Mexico's government announced in September that it expects the country's Gross Domestic Product (GDP) to grow by at least 3.5% next year. The Mexican finance ministry also announced that it expects to see an inflation rate of only 3% and a median oil price of $84.90 per barrel in 2012. In addition,the country's current budget bill calls for a federal budget deficit that totals 2.2 percent of the country's GDP in 2012.
Much of this estimated deficit is due to a planned investment by Petroleos Mexicanos,which is a state-owned oil giant that uses revenues to fund at least 30% of the federal government's budget. Currently oil production is estimated to hit 2.55 million barrels per day (BPD) in 2012,while exports are projected to be at around 1.16 million BPD.
“Mexico needs to keep growing and distance itself from fiscal crises in other countries,” said finance minister Ernesto Cordero,who also called the proposed 2012 budget “prudent and responsible” at a recent press conference. In addition,Cordero stated that Mexico is dedicated to “facing internal economic challenges and protecting the Mexican economy from international turmoil.
Cordero noted the fragile state of the global economic environment,which he said stems largely from financial problems in some of the world's top industrialized nations. The 2012 budget in Mexico aims to maintain economic and fiscal stability while accelerating the growth of the domestic market and stimulating the economy,all while improving the standard of living for everyone.
He added that the majority of budgetary spending in 2012 will aim to bolster the country's economic growth while encouraging continued social development and improving public safety. To accomplish this,the budget proposes additional spending to prevent and dismantle organized grime and gangs,which have been the cause of negative press for Mexico in recent years,despite the fact that most of the violence is very isolated and even predictable.