Weekly Report - 1 July 2003

Carlos Slim, the Mexican billionaire reputed to be the richest man in Latin America, has triggered a heated debate in political and economic circles with a call for the government to start spending more and worrying more about growth than about inflation and budget surpluses. 

Mexico, he says, 'needs development models not adjustment models.' He argues that the authorities have acted 'intelligently' in monetary and fiscal matters in recent years, but that they have not done enough to ensure growth. In this, he says, official thinking in Mexico lags behind that of multilateral lenders like the IDB and the World Bank. 

Slim criticises the accumulation of international reserves by the central bank, which he says represent an enormous cost for the country. Instead of the current US$53bn, he maintains, something between US$35bn and US$40bn would be 'reasonable'. 

His tirade coincided in time and content with another from the opposite end of the entrepreneurial spectrum: the small-business commission of Concamin, the confederation of industrial chambers. Last week it urged the government to reorganise its promotional schemes to favour the development of the domestic market, and to make growth the top priority.