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MEXICO COUNTRY STRATEGY UPDATE 1.
Period of coverage The Country Strategy with Mexico covered the period 2002-2006 (document GN-2181-1) and was updated in 2008 through document GN-2477. The Bank is in the process of preparing a new Country Strategy with Mexico, which will be presented to the Programming Committee in September 2010 for consideration. The present CS Update covers the period January 2009 to September 2010.
2.
Approvals during the effective period of the CS Update and their consistency with the areas of the CS The 2002-2006 Country Strategy with Mexico calls for actions in four areas: (i) social sector and poverty reduction; (ii) integration; (iii) modernization of the State and decentralization; and (iv) eliminating barriers to the competitiveness of the private sector. The operations approved during the period of the CS Update were consistent with the aforementioned priority areas and/or with the 2008 update. With respect to said update, two operations, Climate Change I and II, were approved in 2008 and 2009, respectively. The objective was to consolidate the institutional and operational framework underpinning Mexico’s climate change agenda, mainstreaming climate change considerations in public policy, as well as spur the implementation of tools and instruments necessary to implement the climate change mitigation and adaptation agenda based on an operational framework. See breakdown in Annex I.4.
3.
New sector and rationale Strengthening public finances: The objective is to strengthen the sustainability of fiscal policy in Mexico, guaranteeing macroeconomic and financial stability and improving efficiency and transparency in the use of financial resources from the federal government, with emphasis on increasing quality in fiscal and budget management and making tax administration more efficient.
4.
Financial scenario The Government of Mexico has requested from the Bank a program of SG operations for 2010 in the amount of US$4.5 billion. However, that level of approvals is restricted by the current financial capacity of the Bank.4 For the same
4
According to document GN-2442, Mexico received an initial allocation for disbursements in 2010 of US$1.5 billion for its SG operations and therefore its approvals level is being adjusted to adhere to that limit.
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period, approvals of NSG operations are estimated at US$110 million and nonreimbursable operations at approximately US$15.6 million. 5.
Country systems Throughout the period of the CS Update, the IDB, the Civil Service Department (SFP) of the federal government, and other Mexican executing agencies have moved forward with implementation of concrete targets for increasing the use of country systems. Based on the 2007 OECD/DAC evaluation, the Country Procurement Assessment Report approved in 2008, the five harmonized bidding documents updated in 2009, and the study of a Consulting Industry Action Agenda in 2010, Mexico is taking steps to gradually strengthen its procurement systems. This is in line with the trend in other middle-income countries and is consistent with the Bank's procurement policies, thereby facilitating the execution of resources within a framework of efficiency and transparency. Similarly, Mexico has made headway on financial administration considerations, implementing in 2010 the Integral Accounting and Budget System. The main challenges moving forward regarding financial administration and control are related to the potential use of the reports from Mexico's Superior Audit Office as a complement to the external audit of the project and the executing agency. In 2010 there are plans to continue harmonization on fiduciary considerations with the World Bank and to jointly review the eligibility criteria and processes for external auditors used by the Civil Service Department to audit projects financed by both Banks. With respect to the analysis of environmental and social systems, the existing legislation and institutional gains made by Mexico show signs of significant progress in recent years. Nonetheless, the IDB's experience in Mexico and elsewhere in the region shows that, to promote the use of country environmental systems, an analytic approach should be taken that evaluates both the legal regulations and their implementation in the country strategy's priority sectors. This analysis should evaluate both the strengths and weaknesses of the regulations and actions with which the Bank can support the country in strengthening the institutions responsible for their enforcement at the federal, state, and municipal levels.
