Mexico has recovered rapidly from the global economic crisis. What have been the country's major economic achievements?
Last year, Mexico grew nearly 4 per cent and created nearly 600,000 net new jobs in the formal sector, all within the context of sound public finances: a public deficit of less than 2.5% of our GDP, while Mexico 's total external debt accounts for 32% of our Gross Domestic Product.

Our international reserves exceed $147 billion, two and a half times the Federal Government's internal and external debt. We also have access to an additional credit line of $72 billion agreed with the International Monetary Fund three years ago. Our banking system is solid. Mexican banks report average capitalization levels of over 15%, much higher than the new standards established in Basle.

Lastly, our economy is becoming increasingly competitive. Last year, our exports reached a record level of $350 billion. Mexican manufacturing exports are greater than the combined exports of all Latin American and Caribbean countries. However, we also know that the current crisis affects us all, to a greater or lesser extent, which is why we are interested in contributing to its solution.

What are your main priorities as Mexico becomes the president of the G-20?
Despite the severity of the problem in Europe, I am pleased to see that the Euro zone countries are gradually coming up with the required solutions. We are delighted, for example, that major agreements and reforms have been achieved to enable several countries in that region to implement credible measures that will reduce their enormous fiscal and external deficits, and that a second rescue package has been approved in the complicated case of our Greek friends. We know that much remains to be done, but these are obviously steps in the right direction.

The Mexican Presidency of G-20 has proposed a working agenda with five priorities: restore economic stability and growth; strengthen international financial institutions; improve financial systems, including measures to expand financial inclusion; tackle the issue of food security; promote green growth. As you can see, we wish to deal with the main challenges of the future, not only those of the present. However, the economic problem will obviously be the main concern of the participating countries and of public opinion. And this relates to our main priority: stability and growth.

We have learned lessons from our own mistakes and from the economic crises we have experienced in the past, which may be useful for dealing with certain aspects of the current economic situation. Perhaps the most important lesson we have learnt is that in the face of problems, one must act with determination and in a timely manner in order to recover credibility and economic stability.

 

Can you tell us how you pretend to restore economic growth in the Mexican economy?
We know that the greatest responsibility falls on the European countries currently suffering from these problems, but it is also clear that we all must help and we must demonstrate our willingness to do so. It is important for the world and it is also important if we are to solve these problems.

Restoring economic stability is obviously the most important part of the equation. However, this is only part of the equation. We must cope with current challenges at the same time. Therefore the G-20 will have to address our other problems. It is not only a question of stabilizing finances but of restoring economic growth, moreover of knowing how to do so, in an environment where expansive fiscal and monetary policies are, in certain places, showing clear signs of exhaustion, or rather, , are now impossible to implement in many countries due to the restrictions imposed by the situation.

We can restore growth in several ways: First, As many countries have already done, by promoting structural reforms that make it possible to increase the competitiveness of economies and their productivity thereby creating sustainable, long-term growth; Second. Perhaps the most important response for restoring growth with restrictions in monetary, fiscal and expansive policies is to strengthen the global trade; Third. We must renew the infrastructure of developed countries but above all, in developing countries, where, in fact, enormous opportunities for growth and business are being opened up. And the fourth is in sustainable development itself, in green growth. 

Trade is key to recovering growth. And this obviously includes dealing with the global imbalances in economies with large surpluses in their current account, in order to enable them to strengthen their internal market and grow not only their own economy but also the global economy. And on this subject there is a paradox that will operate in our favor. There is a large amount of capital, there is a large amount of private capital available in the world, in pension funds, in sovereign funds and in insurance companies.

And if we manage to achieve a match between long-term liabilities, such as pension and saving fund obligations, and long-term assets, such as infrastructure investment, this will have a positive effect on growth rates. The third area of opportunity lies in the expansion of growth by providing access to the banking system for personal, small and medium firms. So the second priority for Mexico is to strengthen international financial institutions, by which we obviously mean the International Monetary Fund, European financial support mechanisms, regional development banks and multilateral organizations.



What are the current priorities of your administration?
In Mexico, we are convinced that more people should have access to financial services, particularly the poorest sector. That is why we will insist that the G-20 encourage education and financial inclusion. This is crucial, moreover, for financing, micro, small and medium-sized firms and for personal firms. If we can manage this, it will also contribute to promoting economic growth with equity. And economic growth with equity is just what we are all looking for.

Another priority is food security. If we understand that the world’s poorest people, by which I mean at least one billion people, spend half their daily income on food, and if we note that food prices have doubled over the past decade, we can safely say that, although the most recent figures are yet to be published, world poverty has dramatically increased in recent years.

The increase in food prices also explains many things, not just the famine in the Horn of Africa, which 20 years ago, we were certain was never going to happen again. The increase may also be behind the economic, social and political turbulence that has been seen all over the world: in North Africa, in the Middle East and in other regions.

Thus the G-20 economies will have to deal with the problem of food security, not only for humanitarian reasons, which is obviously the main reason, but also because, paradoxically, it provides enormous opportunities for economic growth.