 -1.46 1.18 3.90 Assets (7.90) (9.05) (9.51) (7.83) (9.87) (12.21) (16.16) .iabilities (-7.24) (-8.31) (-9.56) (-10.26) (-11.33) (-11.03) (-12.26) Interbank float, net 1.94 1.69 1.87 2.39 3.15 4.12 3.49 Total assets (- Total liabilities) 71.38 84.62 96.99 111.95 133.05 152.30 178.29 Liabilities to private sector 52.63 63.78 72.78 84.89 101.73 119.02 139.02 Currency in curculation 10.26 11.92 12.51 13.63 14.75 1 8 18.23 Monetary deposits 13.42 15.72 17.01 19.12 20.64 23.31 26.11 Sight, time, and savings deposits 5.16 6.32 7.45 8.48 9.63 11.07 12.80 Deposits in foreign currency 2.10 2.39 2.37 2.46 2.77 2.90 3.01 Securities outside the banking system 7.66 10.34 14.9, 23.02 33.58 42.78 49.64 Other ohlietions 1602 17zl0 18M54 i8.1R 207 22.28 29.23 Liabilities to foreign residents 10.34 11.45 13.28 15.92 19.40 21.04 25.12 Capital and reserves 8.41 9.40 10.93 11.13 11.91 12.24 14.14 1/ Preliminary. Source: Bank of Mexico Table 6.2: SUMMARY ACCOUNTS OF THE BANK OF MEXICO (In billions of pesos) End of Period 1963 1964 1965 1966 1967 1968 1969 International reserves, net 6.78 7.34 6.68 6.96 8.16 9.29 8.49 Assets 6.85 7.38 6.72 7.26 8.27 9.47 8.64 a A tie Al. .7 AA. A -0.0 11 10 A Silver holdings 0.21 0.07 0.25 0.25 0.44 0.17 0.49 Foreign exchange subscriptions to non- Identified domestic credit 8.25 9.95 11.31 12.86 14.21 16.71 20.37 To public nonfinancial sector (net)l/ / 6.91 7.06 8.18 11.64 12.90 14.67 16.83 To governUenL Uanks l u*. 2* 1.2. nv.u .q 0.U.7 To private banks 2/ 0.02 0.46 0.28 0.12 -- -- 0.12 To private nonfinancial sector 0.39 0.34 0.53 0.84 1.54 1.27 1.37 Unclassified, net -0.34 0.81 1.07 -0.52 -1.49 -0.43 1.26 - ------ 1 n1% 2.27 1'q a'll% I A.&% tA 'IAN /n qnx. -1 n Liabilities (-2.26) (-1.46) (-1.85) (-1.98) (-2.19) (-2.72) (-2.68) Total assets (=total liabilities) 15.73 17.86 18.74 20.61 23.35 26.71 29.89 Currency and deposit obligations to banks 3.85 4.36 4.37 5.02 6.04 7.54 8.70 Obligations to private sector 11.18 12.69 13.51 14.76 16.20 17.91 19.86 Currency in circulation 10.26 11.92 12.51 13.63 14.75 16.68 18.23 Demand deposits 0.37 0.40 0.55 0.66 0.89 0.78 0.78 Deposits in roreign currency u.u1 0.01 0.02 u.0 u.03 U.u U.ut Other obligations 0.53 0.36 0.44 0.45 0.53 0.43 0.78 Capital and reserves 0.71 0.81 0.85 0.83 1.11 1.26 1.33 SOURCE: Bank of Mexico. 1/ Net credit extended less government deposits. 2/ Loans made to other banks aeninst eovernment securities which they have bought from the Rank of Mexico (in fulfillment of certain reserve requirements) and pledged as collateral for these loans are here treated as credit to the public non-financial sector, rather than as claims on the borrowing banks. Table 6.3: SUWARY ACCOUNTSOF TE GovBanarT BANKS (In billions of pesos) End of Period rA, I nzj. 101 1966 1967 10KA 1069 2/ Foreign assets V ., V M.,' 0.16 0 .. .0 02 Reserve deposits and currency holdings 0.21 0.20 0.16 0.33 0.27 0.15 0.30 Domestic credit 26.44 30.62 34.74 37.71 44.90 50.70 56.75 To public nonfinancial sector 1/ 0.43 0.60 2.26 1.91 1.22 0.67 1.63 To government banks 1.67 2.46 2.62 3.14 3.81 5.67 6.89 To private banks 0.34 0.35 0.53 0.58 0.67 0.59 0.37 To private nonfinancial sector 23.12 26.94 30.48 33.12 38.00 40.71 44.90 Unclannified nor n .R n 27 -1l15 -1.04 1-20 3.06 2.96 Assets (3.82) (3.82) (3.00) (3.66) (6.21) (6.77) (7.31) Liabilities (-2.94) (-3.55) (-4.15) (-4.70) (-5.01) (-3.71) (-4.35) Liabilities to Bank of Mexico 1/ 1.27 1.28 1.25 0.78 1.26 1.20 0.79 Liabilities to other banks 3.68 5.04 5.74 7.25 7.57 9.10 10.90 Liabilities to private sector 7.86 9.05 9.66 9.62 12.51 15.37 15.33 Monetary deposits 0.22 0.23 0.24 0.28 0.29 0.15 0.18 Sight, time, and savings deposits 0.95 0.83 0.87 1.02 1.13 1.09 1.52 Deposits in foreign currency 0.01 0.01 0.01 0.01 0.01 0.01 0.02 Securities outside the banking system 3.o 3.9 4a.4 4.6u J.o 7.25 9.57 Other obligations 2.87 4.06 4.12 3.72 5.18 6.87 5.04 Liabilities to foreign institutions 10.27 11.41 13.24 15.62 19.29 20.86 24.97 Canital and reserves 3.66 4.10 5.17 4.93 4.82 4.52 5.32 Source: Bank of Mexico. 1/ In order to avoid double-counting of credit flows financed through Bank of Mexico re-lending against required security reserves. amounts borrowed from the Bank of Mexico anainat 2overnment securities pledged as collateral for such loans are here netted out of credit to the public nonfinancial sector, rather than counted as liabilities to the Bank of Mexico. 2/ Preliminary. SA 1. . qTMARY ArrTINWTS OF THR DEPOSIT AND SAVINGS BANKS (In billions of pesos) End of Period 1963 1964 1965 1966 1967 1968 1969 3/ Foreign assets 0.70 0.83 0.65 0.41 1.03 1.23 0.89 Reserve deposits and currency holdings 3.58 4.04 4.08 4.6 5.05 6.31 7.0 Domestic credit 17.89 21.70 24.29 27.45 29.22 33.14 38.95 To public nonfinancial sector 1/ 3.90 5.19 5.60 6.25 6.23 7.03 7.68 To government banks 00 0 QQ 0. R 1 71 1 01 0 8A 1. 3 To private banks 3.53 3.67 3.37 3.75 3.98 4.14 5.45 To private nonfinancial sector 9.47 11.88 14.42 16.03 17.74 20.67 23.71 Unclassified, net 0.09 -0.03 0.02 0.21 0.26 0.44 0.72 Assets (1.13) (1.22) (1.46) (1.73) (2.05) (2.51) (3.10) Liabilities (-1.04) (-1 25 (-1 Ad) (-152 (-1.791 (-2_07) (-. R Liabilities to Bank of Mexico 1/ 2/ 0.02 0.46 0.28 0.12 0.02 -- -- Liabilities to other banks 0.84 0.65 0.78 1.11 1.16 1.65 3.18 Liabilities to private sector 19.49 23.39 25.64 28.81 31.47 36.14 40.45 Monetary deposits 12.82 15.08 1o.23 10.10 19.46 22.3o L.14 Sight, time, and savings deposits 4.03 5.27 6.33 7.20 8.20 9.71 10.92 Denosits in foreian currency 2.08 2.37 2.34 2.43 2.68 2.87 2.92 Other obligations 0.56 0.66 0.74 1.00 1.14 1.18 1.47 Capital and reserves 1 o. . - n 1 Source: Bank of Mexico. 1/ In order to avoid double-counting of credit flows financed through Bank of Mexico re-lending against requred amounts boroe fronm the B~ank of Mexico against government scu,rities pledged as collateral for such loans are here netted out of credit to the public nonfinancial sector, rather than counted as liabilities to the Bank of Mexico. 2/ Derived from records of the Bank of Mexico; includes some liabilities of Other Private Banks. 3/ Preliminary. Table 6.51 SUNARY ACCOUNTS OF PMAvs CRDIT INSTTMloS OTHER THAN DEPOSIT AND SAVINGS BANKS tTn h4114 nf pasos End of Period 1963 1964 1965 1966 1967 1968 1969 / Foreign assets 0.29 0.10 0.19 0.05 0.21 0.24 0.11 Reserve deposits and currency holdings 0.77 0.32 0.34 0.60 0.94 1.23 1.49 oUWestiC credit 17.9 2J.UJ 2o.JU JU.