00:00For decades, Mexico has enjoyed a reputation for being one of the most financially responsible
00:05countries in Latin America. Today, it finds itself at risk of losing its investment-grade
00:10credit rating. There are plenty of reasons for the decline, like sluggish growth and higher
00:14social spending, but experts keep pointing to one issue, the financial losses at state
00:19oil company Pemex. In the last eight years, Mexico has showered some $130 billion on the
00:26state oil giant in financial support. That's more than Mexico spends on its military and
00:31on fighting the cartels. The money has helped keep Pemex afloat as it struggles to boost
00:35production and pay down its massive debts, but at the same time, it's eroding Mexico's
00:39own finances, and so much so that the nation's sovereign bonds already trade like junk, paying
00:45higher yields than smaller nations such as Guatemala and Panama. While investors say its
00:50unlikely ratings agencies will downgrade Mexico in the short term, the real risk will come
00:55if Mexico is unable to fix Pemex. President Claudia Sheinbaum is trying to attract private
01:00partners to boost oil production and make the company self-sufficient by next year. In addition
01:05to pumping more oil and gas, experts say Pemex needs to slim down its huge workforce, increase
01:10efficiencies at its refineries, and pay down its massive debts. Until then, experts expect
01:15Mexico to keep spending billions in taxpayer dollars to keep the oil giant afloat.
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