Wednesday, April 20, 2005
Last post of the day...
More discussion about allowing mandatory private pension fund administrators (Afores) to invest in the energy sector.
Some argue that pension funds should be investing in Pemex (oil) and CFE (electricity) to help those para-statals (sp?) expand their operations or upgrade their infrastructure. They argue that the pension funds shouldn't be investing abroad.
While domestic savings and investment might have been one of the goals of the pension privatization in Mexico (see book by Raul Madrid), I'm not convinced that investing those funds in Pemex or CFE would be good for future pensioners. Until those companies demonstrate efficient returns and subsidies are eliminated (did I really just say that?), I doubt pensioners would get good returns on their investment. And their pensions are already going to be dismal, even with funds invested abroad.
posted by Michelle @ 10:40 AM,