&4 MJo.d 6 To public nonfinancial sector 1/ 2.47 4.53 5.52 8.35 11.37 13.21 15.97 To government banks 1.31 2.06 2.52 2.81 2.95 3.15 3.14 To private banks 0.64 0.63 0.73 0.98 1.15 1.55 1.46 To prvat nonfinanc al sector 13.45 16.70 19.71 25.17 31.59 36.92 47.87 Unclassified, net 0.03 -0.29 0.02 -1.09 -1.43 -1.89 -1.06 Assets (1.03) (1.74) (2.13) (0.98) (0.91) (0.64) (1.79) Liabilities (-1.00) (-2.03) (-2.11) (-2.07) (-2.34) (-2.53) (-2.85) LihilitieB tn Rank of Meio 11 -- 0.21 0.41 Liabilities to other banks 2.66 2.97 2.47 2.29 1.89 1.03 0.97 Liabilities to private sector 14.08 18.65 23.97 31.69 41.55 49.60 63.36 Sight, time, and savings deposits 0.17 0.22 0.25 0.26 0.30 0.27 0.36 Deposits in foreign currency -- -- -- -- 0.04 -- Securities outside the banking system 3.85 6.41 10.48 18.42 L.D9 35.53 . .0u Other obligations 10.05 12.01 13.23 13.01 13.52 13.80 21.93 Capital and reserves 2.23 2.43 2.59 2.89 3.34 3.57 4.24 Source: Bank of Mexico. 1/ In order to avoid double-counting of credit flows financed through Bank of Mexico re-lending against required security reserves, amounts borrowed from the Bank of Mexico against government securities pledged as collateral for such loans are here netted out of credit to the public nonfinancial sector. rather than counted as liabilities to the Bank of Mexico. 2/ Preliminary. TøA 6.6 MONEPY TTPPTY (In billions of pesos) Checking Money Supply In Percent Year Ciur-rncy Accounts Actual Increase (l)of (3) (2) of (3) (1) (2) (3) (h) 1949 2.378 1.975 4.353 -- Sh.6 h5.4 1 297 l7. . 3R7 A8.7 5A.3 1951 3.658 3.342 6.800 13.6 50.9 49.1 O AIo'1 ),90 7 (Y7A ).ci _j9_2 3.- 3.429/ 7.7 -. i1.6 4. 1953 3.86h 3.788 7.652 8.1 50.5 49.5 1954 h.637 4.087 8.724 14.0 53.2 46.8 i ~ R).1 . ý-. -in c'i1 7 )n A i.~ p~r'~ 19 5 5.084 5.433 1l.57 20.6 8.3 61 .7. 1956 5.734 5.958 11.692 11.1 49.0 51.0 97(_ 6.093 I. nn00 i- 12.493 6. . 5. 1958 6.615 6.774 13.389 7.2 49.4 50.6 1959 7.250 8.184 15.43h 15.3 47.0 53.0 160u 7.875 9.05) 16.89 9 4Q6.6 53. -L 1961 8.275 9.732 18.007 6.6 46.0 Sh.0 -L44 L-L L-)vý v ý -L U;)..L 1963 10.264 13.416 23.680 16.8 43.3 56.7 1964 11.923 15.717 27.640 16.7 43.1 56.9 1965 12.507 17.012 29.519 6.8 2.h 57.6 1966 13.630 19.122 32.752 11.0 h.6 58.4 1967 lh.749 20.638 35.387 8.0 l.7 58.3 1968 16.674 23.317 39.991 13.0 4l.7 58.3 1969 18.250 26.045 h.295 10.8 4l.2 58.8 Source: Bank of Mexico. TablQ 6.7: PRIVATE HOLDINGS CF MONEY AND QUASI-MONEY TAT -P T ArPTfhT P-1 ATTrMTTP AATM TMTw'OrP1TrP Lf .kL4.Jffl.t-SJ A wL %.LIJ L £1 ±MJJ. .L1U. tLAt,, - ± kIn i ±l-lions. of pesos, except as U 1964 1965 1966 1967 1968 1969 19701/ Gross domestic product 224.9 248.1 277-5 301.6 334.5 370.4 4o0.3 Gross fixed investment 43.3 5u.1 61.3 4.2 71.6 74.1 1.7 Year-end holdings 63.8 72.8 84.9 101.7 119.1 139.6 161.9 Money 977 2 32.7 3.7 .0.0 . Quasi-money 36.2 43.3 52.1 66.3 79.1 5.3 ** Annual changes 11.2 9.0 12.1 16.8 17.4 20.5 22.3 Money 3.9 Quasi-money 7.3 7.1 8.8 14.2 12.8 16.2 Year-end holdings (as per cent of GDP) 28.4 29.3 30.6 33.7 35.6 37.7 39.7 Money 12.3 11.9 11.8 11.7 12.0 12.0 Quasi-money- 16.1 17.5 18.8 22.0 23.6 25.7 Annual changes As per cent of GDP 4.9 3.7 4.4 5.6 ..5 Money 1.7 . 1.2 0.9 1.2 ... Quasi-money 3.2 2.9 3.2 4.7 3.8 4.4 ... As per cent of gross fixed investment Quasi-money 16.8 14.2 14.4 22.1 17.9 21.9 Money and quasi-money 25.9 18.0 19.7 26.2 24.3 27.7 27.3 Source: Bank of Mexico Staff estimates. T*hl , * FTAiANCTN. CAPACTTY O T9E RANKTNG SYSRTEM 1961 1962 1963 1964 196.5 1966 1967 196816" nance* ~Phr of Year Gold, silver and foreign currencyr C.9 62 81 8.7 8. 7.9 9 n in- 10 Credit and investment securities 37.9 .h 41.8 L)1 1 77-8 868 98.8 11 1 1 8 L Unclassified assets 5.7 6.2 8.1 9.3 8.6 8.2 11.4 14.5 12.5 Assets = Liabilities 49.5. 56.9 68.0 82.1 94.6 102.9 119.7 136.8 161.2 Money Supply 18.1 20.3 23.7 27.7 29.6 32.7 35.4 40.0 44.3 internal Liabilities q/ 2 29Q 9Q 017-n 61 ()h 6n C 7V3 - 6 A 0R i A Capital and Reserves 6.5 6.7 7.3 8.3 9.6 9.7 10.0 10.6 12.1 Annual Changes currency -0.1 0.3 1.9 0.6 -0.5 -0.3 1.6 0.7 0.1 ureu.LU MiU -ilV esOULlU securities 4.4 6.6 7.3 12.3 13.7 9.0 12.0 13.3 26.3 A.~- T - -.. 1..1 A ~ 7.. .1 -1 1. -1 -10 1 A ~ 1 A.A 7 . ol .I Iliuney 0Uy j±v C .L 4v .. J. C . I 4-uL 14--) Internal Liabilities 4.0 5.0 7.1 9.1 9.3 5.1 13.8 11.9 18.6 uapiumL wiu Reserves v.u v.c v.u w.v i. v.± v.) v.v ±. a/ Computed by subtracting from the consolidated liabilities of the banking system (except money supply, and capital and reserves) the total of sight and time liabilities in foreign currency as follows: Liabilities Other than Sight and Time Money Supply Liabilities Internal Total Monev Canit-l X Canita] & in T.i ahiliti Year Liabilities Supply & Reserves Reserves Foreign Currency 1961 57.6 18.1 6.5 33.0 8.1 24.9 1962 65.7 20.3 6.7 38.7 8.8 29.9 1963 77.5 23.7 7.3 46.5 9.5 37.0 1964 92.4 27.7 8.3 56.4 10.3 46.1 1965 105.1 29.5 9.6 66.0 10.6 55.4 1966 120.7 32.7 9.7 78.3 17.8 60.5 1967 142.0 35.4 10.0 96.6 22.3 74.3 1968 163.5 40.0 10.6 112.9 26.7 86.2 1969 1/ 190.2 44.3 12.1 133.8 29.0 104.8 1 Preliminary Source: Bank of Mexico Table 6.9: BANKING SYSTEM FINANCING BY DESTINATION End of Year Balances, 1950-1969 (In millions of pesos) Federal and YeAr (overnent. Tnditrv T.Ivantni-k crmmArr Mining Total 1950 2,066.3 b,009.6 1,059.9 1,811.1 25.8 8,972.7 1951 1,816.1, 5,386.9 1,230.0 2,307.6 26.4 10,767.3 1952 1,977.1 5,836.3 1,507.1 2,546.5 20.5 11,887.5 1953 2,379.2 6,6Uå.h 2,015.8 2,1637.2 21.2 13,b97.8 195h 2,967.3 8,5h.8 2,103.5 3,151.7 h.1 16,811.h 1955 3,185.7 8,252.5 2,786.7 3,390.3 57.5 17,672.7 1956 3.002.7 9,152.9 3.277.3 h.173.9 50.8 19.657.6 1957 3,625.0 1o,h83.4 3,561.h 4,733.9 60.3 22, 6.0 1958 h,579.8 12,609.5 3,998.8 5,330.8 6h.4 26,583.3 1959 4,269.4 15,076.7 b,738.5 7,116.6 67.8 31,269.0 1960 5,643.3 19,798.8 5,811.9 8,h63.6 62.9 39,780.4 1961 5,475.2 24,424.1 6,582.8 9,h95.3 78.5 46,055.9 196i ,3 . 7,361.7 ifU.L9, C7.2.L4 53,5L. 1963 8,958.0 32,800.4 8,237.0 11,0h2.8 213.3 61,251.5 1961 12,856.1 3R,700i 9,317.9 13,318.2 212.7 7),13,.9 1965 20,h73.h 42.0U.2 10.635.3 13.989.7 231.4 87.37h.0 1966 27,386.3 h6,630.9 12,688.8 17,h17.7 505.8 loh,629.5 1967 30,070.0 55,301.6 14,025.6 20,697.8 1,010.3 121,105.3 1968 35,183.0 62,468.1 15,355.9 24,57h.1 1,186.5 138,767.6 1969 h2,b72.7 75,Ohh.1 16,188.0 31,797.5 1,722.6 167,22L.9 1/ Does not include operations of the Government Trust Fund for Agriculture which is administerer by Bank of Mexico. Source: Bank of Mexco. Table 6.10: BANKING SYSTEM FINANCING BY DESTINATION, 1960-1969 Agriculture 2! Federal and Year Government Industry Livestock Commerce Mining Total Change in Percent 1961 - 3.0 23.4 13.3 12.2 24.8 15.8 1962 2 . 5 215.0 11.8 2.2 206.2 16.1 1963 59.6 7.1 11.9 13.8 - 11.3 14.6 19. 