Monday, November 7, 2011

Senate iniatiative to regulate state debt

The PRD presented an initiative in the Mexican senate to regulate the debt of Mexico's state - essentially, to make debt contraction more transparent and avoid bankruptcy in public finances.

The measure is very likely inspired by the case of Coahuila, but many other states, the vast majority PRI led, are also in danger of financial collapse after having contracted far too much debt on their own.

From what I recall, this is essentially what many states in Brazil did as well as part of a process of de-centralization of power - though they ended up heavily indebted in the process, and eventually had to strike a deal with the federal government. If any reader has a good summary / recommended read about this period in Brazil, I'd appreciate a tip.

No comments:

Post a Comment