October 7, 2020

Mexican Government Announces US$14.2B Infrastructure Plan with 39 Projects

Holland & Knight Alert
Alejandro Landa Thierry | Carlos Ochoa | Aldo González

The Mexican government announced a US$14.2 billion (MX$300 billion) infrastructure investment plan together with private sector companies. The announcement was a follow-up to the broader national infrastructure plan announced in November 2019 and part of this year's Economic Recovery Agreement (Acuerdo para la Recuperación Económica) amid the COVID-19 pandemic.

The projects are distributed in 20 states nationwide. Seven projects are already in construction and 32 are expected to break ground in 2021. The Ministry of Finance (Secretaría de Hacienda y Crédito Público) said that two subsequent project clusters will be announced for 2022 and 2023 and that the investment goal is to achieve 25 percent of the national gross domestic product (GDP).

The plan is a positive signal for private investors, who will continue to explore additional infrastructure packages to be launched by the federal government since the overall investment for this announcement remains far from the 2019 total investment numbers (MX$5 trillion).

The most important projects will be two coker plants (planta coquizadora) in Tula (Hidalgo) and Salina Cruz (Oaxaca), a high-speed train connecting Mexico City and Querétaro and a railway connecting Monterrey's airport with six municipalities in the State of Nuevo León.

Most of the other projects are focused on the construction and rehabilitation of regional highways and toll roads (20 in total).

While some projects already have been awarded, others will be subject to government procurement procedures whose legal regimes are yet to be announced.

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