3.5 18.0 13.1 20.6 13.8 21.5 1965 59.3 8.6 14.1 5.0 - 4.7 17.h 1966 33.8 10.9 19.3 26.5 U8.6 19.7 1967 9.0^ 18.6, 10.5 18.8 99.7 15.7 1968 17.0 13.0 9.5 18.7 17.4 14.6 1969 20.7 20.1 5.4 29.4 45.2 20.5 As Percent of Total 1960 14.2 49.8 14.6 21.3 0.1 100.0 1961 11.9 53.0 14.3 20.6 0.2 100.0 1962 10.5 57.0 13.8 18.2 0.5 100.0 1963 14.6 53.6 13.4 18.0 0.4 100.0 1964 17.3 52.0 12.5 17.9 0.3 100.0 1965 23.4 48.1 12.2 16.0 0.3 100.0 1966 26.2 44.6 12.1 16.6 0.5 loo.o 1967 24.8 h5.7 11.6 17.1 0.8 100.0 1968 25.3 6.o 11.1 17.7 0.9 100.0 1969 25.h 44.9 9.7 19.0 1.0 100.0 1/ Does not include operations of the Government Trust Fund for Agriculture which is administered by Bank of Mexico. Source: Bank of Mexico. Table 6.11: FINANCING EXTENDED BY BANKING SYSTEM i/ Holdings of Securities and Net Credits (In millions of pesos) December December December Percent Chare Type of Financing 1967 .1968 1969 2/ 1968/7- 1969/68 Total Financing 121,105.3 138,767.6 167,22U.9 14.6 20.7 To enterprises and individuals 91, 035. 3 103,584.6 124,752.2 13.8 20.7 Securities 7,858.1 8,742.9 10,235.8 11.3 17.4 Credits 83,177.2 94, 8LL.7 114,516.4 14.o 21.1 Commercial 20,697.8 2 4,57 4.1 31,700.7 18.7 29.4 For Production 62,479.4 70,267.6 82,815.7 12.5 18.1 Industry 47,4435 5.3,725.2 65,132.1 13.2 21.4 Agriculture & Livestock 14,025.6 15,355.9 15,983.0 9.5 .6 Mining 1,010.3 1,186.5 1,700.6 17.h 45.2 To the Federal Government 30,070.0 35,183.0 42,472.7 17.0 20.5 Securities 29,162.1 33,852.6 41,466.9 16.1 22.5 Credits 907.9 1,330.h 914.6 46.5 -31.3 lf Includes securities and credits of common funds of certificates of participation of the Nacional Financiera, S.A. 2/ Prelirinary Note: Figures are partially compensated in the case of Government securities with loans which the Bank of Mexico mTakes to the private credit institutions in accordance with various dispositions. Source: Bank of Mexico Table 6.12: FINANCING EXTENDED BY BANK OF MEXICO Holdings of Securities and Net Credits (In millions of pesos) December December December Percent Change Type of Financing 1967 1968 1969 19687/F 1L969/68 Total. Financing 12,458.2 13,504.8 18,805. 4 8.24 39.3 To enterprises and individuals 3,702.9 2,259.0 1,639.6 -39.0 -27.4 Securities 913.1 648.2 623.5 -29.0 -3.8 Credits 2,787.8 1,610.8 1,016.1 -42.3 -36.9 Commercial 280.9 146.2 179.6 -48.0 22.8 For Production 2,508.9 1,464.6 836.5 -41.6 -42.9 Industry 1,324.0 239.7 86.7 -81,9 -63.8 Agriculture & Livestock 1,184.9 1,224.9 749.8 3.4 -38.8 Mining To the Federal Government 8,755.3 11,245.8 17,16r.8 28.4 52.6 Securities 7,847.2 9,915.4 16,251.2 26.4 63.9 Credits 907.9 1,330.4 9124.6 h6.5 -31.3 Note: The investment in Central Government Securities is compensated by loans which the Bank of Mexico extends to the credit institutions in accordance with various dispositions. Source: Bank of Mexico. Table 6.13: FINANCING EXTENDED BY DEPOSIT AND SAVINGS BANKS Holdings of Securities and Net Credits (In millions of pesos) December December December Percent Change Type of Financing 1967 1968 1969 1968767 1969/68 Total FLnancing 23,971.8 27.704.4 31,585.6 15.6 14.0 To enterprises and individuals 17,740. 20,672.1 23,906.9 16.5 15.6 Securities 871.1 1,054.5 1,300.2 21.1 23.3 Credits 16,869.3 19,617.6 22,606.7 16.3 15.2 Commercial 7,591.2 9,004.5 10,602.6 18.6 17.7 For Production 9,278.1 10,613.1 12,004.1 14.4 13.1 Industry 6,545.3 7,395.8 8,545.3 13.0 15.5 Agriculture & Livestock 2,682.2 3,13d.,8 3,368.4 17.0 7.3 Mining 50.6 78,5 90.4 55.1 15.9 To the Federal Government 6,231.4 7,032.3 7,678.7 12.9 9.2 Securities 6,231.4 7,032.3 7,678.7 12.9 9.2 Credits -- -- -- -- -- Source: Bank of Mexico. Note: The investment in Central Government Securities is compensated by loans which the Bank of Mexico extends to the credit institutions in accordance with various dispositions. Table 6.14: FINANCING EXTENDED BY THE PRIVATE CREDIT INSTITUTIONS Holdings of Securities and Net Credits (In millions of -pesos) December December December Percent Change Type of Financing 1967 1968 1969 1968/7 1969/68 Total Financing 66,932.5 78,728.7 96,498.8 17.6 22.6 To enterprises and individuals 49,327. 58,475.5 72,823.4 18.! 2)4.5 Securities 4,137.2 4,299.2 5,2433.5 3.9 26.24 Credits 45.,190.2 54,276.3 67,389.9 19.9 26. 4 Commerci al 19,058.5 23,139.3 30,028.6 21.4 29.8 For Production 26,131.7 31,037.0 37,361.3 18.8 20.4 Industry 21,251.5 25,266.9 30,810.8 18.9 21.9 Agriculture & Livestock 3,870.0 4,583.6 4,827.9 18.. 5.3 Mining 1,010.3 1,186.5 1,722.6 17. It45.2 To the Federal Government 17,605.1 20,253.2 23,675. 15.0 16.9 Securities 17,605.1 20,253.2 23,67.4 15.(0 16.9 Credits -- 3ource: Bank of Mexico. Iote: The investment in Central Government Securities is compensated by loans which the Bank of Mexico extends to the credit institutions in accordance with various dispositions. Table 6.15: FINANCING EXTENDED BY OTHER PRIVATE GREDIT INSTITUTIONS Holdings of Securities and Net Credits (In millions of pesos) December December December Percent Ch ange Type of Finncing 1967 -1968 1969 196/7 1969/68 Total Financing 9,430,8 10,960.3 12,949.6 16.2 18.2 To enterprises and individuals 7,786.9 9,138.5 10,463.1 17.4 1-.5 Securities 329.0 346.8 407.3 5.4 17.5) Credits 7,457.9 8,791.7 10,055.8 17.9 14.3 CommE!erci al 3,393.3 3,982.6 .4,736.3 17.4 18.9 For Production 4,064.6 4,809.1 5,319.5 18.3 10.6 Industry 3, 982.5 4,729.9 ., 249.1 18.8 11.0 Agriculture & Livestock 82.1 79.2 70.4 -3.5 -11.1 Mining - - . - To the Federal Government 1,643.9 1,821.8 2,486.5 10.8 36.5 Securities 1,643.9 1,821.8 2,486. 10.8 36.5 Credits - - - - Source: Bank of Mexico. Table 6.16: FINANCING EXTENDED BY I~NVESMENT COMPANIES (FINANCIERAS) Holdings of Securities and Net Credits (In millions of pesos) December December December Percent Change Type of Financing 1967 1968 1969 1968/7 - 1969/68 Total Financing 33,529.9 40,064.0 51,963.6 17.5 29.7 To enterprises and individuals 23,800.1 28,664.9 38,453.4 20.4 34.1 Securities 2,937.1 2,897.9 3,726.0 -1.3 28.5 Credi ts 20,863.0 25,767.0 34,727.4 23. 5 34.8 Commerc i al 8,074.0 10,152.2 14,689.7 25.7 >44.7 For Production 12,789.0 15,614.8 20,037.7 22.1 28.3 Industry 10,723.6 13,141.1 17,016.4 22.5 29.5 Agriculture & Livestock 1,105.7 1,365.7 1,389.1 23.5 1.7 Mining 959.7 1,108.0 1,632.2 15.5 47.3 To the Federal Government 9,729.8 11,399.1 13,510.2 17.2 18.5 Securities 9,729.8 11,399.1 13,510.2 17.2 18.5 Credits -- -- -- - Source: Bank of Mexico. Note: The investment in Central Government Securities is compensated by loans which the Bank of Mexico extends to the credit institutions in accordance with various dispositions. Table 6.17: FINANCING EXTENDED BY PUBLIC CREDIT INSTITUTIONS Holdings of Securities and Net Credits (In millions of pesos) December December Dec ember Percent Change Type of Financing 1967 1968 1969 1968/7 1969/68 Total Financing 41,714.6 46,534.1 52,11.2 11.6 12.1 To enterprises and individuals 38,005.0 42,850.1 50,610.9 12.8 18.1 Securities 2,807.8 3 ,795. 