The Balance of Stabilization Funds in Mexico Decreased

The balance of stabilization funds in Mexico decreased according to official sources from the Ministry of Finance.

Stabilization funds in Mexico come from the FEIP, FEIEF, and FMP, and they experienced a decrease to 303,947 million pesos during this presidential term.

The resources of the stabilization funds in Mexico totaled 388,771 million pesos at the end of 2018 and 84,039 million pesos in September of this year, implying a contraction of 82.7% in real terms.

The balance of the Fund for Stabilization of Budgetary Revenues (FEIP) fell by 240,287 million pesos at the end of the third quarter of 2023, compared to the amount of resources it had at the beginning of the administration.

At the end of 2018, it had 279,771 million pesos, and by the end of September this year, it had decreased to 39,484 million pesos. In this regard, it accumulated a real drop of 88.8 percent.

Meanwhile, the Fund for Stabilization of Revenues of the Federal Entities (FEIEF) decreased by 65,197 million pesos in the first four years of the current administration.

The balance dropped from 88,722 million pesos to 23,525 million pesos, which represents a real drop of 79%.

Stabilization Funds in Mexico

José Luis Clavellina, director of research at the Center for Economic and Budgetary Research (CIEP), stated that stabilization funds in Mexico are created to be used when there is indeed a crisis or a lower collection of income.

According to the CIEP, the funds were used in 2019 and 2020, but they have not been fully replenished. In this regard, Mexico would not have sufficient resources to face a new economic crisis of that magnitude.

He pointed out that the reduction in stabilization funds in Mexico was not due to a deliberate practice by the government to eliminate them but because it was necessary to spend them due to the economic crisis caused by the pandemic.

He added that, with the 2024 Revenue Law, the Ministry of Finance announced that they had approved some modifications to the FEIP so that the government can capitalize it with financial assets from the public sector, and perhaps that will also help accumulate more funds more quickly.

The balance of the Mexican Oil Fund increased by 1,567 million pesos, going from 20,278 million pesos at the end of 2018 to 21,815 million pesos this year.

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