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ANNEX I: OPERATIONS APPROVED DURING THE EFFECTIVE PERIOD OF THE CS UPDATE (As of 31 March 2010)
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4. MEXICO
Loans Project number
Loan number
Operation name
Date approved
Amount approved (US$)
Elimination of barriers to private sector competitiveness ME-L1065
2173/OC-ME
Global Credit Program for the Development of Debt Markets II
7 Aug 2009
500,000,000
ME-L1041
2181/OC-ME
Direct Support to Rural Areas
9 Sep 2009
750,000,000
ME-L1051
2226/OC-ME
Program to Promote the Development of SME Suppliers and Contractors for the National Oil Industry
11 Nov 2009
301,000,000
21 May 2009
600,000,000
29 Jul 2009
100,000,000
28 Oct 2009
150,000,000
13 Jan 2010
100,000,000
16 Sep 2009
400,000,000
Social sector and poverty reduction ME-L1067
2140/OC-ME
ME-L1039
2167/OC-ME
ME-L1084
2219/OC-ME
ME-L1033
2285/OC-ME
Second Project to Strengthen the Oportunidades Human Development Program Skills-based Human Resource Development Program (PROFORHCOM II) Complementary Loan, Training and Employment Support Program (PACE) Phase II Community Education Program - Phase II: Social Equity Builders
Climate change ME-L1058
2186/OC-ME
Climate Change II (PBL)
Elimination of barriers to private sector competitiveness ME-L1066
2135/OC-ME-1
Puerta de Hierro Project
6-May-2009
8,000,000
ME-L1066
2135/OC-ME-2
Puerta de Hierro Project
6-May-2009
4,000,000
ME-L1077
2196/OC-ME
BBVA Bancomer S.A. TFFP
14-Aug-2009
50,000,000
ME-L1069
2209A/OC-ME
BBVA Bancomer Green Facility
21-Oct-2009
40,000,000
ME-L1069
2209B/OC-ME
BBVA Bancomer Green Facility (Guarantee)
21-Oct-2009
50,000,000
ME-L1075
2273/OC-ME
Mi Tienda: Rural Supply Network
14-Dec-2009
2,000,000
ME-L1076
2274A/OC-ME
EDF – La Ventosa Wind Power Project
14-Dec-2009
280,000,000
ME-L1068
2275A/OC-ME
Eurus Wind Project
15-Dec-2009
50,000,000
Total
3,385,000,000
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Technical Cooperation Operations Project number
Name of the technical cooperation operation
Date approved
Amount approved (US$)
Elimination of barriers to private sector competitiveness ME-T1125
Study of Best Practices and Implementation Plan for Creating a Selfregulated Securities Market for SMEs in Mexico
08 Jan 2009
121,100
ME-T1136
Support for the Legal and Institutional Strengthening of Credit Bureaus
30 Jul 2009
70,103
ME-T1145
Marketing Agricultural Products and Direct Support to Rural Areas
19 Nov 2009
1,000,000
Modernization of the State and decentralization ME-T1119
Preparation of the State Program of Climate Change Action in Yucatรกn
15 Jan 2009
200,000
ME-T1123
23 Oct 2009
1,000,000
ME-T1124
PRODEV: Support for Implementation of a Results-based Budget System in Yucatรกn Tabasco: Support for Implementation of the Results-based Budget System
03 Dec 2009
1,000,000
ME-T1130
Municipal Cadastral System Strengthening for the "Mejora tu Calle" Program
19 Feb 2009
210,000
ME-T1135
Investment Fund for States and Municipalities
26 Jan 2010
1,500,000
ME-T1138
Baja California: Support for Implementation of the Results-based Budget System
09 Dec 2009
800,000
ME-T1139
Michoacรกn: Support for Implementation of the Results-based Budget System
09 Dec 2009
800,000
ME-T1143
Support for Planning, Design, and Urban and Physical Management of the Municipio of Ciudad Juรกrez
31 Jul 2009
15,000
ME-T1149
Support for the Urban Development of Municipios in Mexico
11 Mar 2010
135,500
ME-T1111
Support Team for Mexico's Climate Change Agenda
09 Apr 2009
450,000
ME-T1069
National Sustainable Energy Program
04 Aug 2009
1,000,000
ME-T1114
Aligning Learning Incentives
16 Jul 2009
1,350,000
ME-T1115
Crisis Management System for the Education Sector
07 Oct 2009
500,000
ME-T1133
CCT Clearinghouse and Capacity Building Initiative
08 Dec 2009
749,991
ME-T1134
Rural and Semi-urban Wireless Connectivity Project
11 May 2009
150,000
ME-T1137
Support to Control the Transmission of the AH1N1 Flu Virus in Mexico
13 Aug 2009
850,000
ME-T1141
Support to Control the Transmission of the AH1N1 Flu Virus in Mexico
13 Aug 2009
150,000
Climate change
Social sector and poverty reduction
Total
12,051.5
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MIF Operations Project number
Operation name
Date approved
Amount approved (US$)
Elimination of barriers to private sector competitiveness ME-M1054
Consolidation of a Network of Indigenous Microenterprises by Strengthening Regional Tourism
15 Jan 2009
149,662
ME-M1041
Model of Public-private Support for Continuing Development of Workers in Growing Investment Markets: Tourism Sector in the Mayan Riviera
18 Feb 2009
1,990,000
ME-M1053
Private Sector Development and Competitiveness
25 May 2009
150,000
Modernization of the State and decentralization ME-M1055
Strengthening of Municipios for the Development of Public-Private Partnership Projects (MuniAPP)
10 Mar 2010
2,030,000
ME-M1057
State of Tabasco: Promotion of Public-Private Partnerships (PIAPPEM)
26 Oct 2009
350,251
Total
4,679,910