4,208.8 35.2 10.9 Credits 35,197.2 39,0L'.6 46,402.1 11.0 18.8 Cormnercieal 1,358.4 1,288.6 1,589.7 --5.1 23.4 For Production 33,838.8 37,766.0 L4,812.L6 i.6 18.7 Industry 2)4,868.1 28,218.6 3)4.331. 8 13.5 21.7 Agriculture & Livestock 8,970.7 9,547.4 10,480.6 6.4 9.8 Mining - - To the Federal Governmert 3,709.6 3,684.0 1,540.3 -0.7 -58.2 Securities 3,709.6 3,68 4.0 1,1c0.3 -0.7 -58.2 Credits Source: Bank of Mexico 1/ Includes securities and credits of common funds of certificates of participation of the Nacional Financiera, S.A. 2 Preliminary. M-.1 4 -1. AODTTTTTWT1DAT CVOPMD - A/ VAE ADDEAND BANKING SYSTEM CREDIT (Millions of pesos - current prices) Value Added Credit Ratio (1) (2) (1 i 2) 1960 32,166 6,013 5.3 1961 34,628 6,845 5.1 1962 37,365 7,646 4.9 1963 40,615 8,524 4.8 1964 45,688 9,746 h.7 1965 48,585 11,345 4.3 1966 50,005 13,7b6 3.6 1967 52,961 15,296 3.5 1968 55,615 16,876 3.3 1969 59,180 17,905 3.3 Source: Bank of Mexico 1/ Agriculture, Livestock, Forestry, Fishing. 2/ Includes financing by Guarantee and Development Fund for Agriculture. 3/ GDP at market prices. Table 6.19: Gross Financing Extended by Bank of Mexico to Public Sector (In millions of pesos) D E C E M :3 E R Percent Chang 1967 1968 1969 196/67 1969/6 I. Gross Financing to Federal Government 35,574.6 39,502.1 45,662.8 11.0 15.6 A. Investment in Securities 33,879.1 38,35.o L5086.1 13.2 17.5 a) Internal Debt Guarantee 33,835.1 38,319.2 45,052.3 13.3 17.6 b) External Debt 44.o 36.2 33.8 -17.7 -6.6 B. Credit 1,695.5 1,146.7 576.7 -32.4 -49.7 Financing 759.9 6,43.5 283.1 -15.3 -56.c) Checking accounts of the Treasury 73.9 245.4 465.5 232.1 89.7 Others 1,009.5 748.6 759.1 25.8 1.4 II. Gross Financing to Public Sector gencies and Firms 6724.8 643.7 1167 4.6 - 81.9 III. Gross Financing to Public Sector Banks ,138.2 1j844.0 1930.8 2.0 4.7 Gross Financing to Public Sector 38,057.6 41,989.8 47,710.3 10.3 13.6 Source: Bank of Mexico, Table 6.20: Mexico: Banking System Securities Held by I.L. I U £.L. -i - "- Outstanding Annual Change Outstanding Dec. 31 Dec. 31 1963 VLYi i9b 1Ybb 1967 196 1969 1969 Total, banking system 7.7 2. 4.6 8.1 1u.6 9.0 7.0 49.7 Government banks 3.8 0.1 0 * 0.2 1.3 1.3 2.6 9.8 Nacional Financiera 2_7 0 . 1 07 0 2.2 7.2 Financial bonds and titles 1.8 0.1 0.5 0.1 0.9 0.8 1.9 6.1 Participation certificates 1.0 0.2 -0.3 -- -0.1 -- 0.3 1.1 Other government banks 1.0 -0.2 0.3 0.1 0.5 0.5 0.5 2.7 Mortgage bonds and mort- gage participation bonds 0.6 -0.2 0.1 0.1 0.5 0.5 0.6 2.2 Financiabonds 0.4 -- 0.2 -- -- -- -0.1 0.5 Private banks 8 . 4.1 7.9 9.3 7.7 3 40.7 Financieras 2.6 1.3 .7 7 . 7. 2. Financial bonds 2.6 1.3 2.4 2.7 3.7 2.7 1.6 17.0 Certificates of deposit -- -- -- 2.7 3.8 3.2 2.0 11.7 Mortgage banks 0.6 1.2 1.6 2. 1.b 1. 1.6 11.1 Mortgage bonds o.7 1.2 1.6 2. 1. 1.7 1. 11.1 Capitalization banks 0.6 0.1 0.1 0.1 0.9 Savings policies 0. 0.1 0.1 -- -- -- 0.1 0.9 Source: Bank of Mexico Table 6.21: HOLDINGS OF FIXED INTEREST PAPER 1/ (In mwillions of pesos) Commiercial Investment Nacional Bank of Other Gov't. Insurance Bond Private and Total 3anks Banks Financiera Mexico Banks Cos. Houses Ehterprises 1960 10,254.6 1,618.8 648.9 427.9 1,03.1 51.9 816.5 75.2 5,572.3 1961 11,875.9 1,559.4 845.4 415.1 1,253.8 71.5 888.7 87.9 6,754.1 1962 13,702.3 1,629.h 1,079.0 394.2 926.4 112. 977.8 95.9 8,L87.2 1963 16,929.6 1,'301.1 1,481.8 599.t 1,208.6 157.7 1,104.1 107.2 10,969.7 1964 20,754.4 1,458.7 2,285.5 820.)4 1,209.1 147.6 1,278.6 109.1 13,65.4 1965 26, 570.9 1,500.1 2,818.3 1,095.4 1,178.5 240.2 1,447.1 125.2 18,166.1 1966 36,1L11.0 2,199.8 3,038.1 1,101.0 683.8 357.9 1,707.1 140.2 27,197.2 1967 47,1615.0 1,795.h 3,483.3 , 1,052.0 320.4 1,801.1 150.3 37,467.0 1968 56,65).6 1,804.6 3,624.14 1,131.6 983.1 201.9 2,037.7 149.0 46,722.3 1969 2 63,800.8 2,342.4 3,321.o 688.6 557.3 233.1 2,329.1 209.9 54,119.4 Source: Bank of Mexico 1/ Excludes securities issued by the Government. 2/ Preliminary. Table 6.22: ISSUE OF FIXED INTEREST RATE PAPER 1 (In millions of pesos) December December December C H A N G E 1967 1968 1969 2V 1968/177- 1 T9 68 T 0 T A L 47,165.0 56,654.6 63,800.8 9, 489.6 7,146.2 I. BANKS 39,3 40.24 48,733.0 55,9h8.2 9,392.6 7,215.2 1. GovTt.Credit Institutions 11,762.3 13,170.6 14,853.7 1,408.5 1,682.9 a) Nacional Financiera 7,563.0 8,477.8 9,684.2 914.8 1,206.,4 i) Financial Titles & Bonds 5,2428.0 6,342.8 7,9%9.2 9124.8 1,206,4 ii) Certif.ofParticipation 2,135.0 2,135.0 2,135.0 - - b) Other Gov't. Banks 4,199.3 4,693.0 5,169.5 493.7 476.-5 i) Mortgage Bonds 2,696.2 3,022.8 3,198.6 326.6 175.8 ii) Financial Bonds 993.4 970.2 920.9 - 23.2 -- 49.3 iii) Mortgage Particip.Bonds 503.5 700.0 1,050.0 196.5 350.-0 iv) Financial Certificates 6.2 - - 6.2 - 2. Private Credit Institutions 27,578.1 35,562.2 41,094-5 7,984.1 5,532.3 a) Mortgage Bonds 7,735.5 9,562.6 11,311.7 1,827.1 1,749.4 b) Financial Bonds 13,344.3 16,290.1 18,030.7 2,9945.8 1,740.6 c) Savings Bonds 1.1 1.0 - - C'.1 - 1.10 d) Certif.ofParticipation 23.1 23.1 23.1 - e) Financial Certificates 6,474.1 9,685.4 11,729.0 3,211.3 2,03.6 II. PRIVATE AND ENTERPRISES 7,824.6 7,921.6 7,852.6 97.0 - 69.0 1. Mortgage Bonds 2, 493.2 2,330.1 2,12.2 - 163.1 - 187.,9 2. Mortgage Obligations 5/ 5,331.4 5,591.5 5,710.4 260.1 118.9 Source: Bank of Mexico 1 Excludes securities issued by the Government. 2/ Preliminary I/ Including bonds issued by enterprises with state participation. Table 6.23: MAXIMUM AUTHORIZED ANNUAL YIELDS ON SELECTED BANK LIABILITIES BEFORE AND AFTER THE JUNE- JULY 1969 MEASURES 1/- (In per cent) Before After 1. Financieras Promissory notes (of Mex$1 million or more) In domestic currency 9.00 11.00 In foreign currency 8.00 10.00 Financial certificates of deposit (11 and 12 vears) -- 11.O and 12.00 Financi;fl hnnr7.q -n 2. Mreno Ennks Mortfanae bndi (ofP Mwrtl million orn mre) 8.0 11.00r SouirnpR 'Rank of Mpwion 1/ Net of tAy +rihholdinc. Table 6.24: FINANCING EXTENDED BY THE BANKING SYSTEM TO AGRICULTURE' AND LIVESTOCK (In millions of pesos) Private Banks Banco de Public Credit Year Total Subtotal Deposit and Financieras other Mexico Institutions (i) to (3) (1) Savings Institutions (2) (3) 1950 1,059.9 336.4 303.7 23.9 8.8 74. 649.1 1951 1,230.0 >497.1 >419.0 43.9 4.2 7>4.1 658.8 1952 1,507.1 521.7 468.1 4.3.8 9.8 196.8 788.6 1953 2,015.8 623.5 579.8 27.5 16.2 547.5 84h.8 1954 2,103.5 684.6 609.7 63.5 11. 