Mexico's Performance on the Resource Governance Index
Mexico received a "satisfactory" score of 77, ranking 6th out of 58 countries, the result of high scores on all components except on the Enabling Environment.
(out of 58)
(out of 100)
|6||Institutional & Legal Setting||84|
|8||Safeguards & Quality Controls||81|
Institutional & Legal Setting (Rank: 6th/58, Score: 84/100) learn more
Mexico's extractive resources are governed by a strong legal framework, leading to a "satisfactory" score of 84.
By law, the state-owned oil company Petróleos Mexicanos (Pemex) dominates the industry. There is no licensing process, though Pemex does sign service contracts with other companies. Some contracts are awarded through competitive bidding, but Pemex may also sign agreements through a non-competitive "direct award" process.
The National Hydrocarbon Commission regulates the sector, while the Energy Ministry oversees Pemex's activities and sets policy. The Finance Ministry collects taxes and other revenues and transfers them to the treasury. The Federal Transparency and Access to Information Law requires comprehensive disclosure of industry information; environmental impact assessments are also required.
Reporting Practices (Rank: 7th/58, Score: 82/100) learn more
Mexico received a "satisfactory" score of 82, reflecting comprehensive disclosure on many revenue indicators but poor contract transparency.
Only limited information on Pemex's subcontracting policies is published before contracts are awarded. Information on the selection process is not always available, and service contracts are not published.
Comprehensive industry data are available online, but reports can be difficult to understand and information must be pieced together from different agency websites. The Finance Ministry publishes disaggregated data on payments received from Pemex, export values, production costs, and the cost of subsidies. The Energy Ministry and the National Hydrocarbon Commission publish reports on the petroleum sector, but rely on information from Pemex.
Safeguards & Quality Controls (Rank: 8th/58, Score: 81/100) learn more
Mexico's "satisfactory" score of 81 is largely due to substantial audit requirements that are not always effective in practice.
Pemex officials exercise considerable discretion in the subcontracting process. Congress oversees Pemex's activities and must approve the company's budget. Lawmakers have no responsibility to review service contracts, but may request information from Pemex officials.
National audit organizations have the power to review all government accounts, including those of Pemex. In practice, however, auditors lack the capacity to effectively oversee the oil sector and review only a small fraction of public funds. The Supreme Audit Institution presents lawmakers with annual reports, but the figures are often at least a year old. Several legislative committees review audit reports but do not focus specifically on resource revenues.
Enabling Environment (Rank: 18th/58, Score: 53/100) learn more
With a particularly low ranking for the rule of law, Mexico received a "partial" score of 53, its lowest on any component.
State-Owned Companies (Rank: 2nd/45, Score: 98/100) learn more
Pemex is entirely government-owned and has a legal monopoly over petroleum exploration, production and commercialization. The company publishes information on reserves, field-by-field production volumes, prices, export values, investment, production costs, social payments made to local governments in producing regions, disaggregated revenues, and payments to the government. Some of this information is buried in highly technical reports. Pemex's accounts are audited in accordance with international standards and audit reports are made public.
Natural Resource Funds (Rank: 6th/23, Score: 79/100) learn more
Oil prices have exceeded the price estimated in the national budget each fiscal year since 2006, resulting in additional revenues. In 2002 the government created the Oil Income Stabilization Fund to ensure continued investment in Pemex. The fund is one of four stabilization funds that by law must receive any surplus oil revenues; it is administered by the Finance Ministry. Rules for deposits and withdrawals are defined by law, but Congress has approved changes allowing the fund to cover Pemex's operating expenses. Basic financial data are published quarterly and presented to Congress.
Subnational Transfers (Rank: 8th/30, Score: 81/100) learn more
The governments of oil-producing states receive a portion of extractive revenues through direct transfers. There are no conditions on how these transfers are spent and financial data are not published. However, the bulk of subnational transfers are made through the central government's normal revenue distribution processes. These transfers are based on population and economic needs and come out of the general budget, which combines petroleum receipts with other sources of national income. Information on these disbursements is published quarterly by the Finance Ministry.
INSTITUTIONAL & LEGAL SETTING
SAFEGUARDS & QUALITY CONTROLS
To explore all data and compare country scores, use the RGI Data Tool.
Key Economic Indicators
|GDP (constant 2011 international $ billion)||742.2||961.4||1,153.3|
|GDP per capita, PPP (constant 2005 international $)||11,853||12,191||12,814|
|Oil and gas revenues (% total government revenue)||41||33|
|Extractive exports (% total exports)||11||17||20|
|Sources: Oil and gas revenue as share of total government revenue from the Economist Intelligence Unit and the International Monetary Fund. All other data form the World Bank.|