IMF Urges Mexico to Curb Refining Plans, Warns of Policy Uncertainty Weighing on Investment

In the midst of a global pandemic and a once-in-a century recession, Mexico needs to do a better job of allocating spending and stimulating investment to help with the economic recovery, according to a new report by the International Monetary Fund (IMF).

Regarding energy, the IMF team was critical of state oil company Petróleos Mexicanos (Pemex) and its use of limited capital.

“Pemex’s business strategy is crowding out resources for essential spending,” the analysts said. “Given its widening losses, it is advisable to focus production only in profitable fields, sell noncore assets, curb plans to increase refining output at a loss, and postpone new refinery plans until it is profitable to do so.” 

The latter is a reference to the Dos Bocas refinery, which was a...