4 57.0 1,361.9 1955 2,786.7 987.h 8147.3 131.2 8.9 98.3 1,701.0 1956 3,277.3 1,144.8 959.3 168.3 17.2 159.1 1,973.b 1957 3,561.h 1,219.3 985.9 216.0 17.i4 111.8 2,230.3 1958 3,998.8 1,289.9 1,018.7 253.0 18.2 104.4 2,604.5 1959 4,738.5 1,b52.6 1,110.0 328.0 1>4.6 111.9 3,174.0 1960 5,811.9 1,641.1 1,2115.5 38:2.0 13.6 241.1 3,929.7 1961 6,582.8 1,754.1 1,2140.7 496.8 16.9 370.0 [,458.4 1962 7,360.7 1,976.0 1,275.1 681.7 19.2 434.5 4,950.2 1963 8,237.0 2,283.0 1,560.6 706.3 16.:1 292.7 5,661.3 196h 9,317.9 2,8i1.1 1,979.2 841.6 20.3 336.8 6,10.0 1965 10,635.3 3,1714.9 2,121.9 1,o .7 52.3 260.7 7,199.7 1966 12,688.8 Li,08?.2 2,79.8 1,220.7 73.7 6.o 8,138.6 1967 1>4,025.6 3,870.0 2,682.2 1,105.7 82.1 1,18>.9 8,970.7 1968 15,355.9 JL,583.6 3,1:38.8 1,365.7 79.2 1,224.9 9,567.> 1969 16,188.0 >,827.9 3,368,>4 1,389.1 70., 749.8 10,610.3 1/ Does not include operations of the Government Trust Fund for Agriculture which is administered by Bank of Mexico. Source: Bank of Mexico. Table 6.25: INTERNATIONAL RESERVES OF THE BANK OF MEXIC0 (In million of U.S. dollars) 1967 9- 1 9 6 Dec. Mar. Jun. Sept. :Dec. Mar. Jun. Sept. Dec. Gold 166.1 155.1 165.2 165.0 165.0 165.2 166.5 168.6 168.6 Foreign exchange 325.1 329.9 290,4 285.7 358.8 360.3 378.5 306.0 364.8 In vault (å8.5) (15.6) (8.1) (15.9) (13.8) (12.5) (9.8) (11.8) (16.3) Deposits in U.S. banks (291.9) (219.0) (170.0) (178.9) (288.1) (238.5) (250.1) (136.8) (212.9) Other (1h.7) (95.3) (112.3) (90.9) (56.9) (109.3) (118.6) (152.4) (135.6) Securities 5. 10.2 .9-- -- -- 4h.h 16.5 Sub-total Ü-7ý. 490. -!'2 I .253. 5.' 545 519 -0 5~~~ IMF position 94.6 101.6 132.4 132.2 132.6 132.5 127.9 116.0 112. Payments agreements 23.6 19.3 28.4 29.1 26.3 37.3 45.7 22.1 29.6 Other reserve assets ?.0 75.0 75.0 75.0 75.0 75.0 - -- Total assets 66fT -W7.4 7017 692.9 77.7 770.3 718.6 ~6.- 692.0 Payments agreements, credit ~ - .2 -7.4 -10.0 -14.2 -12.1 -10.6 -11.1 -12.4 Net foreign reserve position 72.9 9 1.2 9.2 2.9 743.7 'ff ~ 700.0 3~7~ 6 Seasonally adjusted 632.6 667.3 704.1 709.1 722.5 742.6 715.9 671.5 662.3 Source: Bank of Mexico Table 6.26: INTERNATIONAL RESERVES OF THE BANK OF NEXICO (In millions of U.S. dollars) End Net Total Change of IF Foreign / Out- From Year Year Gold Position ./ Exchange-/ S.D.R. Securities' standing Earlier 1960 136.1 45.0 213.1 - 43.2 437.4 -20.5 1961 111.7 - 221.5 - 77.5 410.7 -26.7 1962 94.4 45.0 224.7 - 55.1 419.2 8.5 196 138.9 Lq.0 237.0 - 121.L L2.3 123.1 1964 169.0 45.0 263.0 - 109.0 586.9 44.6 IQ96 1E7-8 *4.q 300.6 - 21 .0 533.9 -53.0 1966 108.5 86.1 308.3 - 54.1 557.0 23.1 1QA7 I(5.7 34.0 C92.2 - - 62 Q 9.Q 1968 165.0 132.6 445.9 - - 743.5 90.6 1AQ 1AA March 155.1 101.7 419.0 - 5.5 681.3 125.7 Jne 14. o 12 7 3A8A - in9 6 1 Q9 9 Sept. 164.2 132.6 379.8 - '.9 682.9 97.1 n 16, / 13. 44 .9 - 73 C! on A March 165.2 133.0 460.5 - - 758.2 76.9 j W ~ .i...' I _LJ) I4.)~ -J -L -JU4 U Sept. 168.6 116.1 317.0 - 44.4 646.1 -36.8 nu~J 4PJ.~ 4 - -1 ') e3)L n -J - r.U. 4f7) D.7 lu U - LL4 u-.V--U.U(: March 170.6 113.0 351.8 47.4 45.3 680.7 51 -77.5 Source: Bank of Mexico 3/ Gold tranche position plus net drawings of Mexican pesos. .i/ Including net payments agreements balances and net balance of swap operations with U.S. Treasury. 3 Mainly U.S. Treasury bills ana Lkw bonds. /Gold is revalued at US$35.00 per ounce since this date. / Excluding SDR (47.4) Tn'hlp A-97- pER,T.gTp.-pn ~'(rr.y 'R.1Yr.qA-KTrp. TPAKTqAr.TTr),KT IQonl-()c 1960 1966 1967 1968 1969 Assets with Variable Income 159.0 1,411.4 1,330.7 1,584.7 1,297.4 Industrial Stocks 147.5 1,129.5 1,028.8 1,296.8 1,086.3 Stocks of the Mining Suect o u uommerce - r'-.o .Oo .1 Stocks of Banking insurance and Other Financing Insuitbutions 11L.5 26. 493 25.7. Assets with Fixed income 4,944.7 2, 1.3 L1'uy.4 o UY4 z .uo ,_u.y Rublic 2,253.1 3,126.6 3,839.9 6,915.6 7,565.9 Private 2,691.6 13,524.7 17,369.5 19,456.4 26,345.0 Total 5,103,7 23,062.7 22,540.1 27,956.7 35,208.3 Source: Bank of Mexico Tabla 6.2hs SrRUCTURE OF RESEVE REQUIREMEWS OF THE BANIN3 SYST1EM (in percent of liabilities specified) Demand and Time De oaita Sa v:L, DeLiablties of =nBMt Curra noreig 3Urn n D ti&Fo. urIn Dometic urren In For. Cur. Mortgage Banks - o r c Y ~ ur !o~r ~ ~ B ~ ~ E IFu ri1~T~o o U Dcmestic: CurrLVc red. other 12119 or 142C@2 QO CircuLlar Dist. Areas 1470/1 1591/2 1/ 'II/L 1310 I5 II/6 I/1 11/8 1350 P.2 P.2P 1470 544 1553 A B 1665 •111 I1 12 1188 Totgl R2Aervj& _0 100 100 100 100 1C0 100 10 100 100 1000 1 1_ 100 100 10 100 100 100 100 100 100 100 100 Cash Reserv,z b/ MinimumDpoeit with Banc of M ico 15 1 10 10 20 10 10 10 Security Rcesrvil ~ 0 - 1 11 Indu urity 37.5 10 13 Public Sector Security at& 98 - - - 50 - - - - - - - - 50 70 70 - - - 8% 28 8 - - - - - - - - - -19 20 25 50 49 20 20 - - 3 6 5 - - - - - - - - 37.5/L 10 2- - - - - - - - 5 7 2 20 - 90:- L.5% - - - - - 91- -- 3 9 - - - - - 5 55 - 37.5 - - - - - - - -75- Relending of Rserve E -ff etJe n reserve 60-70 60-70 L - q renente / 210 2 ;1 80 1 LO 20 20 20 L0 20 2 0 40-30 L 20 100 Directive620 - 5 _-_ 80 6 _- - 5 - ediu-am TCrodita/ -- - - - 3 5- - - - - Agricultural Credits - 25 - - - - - - - - - - - - - - - - - - - - - Credit5 for Approved Operations 20 20 - - o - - - - - - - h0 80 - 75 40 - - - - - - Production Credits 5 - 25 20 - - - - - - - - - 25 - . - - - - - Credita for Consumption Goode - - 25 - - - - - - - - - - 25 - - - - - - - - Credits for Exporte of inufacture - - - - - - 20 - - - - - - - - - - - - 5 - - Short-term Credits - - - - - - - - 10 - - - . - . - . - - - . - - Commercial Credits - - - - - - - - - - - - - - - - - - - - - Soal Housing Credit - - - - - - - - - - 50 30 - - - - - - - - - - - - Fre Res,ourcee - - - _~ 6j- 97 /1 Applien to: (a) Time Deposits of comercial banks over specLfied amounta and of /8 On additional deposita exceeding 150% of the June 1, 1963 level. more than 90 daya which pay no mora than 6%. Above the May L, 1960 level. (b) Time Depositö of investment banks over speciried mounte and of /10 Above the October 31, 1966 level. mora than 180 daye dnich paU no more than 7%. /11 Above the Maroh 5, 1959 level. /2 On additional deposita or above November 19, 1966 level. /7 Above the March 5, 1959 level. On eJanuary 8, 1955 level. For foreign monay with annual return of 3%. Abov January 8, 1955 lavel.1 Also including credits for approved operations. On up to 36% above the Aurust 31, 1955 level. 7i Up to 6.5% also "Caja" and "Bancos del Pails". On additional deposits exceeding 136 of the August 31, 1955 level. 