Mexico’s Debt Trick for Pemex Sparks Global Copycats ...Middle East

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Mexico’s Debt Trick for Pemex Sparks Global Copycats
In July this year, the Mexican government did something no other government had ever done. It used a corporate debt tool to reduce the massive debt pile of state-owned energy major Pemex. Now, others are using this as a template for their struggling state entities. In July, the Mexican government issued $12 billion worth of something called P-Caps. Normally used in corporate circles, P-Caps, or pre-capitalized securities, allow a borrower access to debt funding in case of need but without being included in its balance sheet. The securities sit…

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