José Luis Romo Cruz, Executive Secretary of Public Policy, State of Hidalgo: Interview

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José Luis Romo Cruz, Executive Secretary of Public Policy, State of Hidalgo

Interview: José Luis Romo Cruz

How has economic growth in Hidalgo led to greater development and less poverty?

JOSÉ LUIS ROMO: Private investment has injected significant dynamism into Hidalgo’s business environment. It has boosted small and medium-sized enterprise expansion, which subsequently contributed to an increase in socio-economic levels for the local population as well as a reduction of the state’s poverty rate. Since the current administration took office in 2016, 18,000 new jobs have been created, thus generating a sustainable impact on the state’s average household income; according to the National Institute of Statistics and Geography, Hidalgo’s average household income increased by 6.5% between 2016 and 2018, while the national average decreased by 4.7% over the same period. Over the two years the income gap between Hidalgo and the country’s average decreased by 31%, while 167,000 people from Hidalgo have been lifted out of poverty – the second-highest poverty reduction nationally.

To what degree has the state of Hidalgo been able to improve its financial situation?

ROMO: For a number of years Hidalgo’s local governments grappled with financial difficulties, creating uncertainty and affecting development. Many of the former official financial mechanisms that caused this have been eradicated, and fiscal responsibility has become a central part of the public state administration. The government has reduced existing public debt, with a total of $14.4m paid to creditors.

These initiatives have been recognised by different rating agencies, which, for the first time in the state’s history, have granted Hidalgo the “AAA” credit rating. Aside from the accountability and transparency criteria that the government has to take into account, it has also become increasingly more important that these funds be allocated to more productive sectors, – for instance infrastructure, education and health.

In what ways will the new security centre, the C5i, strengthen the state’s security system?

ROMO: The launch of the C5i in 2019 represented an important step towards consolidating the state’s security. This centre monitors and controls 6500 security cameras, 38 road points, 20 drones and a plane, and connects all of the security services, including the military and the police forces. The business community is now able to link their security cameras to the centre, so their systems are better monitored. In addition, companies are able to send real-time alerts from any electronic device, for instance mobile phones, speeding up response times.

Which industries have been identified as having significant potential to drive the state’s economic development in the medium term?

ROMO: Hidalgo’s economic development strategy is driven with the aim of capitalising on local resources to boost the state’s singularity and competitive advantages rather than competing with other regions in attracting investment within the same sectors. For instance, smart mobility is an industry that has not been explored by any other state in the country, which has opened the door for Hidalgo to tap this outstanding and promising opportunity. It is a critical industry for the future development of the state, and it holds great growth potential not only in Mexico but also in international markets.

Since 2016 the government has attracted substantial investment in the electric and hybrid cars industry, accounting for a total of $250m. The projects – one run by China’s JAC Motors, and another by Mexico’s Ensambladora Latinoamericana de Motores and China’s FAW – will serve as anchor investments to further develop a smart mobility cluster in the state. JAC Motors is also working on manufacturing electric car prototypes, which will make Hidalgo home of the first line of electric vehicles produced in Latin America.

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The Report: Mexico 2019

Hidalgo chapter from The Report: Mexico 2019

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