7 Up to 9% alsc "Bancos del Pais" or "Bancos del extranjero". On up to 50% above the June 1, 1963 level. a According to regulations as stated in the respective "Circulars" iasued by the Bank of Mexico. b,, Non-interest bearing deposits at Bank of Mexioo, cI Percentage re-lent to banks by Bank of Mexico against reserve requirements. Excludes the amount re-lent by Bank of Mexico flroM cash and sacurity reserve depositi made a,gairet rerVe requirelnnts. e Grecits for specifled acti,vitiles Source: Bark of Mexico fable 7.1: AGRICIJLTUaAL ?ODDUCTION, 1960-1969 (8 croos, volume in metric tons) 1960 196i 1962 1963 1964 1963 1966 1967 1968 19691- Barley 180,37 174,132 151 ,11 185,616 170,564 192,789 1911,203 174,800 180,000 200,803 Beans 851,200 9114,80D 97L,L00 975,000 978,400 1,091,200 1,067,000 1,022,400 1,001,600 987,500 Banana (Roaton) 317,261 340,875 353,it00 l3,283 421, L52 425,730 434,700 "ho,630 l448,990 462,000 Banana (Diverse) 296,255 305,786 313,760 526, 657 527, 316 534,215 542, 900 515,012 551,02o0 562,500 Chick-Peas 114,658 1?5,056 129,108 97,166 123,799 124,426 138,377 133,331 135,000 156,1429 Chili (Dry) 16,805 17,177 17,908 18,35h 20,633 214,266 21,14 21,L50 22,260 25,906 Chili (Green) 90,492 96,798 92,950 122,701 133,619 134,53 137,275 138,775 121,900 252,567 Cotton (Lint) 70,347 49,730 526,689 535,340 565,349 618,189 533,983 453,444 555,100 389,319 Corn 6,562,000 6,320,60 6,0o41,700 6,787,100 8,4524,046 8,678,083 9,038,10 9,033,600 9,126,300 5,311,300 Coffee 124,285 126,555 114,180 137,069 1Us,791 159,000 18:,000 172,000 171,900 180,000 Cocoa 23,736 26,938 27,150 30,067 20,100 20,600 214,500 25,200 26,676 28,200 Garlic 14,156 14,219 16,485 16,852 16,242 16,543 16,965 17,580 18,228 32,240 Green Peas 12,245 12,258 12,791 13,340 12,0149 114,296 114,775 15,3h5 16,000 23,438 Green Alfalfa 4,240,381 4,230,096 h,150,996 5,132,074 5,511,878 5,575,500 5,7214,000 5,761,350 6,050,000 7,500,000 Henequen 155,761 156,005 157,500 171,681 195,444 175,000 176,000 147,200 147,730 150,400 Linseed 15,299 114,965 14,955 13,699 126,095 114,793 10,368 7,218 7,350 12,192 Melons 80,728 914,667 186,691, 193,500 188,475 256,677 210,567 211,200 235,750 264,000 Oats 67,566 68,195 74,287 78,766 79,84b4 19,655 26,262 28,960 30,000 40,983 Oranges 766,h71 772,?82 882,5211 8:54,844 8L,5,108 863,729 880,000 882,200 892,440 937,250 Onions 60,859 63,95:2 81,761 1024,000 118,800 1214,100 107,950 111,533 115,200 135,043 Peanuts 89,321! 93,684 92,789 92,831 95,396 80,118 89,917 92,025 97,650 72,636 Potatoes 294,118 303,511 i4,600 613,955 413,206 297,55 29L,036 377,858 400,000 2448,102 Rice 327,512 332,944 288,973 196,373 272,630 377,528 372,187 429,560 45h,580 452,611 Sugar Cane 12,851,60% 19,166,980 19,967,100 22,126,992 26,989,608 23,079,286 27,139,597 30,233,000 28,81j6,000 31,990,000 Sesame 129,227 146,826 157,489 169,268 171,697 162,009 187,106 201,640 215,000 200,631 Soybeans 8, 406 57,902 56,721 56,258 60,267 60,147 93,853 102,936 111,600 111,165 Sorghum 209,265 290,6UL 295,920 402,183 525,55h 884,463 1,399,940 1,241,845 1,700,000 2,405,087 Tomatoes 388,6L8 1453,125 433,819 1463,550 4,971 523,847 496,632 578,732 620,000 756,116 Tobacco 72,035 66,922 70,200 67,581 67,767 56,979 56,499 61,294 62,000 72,225 ldheat 1,189,979 1,1401,910 1,455,256 1,7136,182 1,8M6,117 1,608,888 1,691,810 2,101,096 1,954,737 2,457,802 Watermelon 133,5CO 198,h07 337,211 31.7,200 339,994 363,150 385,250 390,390 420,000 461,500 Arvejon 5,666 - - - 5,066 5,123 5,220 5,366 5,550 L,355 Beans (Habat) 19,79 - - - 37,103 37,859 38,637 39,360 40,013 28,089 Beet 55,632 - - - 45,b20 46,771 48,300 50,400 52,500 39,177 Cotton Seed - - - - 932,192 1,017,102 952,569 772,785 946,031 663,498 Canary Seed - - - - 3,029 3,095 838 3,264 3,322 14,334 Copra 739,2L,5 - - - 167,5h5 168,450 170,000 170,200 172,000 173,000 Cartamo - - - - L7,150 71,766 123,054 140,2400 143,249 Egiplant - - - - 3,903 4,556 8,872 5,052 5,525 7,776 Ejote - - - - 10,113 10,143 10,676 11,040 11,550 17,210 Fig 1,613 - - - 7,968 5,293 14,602 L,795 3,854 4,452 Lentil 1,715 - - - ,15-, 5,438 3,544 5,580 5,670 3,822 Pineapole 154,081 - - - 197,759 233,096 231,465 251,073 262,500 301,913 Root 4,68 - - - 1!,558 34,576 35,155 36,000 16,800 27,516 Sweet Potatoes 50,57L - - - 129,148 112,057 1247,039 162,421 171,500 171,500 Strawberry 16,069 - - - 71,686 82,201 1245,894 62,69 72,000 86,688 Tomatoes (Cascara) 28,217 - - - 19,021 19,?140 19,608 20,020 20,280 48,981 Vanilla - - - - QO 914 9 100 105 86 /I Preliminary. (-) * signifies non-availability of data. Source: inuarlo Es c ft,irIio dc los t,addor Unidor M l: and MiFsion estimates. Table 7.2: FISHERIES PRODUCTION BY PRINCIPAL SPECIES, 1960-1969 (Volujme in tons) 196Y-19 196 196 1965 1966 1967 196 -1969 Shrimp (Headless, Head On and Dry) 39,593 42,895 42,141 h3,115 hl,271 35,232 39,351 h2,3h8 36,061 33,680 Oyster (With and Without Shell) 17,219 17,395 16,698 17,687 20,h09 22,818 19,863 203166 24,48 32,418 Sardine 17,088 19,988 1h,8).3 19,337 -19,068 20,361 418,668 2,hB7 27,889 30,023 Mackrel 4,1L2 3,888 4,012 3,819 3,984 h,6h8 5,200 5,962 7,056 6,469 Snapper 1,309 1,626 2,203 2,736 3,031 3,969 3,930 5,138 6,130 5,189 Turtle 1,oo8 1,152 1,233 896 1,745 1,973 3,111 i0,3U5 1,574 5,09 Anchovy 19 97 868 1,497 5,378 9,624 13,748 22,755 15,882 4,079 Mullet 2,558 2,001 1,710 1,803 2,439 2,501 3,2,0 3,252 4,095 3,881 Cichlids (Mojarra) 1,375 1,382 1,398 1,671 1,878 1,744 1,958 2,000 2,507 2,927 Shark 822 795 907 1,268 1,672 1,506 2,190 2,540 2,843 2,587 Bass 2,453 2,554 2,963 2,835 3,275 2,796 2,788 2,736 2,832 2,566 Lobster 710 1,037 9,54 1,055 1,093 1,098 1,316 1,280 1,337 1,364 Headless Croaker (Totoaba) 721 694 1,085 987 645 804 1,124 830 776 487 Source: Secretaria de Industria y Comercio; Mission estimates. Table 7.3: EXPENDITURES OF THE FEDERAL GOVERNNENT IN INFRASTRUCTURE FOR AGRICULTURE 1C 19 9 1970 Millions Millions Millions Millions Millions of Pesos % of Pesos % of Pesos % of Pesos % of Pesos , Irrigation 1,h3.9 72.4 1,558.4 72.7 2,070. 