Economy

What are Mexico City plans to small and medium-sized enterprises?

Mexico City's companies are preparing a plan to deal with the pandemic featuring big enterprises and workers

Mexico City's companies are preparing a plan to deal with the pandemic featuring big enterprises and workers. Photo: Shutterstock

Mexico City‘s companies have considered Mexico’s federal government economic plan during the coronavirus epidemic ineffective so they prepared their own, according to a Forbes Mexico report.

The private sector at Mexico’s capital have predicted authorities announcement of a shutdown until May 30, therefore, they united forces with big enterprises to mitigate small endeavors closure during this crisis.

The Chamber of Commerce, Services and Tourism (Canacope) of Mexico City intends to launch on April 30 its rebounding plan for the pandemic period and post-coronavirus phase. Eduardo Contreras Pérez, Canacope‘s president, said to Forbes that the group will work with their own ways and allies. “We are not considering any kind of government support. Our plan aim is to aid small businesses”.

According to Contreras, on the presentation of April 30 it will be known the number of layoffs and companies that already have closed. They will be presented alongside the actions to reactivate the economy when shutdown period be over.

These actions will go hand in hand with the measures that the federal government and authorities of Mexico City have announced to sustain and launch the economy during this period, Pérez said.

A study by Canacope reveals that small enterprises with an employee requires MXN 20,000 ($838) a month to cover payroll, social security, treasury, and local rent expenses; which exceeds the governmental palliatives, revealed the leader of the organization.

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The group believes that microcredit and government loans help but don’t solve the problem. For this reason, Canacope asked the authorities to defer the payment of payroll taxes to 12 months for the following year, in addition to the payment of work risk before Social Security for the moment, since the employees are at home.

Meanwhile, the Employer Confederation of the Mexican Republic (Coparmex) in Mexico City expects companies that are remote working to continue operating under this scheme. In this sense, large companies should adopt the smaller ones that are part of their business circle.

Mexican companies are also increasing dialogue with the labor sector, to modify contractual relations during the months of the health emergency with salary adjustments instead of layoffs.