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Nuevo Leon

MARKET REPORT: MEXICO

The population in the northern Mexican state of Nuevo Leon is growing at 2% per annum. The state's existing infrastructure is unequal to the demands being placed on it, but the challenge has been met by a radical reorganisation. Under a development plan produced last year, the state is to 'agglomerate' its 5,900 towns and villages, producing 1,700 medium size towns of 50,000 people and cities of up to 300,000.

A huge amount of public work is needed to expand water supply and sewerage. Significant new road construction, including radial and ring roads around the state capital of Monterrey, will be needed to link the new conurbations. A light rail route and a £1bn extension of Monterrey's Metro have been mapped into the state plan.

The Metro is subsidised to the tune of £1.25M/year but will break even if fares are raised from three pesos (20 pence) to five pesos (35 pence) per journey. In the state as a whole there are 4M passenger movements a day using all modes of transport.

New state laws were passed to force the production of a comprehensive transport plan.

Legislative changes have also enabled private sector involvement in public transport.

The move is exciting interest in other states, including Chihuahua, Aguascalientes and Puebla.

Development of Nuevo Leon will also require new commercial and industrial buildings, houses, hospitals, schools, hotels and leisure facilities. A new university is to be developed in Monterrey.

All project finance is generated by the state itself, which is battling to clear debt.

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