Mexico: Devaluation hits health Pledges

In Mexico, the pledge of new President Ernesto Zedillo Ponce de Leon to undertake a major restructuring of the health care sector as a priority has been dealt a very significant blow by the sharp devaluation of the peso.

Observers expect, at best, serious delays in the implementation of the ambitious projects announced by the president when he was inaugurated on December 1, 1994, for a six-year term. He has called for a 60-day moratorium on price rises, but these have continued to move up despite fines and temporary business closures. Cuts in government spending and the freeze on salaries will inevitably affect drug prices; even before devaluation, they rose 50%-100% in 1994. Moreover, with a large share of drugs on the market containing ingredients from overseas, further sharp price rises are expected in the near future.