Photo: Farming in Mexico
Mexico’s government plans to provide farmers with 44 billion pesos ($3.35 billion) in loans this year on preferential terms, President Enrique Peña Nieto said.
The president spoke during the official launch Wednesday of Financiera Nacional de Desarrollo, a development bank created as part of the financial system reforms implemented in January.
Financiera Nacional de Desarrollo will work with peasant, state and private lending institutions to support the farm sector, the president said.
The first step being taken by the development bank is to cut loan rates to single-digit levels, Peña Nieto told the peasant leaders, bankers and state officials who attended the ceremony in the western city of Guadalajara.
The move will save borrowers about 40 percent since they are currently taking out loans with interest rates of around 14 percent, Peña Nieto said.
“In 2014, the federal government will provide 44 billion pesos in loans to Mexico’s farmers, creating a great opportunity to modernize agriculture and position Mexico as one of the big food producers,” Peña Nieto said.
Farmers borrowing up to 230,000 pesos ($17,530) will get a special interest rate of 7 percent that will be cut to 6.5 percent for female borrowers, the president said.
Borrowers will have up to 15 years to repay the loans, which can be used to invest in equipment, infrastructure or any other area that will improve their farms.