Mexico began a major push to expand high-standard highways using private financing and long-term toll concessions. The program planned dozens of projects and quickly expanded the national toll-road network. It set the basic pattern for the 1990s: private construction and operation, funded mainly by toll revenue and debt.
Mexico published the Ley de Caminos, Puentes y Autotransporte Federal in the Official Gazette, creating a clear federal legal basis for highway and bridge concessions. The law required a concession to build and operate federal roads and allowed long terms (up to 30 years, with potential extension). This helped formalize how toll concessions and tariff rules would be set and supervised.
Between 1989 and 1994, Mexico awarded about 53 toll-road concessions with investment on the order of US$13 billion. The network growth was fast, but many projects relied on optimistic traffic forecasts and aggressive construction schedules. These early design choices increased financial risk for both concessionaires and lenders.
The December 1994 currency crisis worsened toll-road finances by increasing debt burdens and weakening demand. Many concession companies could not meet their payment obligations, and banks accumulated large nonperforming loans tied to the toll-road portfolio. The toll-road expansion effort slowed sharply as projects became difficult to finance and operate sustainably.
On August 27, 1997, the federal government announced the "Road Rescue Program" to repossess/rescue 23 out of 52 concessioned roads that were failing financially. The plan reflected a shift from rapid privatized expansion to stabilization and continuity of service. It also signaled that earlier traffic and cost assumptions had not held up under real conditions.
After the rescue, Mexico used BANOBRAS (a state development bank) to support administration and financing arrangements for the rescued toll roads through FARAC (Fideicomiso de Apoyo para el Rescate de Autopistas Concesionadas). The mechanism was designed to keep roads operating, address compensation and debt re-documentation, and manage revenue from the rescued network. This created a central public platform to stabilize and later re-tender parts of the toll-road portfolio.
By the end of 2000, federal audit reporting showed FARAC liabilities in excess of 100 billion pesos, reflecting the scale of the rescue obligations. Audit reporting also recorded that additional road segments and bridges were incorporated into FARAC during 1998–2000. This period highlighted how the rescue program’s costs and scope continued to evolve after the initial 1997 announcement.
In the early 2000s, Mexico developed "Proyectos de Prestación de Servicios" (PPS), a long-term service contracting model similar to availability payments (government pays for a service over time, rather than relying only on tolls). An Inter-American Development Bank technical cooperation (approved in 2003) supported the legal and institutional framework for initial PPS pilots. This broadened the PPP toolkit beyond the 1990s toll-revenue-only approach.
To restart private participation while managing past risks, the federal government began re-licensing packages of existing toll roads under the "Aprovechamiento de Activos" (asset monetization) approach. These tenders focused on operating, maintaining, and upgrading roads (often including required investments) in return for concession rights and payments to government. The approach aimed to turn stabilized, publicly managed assets into bankable concession opportunities again.
On August 6, 2007, the SCT awarded a major concession package (including Guadalajara–Zapotlanejo, Maravatío–Zapotlanejo, and León–Aguascalientes corridor elements) to a consortium associated with ICA and Goldman Sachs Infrastructure Partners. The concession covered operation and conservation for decades and required new construction and widening works. This award became a landmark example of re-privatizing (under new terms) assets connected to the earlier rescue era.
Mexico created the National Infrastructure Fund (FONADIN) by decree published February 7, 2008. FONADIN was designed as a financial platform to mobilize private capital and support infrastructure projects, and it was formed by combining resources and assets from earlier funds (including FARAC and FINFRA). This institutional change strengthened federal capacity to structure and support highway PPPs in the late 2000s.
On May 27, 2010, the federal government granted a PPS-based highway concession for the Mitla–Entronque Tehuantepec II road in Oaxaca. Under PPS, the concessionaire builds and maintains the road and is paid through a long-term services contract structure rather than relying only on toll traffic. This marked a clear endpoint for the 1990–2010 arc: Mexico moved from early 1990s toll-revenue concessions, through a major rescue, to more structured PPP models supported by specialized public funds.
Implementation of highway toll concessions and PPPs in Mexico (1990–2010)