78.4 2,224.1 76.6 2,182.4 61.9 Agricultural Development 234.1 11.7 227.6 10.6 219.0 8.3 190.3 6.5 687.2 19.5 Livestock Development 72.9 3.7 69.6 3.2 86.7 3.3 92.7 3.2 94.5 2.7 Poultry Development 13.5 0.7 12.8 0.6 13.7 0.5 9.8 0.3 15.5 0.5 Forestry Development 26.5 1.3 38.3 1.8 35.3 1.3 43.2 1.5 3.5 1.2 Agricultural Colonization and Resettlement 99.h 5.0 106.0 4.9 103.3 3.9 122.0 4.2 114.6 3.2 Other Investment o.7 5.2 130.9 6.2 111.5 4.3 222.4 7.7 388.0 11.0 TOTAL 1,995.0 100.0 2,113.6 100.0 2,639.9 100.0 2,904.5 100.0 3, 25.5 100.0 Source: Presupuesto de Egresos de la Federacicn. Table 7.4: AREAS BENEFITING FROM FEDERAL GOVERNMENT INVESTMENT IN SMALL AND LARGE SCALE IRRIGATION (Areas in thousands of hectares) New/1 Improvement/2 Total 1965 35.9 3.2 39.1 1966 51.0 9.8 62.8 1967 5o.9 6.3 57.2 1968 71.0 26.3 99.3 1969/3 70.9 34.5 105.4 IoAC lAC-IoAQ /1 9R 7 Ar 1 IAAA 1926-1969/3 1,815.8 988.3 2,804.1 /1 Areas that did not previously have irrigation. /2 Areas in which the works contributed to augmenting or- 1trgulatingr thIZ sUPP-Ly o.f water. Source: Secretaria oe RecursoI n±uraulnue-, Iior-Ie de Labores, 1969. Table 7.5: SMALL IRRIGATION WDRKS, 1959-1969 HecEtar ('000) Investments (Thousands of pesos Copartic- Internal New-- imprved.- Total S.R.H. Lpions Credits I.D.B. Total 1959-1964 - - 109.7 337,4oo 62,545 - - 399,945 1965 7.0 2.9 9.9 74,137 13,546 - - 87,683 1966 10.1 3.3 13.4 108,079 7,540 - - 115,619 1967 5.9 2.h 8.3 102,185 11,h66 - - 113,651 1968 15.8 2.7 18.5 200,183 12,042 - - 212,225 1969/2 33.5 3.4 36.9 189,850 5,000 14,100 184,750 393,700 1965-1969/2 72.3 14.7 87.0 674,434 49,594 14,100 184,750 922,878 /1 See notes 1 and 2 on Table /2 Prelmninary. Source: Secretarfa de Recursos Hidräulicos. Informe de Labores, 1969. Table 7.6: MEXICO - AGRICULTURAL SUPPORT PRICES, 1960-1969 1- -en no, +,..n Year Corn Beans hbeat Sorghum Sesame Rice Soya 1960 800 1,750 913/800 565/525 - 900 - 1961 800 1,750 913/800 565/550 - 900 - 1962 940/800 1,750 913/800 625/550 - 900 - 1963 9h0/800 1,750 913/800 625 - 1,050/900 - 1964 940/800 1,750 913/800 625 - - - 1965 940/800 1,750 913/800 625 - - - 1966 940/800 1,750 913/800 625 2,600/2,500 - 1,600 1967 940/800 1,750 913/800 625 2,600/2,500 - 1,600 1968 940/800 1,750 913/800 625 2,600/2,500 - 1,600 1969 940/800 1,750 913/800 625 2,600/2,500 - 1,600 Note: Where two prices appear, the lower one refers to irrigation districts, the higher to rainfed land. Source: CONASUPO and Bank of Mexico. Table 8.1: INDUSTRIAL PRODUCTION VOLUCf INDEX (1960=100) Manufactured Chemical Textiles Wbod prod. Food- Cloth- prod. rubber Non- Petro- stuffs ing & furniture & metal Basic Metal Cons- Gen. leum & bever. leather paper-& plastic mineral metal prod. & truc- ELectric Year index Mining petrochmn. Total tobacco prod. printing prod. prod. prod. repair tion power 1961 105.0 95.9 110.9 105.7 107.0 101.2 102.9 102.8 97.6 105.9 113.7 99.5 108.9 1962 110.2 102.6 ,14.3 110.6 l1o.4 105.8 112.6 l1h.4 110.9 108.9 113.9 106.0 117.4 1963 120.7 105.1 121.2 121.0 119.1 109.1 121.7 12h.0 115.1 129.0 135.9 121.4 136.3 1964 138.8 107.8 134.2 140.1 129.0 133.6 1W2.6 139.7 133.5 150.2 175.0 141.9 159.4 1965 12.L 107.7 1.2.8 152.2 137.5 1i.9 156.8 156.6 116.6 162.3 196.9 139.8 176.1 1966 162.2 111.4 lo.9 166.3 146.7 149.2 164.2 173.8 170.8 18.1 228.0 159.9 195.8 1967 175.1 114.6 169.1 177.0 153.9 167.3 171.7 188.4 191.3 195.8 235.4 188.7 217.7 1968 191.3 121.6 183.8 196.3 165.1 179.5 181.9 212.2 215.7 216.9 271.2 194.0 241.8 1969 207.6 128.7 194.7 211.0 176.7 191.0 203.0 244.1 216.1 234. h 289.6 212.-0 275.1 1/ Preliminary figures Sources Bank of Mexico, S.A. Table 8.2: STRUCTURE OF INDUSTRY, 1968 No. of Man- Hours Worked Value Gross Total Production No. of Monthly of Gross Production Annual Per Man Estab- No. of Average Production Per Estab- Salary Hour Branch of Industry lishments &plyees ('000) 000 Pesos) lishment 000 Pesos) Pesoal Packing, Conservation & Preparation of Meat Products 62 4,437 736 1,312,I00 21,168 72,634 149 Condensed 4 Powdered Milk 11 2,369 155 1,258,657 96,820 79,554 256 Packing Fruits & Vegetables 41 8,709 1,083 726,063 17,7 9 129,643 56 Packing & Conservation of Fish & Shellfi sh 16 6,135 795 547,281 15,202 83,213 57 Orinded Wheat 119 5,103 723 1,953,699 16,418 106,597 225 Chewing Gum 1 1,448 19h4 292,693 97,564 37,451 126 Biscuits & Cookies 314 8,097 1,235 866,897 25,497 151,319 59 Malt Yeast & Powder 23 3,169 478 1,000,983 43,521 112,461 174 Vegetable Oil & Margarine 71 7,532 1,024 3,328,574 46,881 180,866 271 Food Products for Animals 3 2,774 331 1,626,359 37,822 64,921 409 Beer, Ale 18 11,944 1,686 3,028,786 168,266 477,515 150 Cigars 13 6,098 714 2,197,061 169,005 214,451 256 Artificial Fiber 51 11,636 1,883 1,720,136 33,728 283,454 76 Fiber & Wooden Triplay 18 4,448 750 413,243 22,958 82,205 145 Cellulose & Paper Paste 141 13,879 2,314 2,602,153 63,467 450,583 94 Cartons 29 2,h02 403 361,1497 12,465 58,843 75 Rims & Cameras 5 5,941 711 1,878,386 375,677 318,298 220 Synthetic Fiber 10 8,039 1,224 1,530,998 153,100 253,361 104 Fertiliser 16 3,675 591 1,138,948 71,184 122,130 161 Soap, Detergents, etc. 51 6,363 823 1,965,413 38,538 2211,138 199 Wax & Phosphorous Matches 23 1,56 263 208,684 9,073 73,043 66 Insecticides 30 1,489 159 338,348 11,278 45,537 177 Coke & Other Carbon Minerals 4 859 170 374,974 93,744 33,306 183 Glass & Other Primary Caass Manufacture 2 1,818 287 308,599 154,300 72,494 90 Glass Bottles, Tubes, etc. 15 12,300 2,087 1,037,013 69,134 327,955 1 Other Glass Products Except Opticals 8 1,200 180 109,193 13,6945 28,687 51 Cement 26 7,510 1,272 1,508,625 58,02L 268,404 99 "rimary Iron & Steel Lamination 28 12,687 2,210 3,825,776 136,635 391,157 1414 Secondary Iron & Steel Lamination I1l 21,1P2 1,602 6,581,812 160,512 739,201 152 Iron & Steel Tubes 19 5,583 - - - 1914,408 - Aluminium Lam.1-nation 9 2,775 427 559,,423 62,158 89,1477 109 Automobile Assembly 16 20,808 2,5544 6,067,983 379,249 799,254 199 Auto Repair Shops 17 2,815 16 221,079 13,005 66,879 142 TO TAL 935 216,988 31,69 0 50,891,744 267,771. 6,60Y,039 55 Source: Centro de Estudios del Sector Privado, A.C. Table 8.3: MINERAL PRODUCTION, 1960-1969 (Volume in tons) 1960 1961 1962 1961 1964 1965 1966 1967 1968 1 9691 Metallic Gold/2 9,339 8,357 7,36h 7,401 6,531 6,71.2 6,64 5,141 5,504 5,618 Silver 1,385 1,255 1,282 1,330 1,298 1,254 1,306 1,190 1,265 1,3h0 Copper 60,330 49,314 47,125 55,861 52,506 69,162 74,396 56,012 61,110 66,764 Lead 190,670 181,326 193,298 189,987 174,824 170,092 182,071 163,907 174,169 170,815 Zine 262,425 268,973 250,683 239,818 235,603 224,876 219,180 241,215 240,021 252,097 Antimony 4,231 3,609 4,769 4,826 4,788 h,h67 4h78 3,738 3,464 3,218 Mercury 693 624 650 562 433 662 761 h97 593 826 Arsenic 12,131 12,281 10,903 9,h86 11,169 10,128 11,894 11,336 10,248 6,052 Tin 371 539 585 1,072 1,226 511 802 597 528 512 Tungsten 110 105 48 20 5 110 86 188 266 263 Manganese 71,856 68,704 62,869 54,31 64,089 58,810 31,099 30,799 26,706 54,639 Bismuth 272 1,064 356 427 472 h84 454 5o 525 607 Cadmium 1,181 776 608 724 748 725 812 1,246 1,194 1,567 Iron 521,356 687,000 1,353,622 1,396,882 1,392,h67 1,592,736 1,480,509 1,617,096 1,921,299 2,145,902 Non-Metallic Carbon 1,771,000 