Carlos Sacal
Cámara Nacional de las Industrias de la Celulosa y del Papel, Mexico
General economic information
The economic activity picked up in 1996, indicating the start of recovery from the crisis, for which various emergency programmes were implemented to deal with the serious devaluation of December 1994.
Everything suggests that the groundwork has been laid for initiation of sustained economic recovery on condition that there are no political or social surprises, or external contingencies - 1997 should be a year of economic consolidation if present trends continue. In contrast to previous crises, the economic cycle in this latest crisis took the form of a sweeping rapid fall followed by a relatively quicker sustained rebound, which even averted high inflation from the devaluation - inflation in 1996 amounted to 27.7 percent as compared to 52 percent in 1994.
The response of the economy reflected the structural economic and financial reforms that had been introduced and bolstered during the previous six-year term, reinforcing the national economy and streamlining mechanisms of adjustment to external and domestic disruption. There was therefore no need for restructuring on the account of the external debt, for re-energizing the export sector or for shaping new external relations.
However, the process of recovery initiated in 1996 is not yet general as certain activities are clearly moving forward, while others have failed to take off. Similarly, the domestic economy is weak while the export economy is strong, reflecting monetary constraint and the resulting tight money supply and weak purchasing power.
The government strategy in 1996 has been the following:
· recovery of production and employment;
· macro-economic stabilization;
· refocusing of public expenditure; and
· continuity of the financial system.
The GDP for 1996 was 5.1 percent higher than in 1995. Inflation stood at 27.7 percent while public expenditure showed a minimal preliminary deficit of 0.2 percent of GDP.
Macro-economic results
|
Variables |
1996 |
1995 |
|
GDP |
5.1% |
-6.9% |
|
Inflation |
27.7% |
51.9% |
|
Financial surplus or deficit (pesos) |
(0.2)% GDP |
0.05% GDP |
|
Monetary reserves (million US$) |
17 519 |
15 741 |
|
Trade balance (million US$) |
6 414 |
7 397 |
The pulp and paper industry (third quarter real terms annualized to 1997)
The pulp and paper industry accounted for 2.7 percent of manufacturing GDP and 1.9 percent to industrial GDP. Pulp and paper GDP fell 0.1 percent from 1995. As regards industrial and manufacturing GDP, these were up 10.4 percent and 10.9 percent, respectively, from 1995.
Pulp production in 1996 rose by 67 000 tons which is a 16 percent increase compared to 1995. This increase virtually covered all types of pulp produced in the country: short- and long-fibre sulphate pulp, unbleached sulphate pulp, bleached other fibre pulp and chemical thermo-mechanical pulp.
The increase in pulp production was essentially due to the continued activity of plants that had been closed until 1994 and to the start up of others, despite the fluctuations in international prices which remained below historical levels.
As regards the paper sector and fibre consumption, it continued to use a mix of predominantly secondary fibres (72.3 percent of the total) and virgin fibres (remaining 27.7 percent).
The paper industry has introduced a number of measures to minimize environmental impact. The fact that the total paper production of 3 162 000 tons in 1996 used 2 887 000 tons of secondary fibres (72.3 percent) is particularly noteworthy. The remaining 27.7 percent of virgin fibres were made up as follows: 14 percent chemical wood pulp; 4.6 percent chemical other fibre pulp; and 1.4 percent chemical pulp.
The use of secondary fibres in paper manufacture places Mexico among world leaders in the recycling of paper.
The paper production total of 3 162 000 tons in 1996 represents a 3.8 percent increase over 1995 and was due to higher export sales and a slight recovery of the domestic market. Imports increased by 86 000 tons over 1995 representing a 13.3 percent growth. Apparent consumption showed an increase of 9.8 percent.
Paper production for the various grades was as follows:
· Newsprint increased by 1.1 percent to a total of 267 600 tons; other printing and writing paper also increased by 1.1 percent, reaching 514 700 tons.· Total production of printing and writing paper, including newsprint, therefore amounted to 782 300 tons - equivalent to a 1.1 percent increase over 1995.
· Packaging increased by 5.9 percent to 1 876 000 tons. The items with the greatest growth were bag paper and containerboard.
· Sanitary and facial tissues and household paper registered a total production level of 475 900 tons, which represents a drop of 0.3 percent. Finally, speciality papers closed the year at 25 500 tons, posting a 14.9 percent growth.
There is no doubt that Mexico's pulp and paper industry is particularly sensitive to changes in international markets and there have been signs that the paper industry has recently lost ground on the domestic market. Furthermore, the sector is affected by political circumstances which make it difficult for the government to establish monetary parity in line with external economic realities.
