Mexico gets energy sector loan

MEXICO CITY, Oct. 1 (UPI) -- The Inter-American Development Bank granted Mexico a loan to allow construction companies to supply the state-owned oil company Petroleos Mexicanos, or PEMEX.

El Universal reported Wednesday that the $600 million IDB loan is intended to boost the development of Mexican construction companies that are interested in becoming suppliers and contractors to PEMEX, the world's 10th-largest oil company, which holds a monopoly on the country's hydrocarbon production. Most Mexican companies currently lack the fiscal resources necessary to participate in PEMEX's bidding processes.

In the wake of recent legislation passed by the administration of Mexican President Felipe Calderon requiring PEMEX to outsource 30 percent of its services from national companies, the IDB loan is necessary to allow indigenous companies to compete in the bidding process. Mexico's Banco Nacional de Obras y Servicios Publicos will be responsible for overseeing the distribution of the IDB loans.