1,818,000 1,893,00) 2,071,000 2,138,000 2,005,662 2,101,187 2,386,406 2,605,370 2,458,000 Graphite 34,316 18,004 29,023 29,996 30,337 40,41 38,752 4o,69o 52,694 39,80 Sulphur 1,336,168 1,242,794 1,442,517 1,553,462 l,733,041 1,5131,268 1,701,060 1,891,155 1,684,948 1,717, 322 Flourite 366,945 398,514 502,257 h81,619 642,872 735,381 726,397 784,896 938,670 1,001,039 Barium 270,757 248,708 318,138 256,59 4 334,044 368,3142 291,584 223,28) 246,539 179,960 'l Preliminary. /2 Volume in kilograns. Source: Anuario Estadistico Compendiado, 1966, Revista De Estadistica, Mexico, 1968 and Mission estimates. Table 8.: PE£ROLhUM PRODUCTS, 1960-1969 (Volume in '030 m 1991962 163 1969 TOTAL PROCESSED PRODUCTS 15,928 17,75 1764 18,098 18,99 195 20,580 22294 3517 23 6 Gases 813 1,034 961 1,151 1,306 1,ý621 1,796 1,455 1,761 1,625 Refined Gasoline 4 289 4 757 4 727 5 14 5 548 5839 ._702 6, 621 7 096 7 481 Mexolina '77) 32 ) (6v) 4ff (4O1) 1r37) t) 6 ~42) ~Ì757) Supermexolina (3,043) (3,333) (3,123) (3,259) (3,509) (3,574) (3,262) (3,879) (3,963) (4,149) Gasolrmex (262) (548) (718) (959) (1,28,4) (1,474) (1,4147) (1,726) (1,966) (2,191) Prernium (-) () (91) (124) (189) (172) (399) (428) (593) (528) Gasaviones (66) (109) (102) (103) (110) (126) (101) (102) (83) (88) SolventeE (27) (28) (30) (35) (40) (42) (148) (46) (49) (54) Others (104) (137) (22) (24) (15) (14) (14) (14) (16) (14) Refined Kerosine 1 718 1 865 1 857 1 880 1 947 1 874 (2 037) (2 234) (2 229) (2 267) Týractogas ~:L7 "-Tti ~)77 1‡77 "N9 ~ÌT) T[) E)9) ~ÝT) Tractomex (127) (137) (122) (132) (138) (134) (132) (142) (151) (155) Transparerit (1,373) (1,466) (1,469) (1, 468) (1,498) (1,1423) (1,510) (1,630) (1,582) (1,545) Turbosina (45) (84) (93) (125) (152) (171) (255) (315) (357) (426) Diesel Oil 1,895 2,030 2,358 2,597 3,166 3,167 3, 405 3,775 4,224 4,385 Combustibles and Residue 6,668 7,51a 7,184 6,759 6,352 6,658 6,410 6,904 6,845 6,858 Asphalt 302 283 327 319 369 504 959 1,000 1,088 989 Lubricants 168 178 175 :187 195 217 207 233 212 218 Grease 4 5 6 7 7 7 6 8 9 8 Paraf fin 51 52 49 53 59 58 58 64 53 65 Source: Anuario Estadistico de los lstados Unidos Mexicanos and Mission estiiates. Tnhle RA. RASTC P ATmrnMNTrAT. PRODCTTON. 196h.-1969 (Volume in tons) _______ 16L 1965 1966 o 1967 1068 19oAo/ Sul-hur 16.866 h6.722 1h.526 h8.138 51.0AL 57.910 Alkilarilo (Light) 6,591 10,203 12,039 15,168 15,797 8,983 Alkilarilo (Heavy) 4,646 5,820 7,870 9,765 10,209 7,L90 Polietileno - - 5,715 16,377 22,706 27,127 A.mmonia 124,292 121,111 139,823 132,370 163,168 390,651 Dodecil Benzene 26,080 16,453 41,650 49,539 45,905 4L,943 Carbon Anhydride 148,815 146,577 171,194 162,886 254,571 57,949 Tetramero 163 116 21 48,220 47,720 h,126 Tol uene 14,8111 64,950 92,200 101,324 112,662 112,002 XvI.ne/2 7-77q IPR8 308RA - - - Heavy Aromatics 692 5,678 17,009 29.969 61.282 57,766 Heptane 134 3,265 2,765 1,637 4,116 L,2L1 Hfxane 782 5,522 8,879 11,557 1h,088 17,92h Orthoxylene 61 5,282 9,63 15,458 16,789 15,99" Meta and Paraxileno 216 19,115 34,331 49,691 56,871 52,b20 Ethyl Benzene - 3,096 6,427 9,358 12,821 1,11L /1 rreiiminary. '2 F-,Ues from 10O,7196 to 169n ava1.lae Source: Anuario EstadIstico de los Estados Unidos Mexicanos and Mission estimates. _L 2- a0 £ 1Md% T-QX9i n4 fl I n4 I ULJ_Lt: U . V; %'JU IN L Oln _L7v% _ J' -Not including border areas- Number of Per Capita Year To a sM ExpenuiureL4 ExpendituresL5 1960 787 155.3 197 1961 859 164.0 191 1962 958 178.6 186 1963 1,081 210.6 195 1964 1,239 240.7 194 1965 1,395 274.9 197 1966 1,546 528.4 212 1967 1,674 363.1 217 1968 1,937 431.9 223 1969 2,137 465.2 218 19704 2,357 514.0 218 l Includes Mexican Nationals residing abroad. /2 Millions of dollars. ,L Dollars. A4 Estimate. Source: Ministry of Industry and Commerce, Bank of Mexico. Table 8.7: PRIMARY SCHOOL ATTRITION RATES, 1966-1967 Percent Dropouts Percent Dropouts Dul r~ J± in y Rnd of Grade School Year School Year 1 10.3 31.6/1 2 7.6 8.5/2 1 7.7 12.1 h 7.6 8.1 5 7.6 5.2 6 5.9 - Percent of Entrants into First Grad Finishing &tering Grade School Year Next Grade 1 90.6 68.9 2 64.0 59.0 54.8 48.9 45.4 42.0 39.1 37.1 6 35.1 - /1 Urban rate 8.5 percent, rural rate 62.h percent. /2 Rural rate 25 percent. /3 Only 65' of potential entrants ever enter, thus of school age population only 23% ever finish primary school. Source: Anuario Estadistico.  TALE 9.tl: PRIE INDEXES IN MEICO CITY loO- 10Q (Annual Average, 1954-100) Wholesale Prices Cost of Living General Year I n3_& (210 Goods Goods (16 Commodities) 1950 72.5 73.4 71.2 70.5 1951 89.9 91.3 87.9 90.9 1952 93.2 96.1 89.1 99.5 1953 91.4 93.5 88.7 93.2 1954 100.0 100.0 100.0 100.0 1955 113.6 114.2 112.1 118.0 1956 118.9 120.8 116.0 122.9 1957 124.0 126.6 120.5 129.1 1958 129.5 133.7 123.8 142.9 1959 131.0 114.7 126.0 147.8 1960 137.5 139.8 134.3 151.7 1961 138.8 141.1 135.6 157.1 1962 141.3 145.6 135.4 157.2 1963 142.1 145.2 137.8 156.6 1964 148.1 151.9 143.0 163.8 1965 150.9 155.4 144.6 166.5 1966 152.8 158.4 145.1 172.8 1967 157.2 164.4 147.2 177.2 1968 160.2 168.1 149.3 182.8 1969 164.3 172.9 152.3 185.5 Annual Changes (%) 1960 5.0 3.8 6.6 2.6 1961 0.9 0.9 1.0 3.6 1962 1.8 3.2 -0.1 0.1 1963 0.6 -0.3 1.8 -0.4 1964 4.2 4.6 3.8 4.6 1965 1.9 2.3 1.1 1.6 1966 1.3 1.9 0.3 3.8 1967 2.9 3.8 1.4 2.5 1968 1.9 2.3 1.4 3.2 1969 2.6 2.9 2.0 1.5 N-jualr; Bar.1k ofL Mex±ico. Table 9.2: ESTIMATED WAGE PAYMENTS BY SECTOR AND WAGE SHARE OF GNPL, 1960-1969 (Millions of pesos, 1950 constant prices) 71960 - 1961 192 1963-- 19-1965 - 71966- 1967 7 1961969 Agriculture 3,190 i,281 3,454 3,527 3,758 3,931 L,024 4,115 4,27h h,330 Mining 575 551 558 7 583 578 593 599 615 656 Petroleum 686 765 779 827 902 9h0 971 1,081 1,148 1,221 Manufacturing 6,757 6,998 7,47 8,132 9,287 9,950 11,050 11,960 13,032 13,875 Construction 1,613 1,629 1,647 1,906 2,219 2,181 2,508 2,791 3,0i2 3,325 Electricity 459 $03 535 586 674 738 814 897 973 1,13L Commerce 1,917 1,978 2,077 2,208 2,446 2,581 2,787 2,965 9,188 3,475 'Transport 2,35 2,371 2,376 2,1478 2,631 2,760 2,878 3,022 3,188 3,465 Services 3,685 3,858 4,070 4,321 4,656 4,908 5,311 5,702 6,139 6,520 Government 1,985 2,129 2,274 2,382 2,62CI 2,725 2,891 3,036 3,233 3,4440 Total Wages 23,221 24,063 25,207 26,945 29,776 31,292 33,827 36,168 38,832 41, 439 Total GNP/2 73,482 76,038 79,691 84,700 93,200 98,200 105,600 112,400 120,40o 129,100 Wage Share (%) 31.60 31.66 31.63 31.81 31.95 31.87 32.03 32.18 32.25 32.10 /1 Based on Input-output table of Bank of Mexico. Wages do not include subsistence earnings or profits of unincorporated enterprises. Old series. Source: Bank of Mexico and Mission estimates.