1996-11-14 Local Press - Domestic Public Debt to Grow in 1997
Article Index
Domestic Public Debt to Grow in 1997
In 1997, the federal government will incur a net internal debt of 34 billion pesos (around 1.1% of GDP) in order to finance its debt. According to the proposed budget for 1997, net total spending is estimated at 725.79 billion pesos, while federal government revenues are expected to reach 694.9 billion, which means a deficit of 30.89 billion pesos. The government intends to defer payments of approximately 15 billion pesos, reducing the deficit to only 15.89 billion, or .5% of GDP. In fact, the deferred payments correspond to expenses from 1997 that will not be paid until 1998. (El Financiero, 12 November).
Courts Find in Favor of Debtor
On November 5, the Superior Court of the Federal District unanimously ruled in favor of a debtor who used Bancomer for charging "excessively burdensome" interest rates on his mortgage. The debtor, Carlos Chaim Sanchez, filed the suit charging that his monthly interest charges on his mortgage increased from 22.13% in 1995 to 85% 1995. The court found that, although the mortgage was taken out with a floating interest rate, the enormous increase surpassed what could have been expected "in good faith". Therefore, they ordered Bancomer to reduce the excess yields by 50%. Tens of thousands of other debtors in Mexico City find themselves in similar conditions, and can be expected to follow Chaim's lead- (Reforma, 6 November).