Political Risk Latin America Blog @PolRiskLatam

Mexico State Gubernatorial Election

Posted in News and Articles, Political Risk by politicalrisklatam on June 30, 2011

by George W. Grayson for Center for Strategic and International Studies, June 28th, 2011.

The July 3 vote for governor of Mexico State is a trial run for the nation’s mid-2012 presidential showdown in the jurisdiction with the most registered voters—10.5 million.

Mexico State governor Enrique Peña Nieto, the front-runner to succeed incumbent Felipe Calderón, has thrown his weight behind Eruviel Ávila Villegas, candidate of his Institutional Revolutionary Party (PRI). Polls show Ávila with a double-digit lead over his opponents: Luis Felipe Bravo Mena (National Action Party—PAN) and Alejandro Encinas Rodríguez (Democratic Revolutionary Party—PRD). The momentum of the reinvigorated PRI apparatus may also lead to gubernatorial victories in Coahuila, Nayarit, and Michoacán. (continue reading… )

Download the full article here. 



Carstens praises Mexico’s war on drugs

Posted in News and Articles, Political Risk by politicalrisklatam on June 7, 2011

by Adam Thomson for Financial Times – Beyond Brics, June 7th, 2011.

Has Felipe Calderón’s made much progress on structural reform? Ask most people, and the answer would be a resounding “No”. His presidency of Mexico, they would argue, will go down as one in which areas such as tax, labour and energy went largely unchanged.

But try asking Agustín Carstens, as beyondbrics did this week, and Mexico’s central bank governor and contender for the top job at the International Monetary Fund will tell you that people are overlooking one vital structural reform: security.

Excuse me?

In an interview on Monday, Carstens said: “The crusade on organised crime is a major structural reform.” (continue reading… )

Mexico president’s party hits setback in key state

Posted in News and Articles, Political Risk by politicalrisklatam on April 12, 2011

by Dave Graham for Reuters, April 10th, 2011.

Mexican President Felipe Calderon’s conservatives suffered a setback on Sunday when they failed to seal an alliance that could have dented the chances of the main opposition party to retake the presidency in 2012.

The left-wing Party of the Democratic Revolution (PRD) rejected an offer to join Calderon’s National Action Party (PAN) in a key state election, a ploy that has brought success against the party that has traditionally dominated Mexico.

Though now in opposition, the Institutional Revolutionary Party (PRI) is leading national opinion polls. It hopes a July 3 vote in the state of Mexico, adjoining the capital and the largest by population, will serve as a springboard for a return to power in the country it ruled for over 70 years until 2000.

Had the PAN and PRD joined forces, repeating a tactic employed in other state elections, analysts said it would have raised the chance of ejecting the PRI from Mexico state for the first time, and undermined its momentum in national polls.

“If we’d got the alliance, we’d have been a step closer to defeating the PRI,” Manuel Camacho, a former Mexican foreign minister who split with the PRI in the 1990s and later served as a PRD congressman, told Reuters.

“But this story isn’t over yet,” he added. “It’s a tactical victory for the PRI, but not a strategic one.” (continue reading… )

A state of insecurity

Posted in News and Articles, Political Risk by politicalrisklatam on March 22, 2011

by Americas View – The Economist, March 22nd, 2011.

Nearly four months after the release of the first Wikileaks cables, it is surprising that the second ambassador to lose his job over the affair should be Carlos Pascual, Washington’s man in Mexico City. Mr Pascual, who had been in the job for little more than a year and a half, resigned on Saturday. Hillary Clinton, the United States’ secretary of state, said that he had stepped down “to avert issues raised by [Mexico’s president, Felipe Calderón] that could distract from the important business of advancing our bilateral interests.” By that she meant Wikileaks.

The Mexico City cables were in fact milder than most. The only other ambassador to have been removed following the leaks so far is Gene Cretz, head of the embassy in Tripoli, whose cables detailed Muammar Qaddafi’s reliance on a “voluptuous” Ukrainian nurse and described his fear of flying and love of flamenco dancing. Diplomats in Ottawa wrote that Canadians “always carry a chip on their shoulder”, partly because they think their country “is condemned to always play ‘Robin’ to the U.S. ‘Batman’.” The ambassador there survived. By contrast, Mr Pascual’s missives were pretty dry.

But his frank assessments of Mexico’s misfiring drug war and the uninspiring senior members of Mr Calderón’s National Action Party (PAN) were apparently too much to bear. Mr Calderón had made clear for several weeks that he believed Mr Pascual should go, publicly criticising his “ignorance”. Some of the PAN’s would-be presidential candidates were deeply miffed by Mr Pascual’s private comment that they were mostly rather “grey”. Following Mr Pascual’s resignation the labour secretary, Javier Lozano, posted a sarcastic message on  Twitter: “How we will miss him. Pascual had such a good eye for evaluating the candidates of the PAN.” (continue reading… )


Mexican President Targets Corruption

Posted in News and Articles, Political Risk by politicalrisklatam on March 16, 2011

by Arjan Shahani for Americas Quarterly Online, March 15th, 2011.

Felipe Calderón is changing the rules of the game for fighting corruption. Earlier this month, Calderón announced a series of initiatives targeting corrupt practices in public service and for the first time, providing rewards to whistleblowers and citizens who provide information leading to identification of these practices.

Mexico’s President recognized that “the depth at which corruption has penetrated our society is a problem we can no longer permit.”  These types of declarations, which candidly and honestly recognize our fragile state, are unbecoming of what we are accustomed to hear from him.

Possibly wanting to shift public discourse away from the violence and crime dialogue (which is obviously linked to corruption), Calderón talked about this new legal framework and what it looks to achieve in more economic terms: “we must not allow corruption to continue hurting Mexicans, reducing our competitiveness or blocking our country’s ability to grow.”

Calderón praised the effectiveness of a process called Denuncia Ciudadana through which citizens denounce public officials for illegal practices such as corruption. However, actual follow through on these claims is the real problem in Mexico. Enforcement and the capability to prosecute is a definite must if we are to see a successful outcome of these initiatives. Reforma newspaper recently ran a story on the fact that out of 1,779 public officials who have been denounced for corrupt practices only one has been prosecuted and was set free on bail. The rest of the cases continue piling up on the docket. (continue reading… )



Crisis in the U.S.-Mexican Relationship

Posted in News and Articles, Political Risk by politicalrisklatam on March 3, 2011

by Diana Villiers Negroponte for The Brookings Institute, March 2nd, 2011.

A full blown crisis has erupted in the U.S.-Mexican relationship at a time when the U.S. is focused on domestic budget issues and events in the Middle East and North Africa. The summit between President Barack Obama and Mexican President Felipe Calderón this week is intended to focus on the essential needs of two neighbors. For several months, Mexican elites have been grumbling about U.S. interference, the inadequate financial contribution within the Merida Initiative compared to U.S. support for Plan Colombia, and U.S. failure to understand the nature of Mexico’s violent crime.

The crisis blew up on February 22, when in an interview with El Universal, President Calderón stated that U.S. cooperation in the Mexican drug war is “notoriously insufficient.” He added that American diplomats have “done a lot of harm [Mexico-U.S. relations] with the stories they tell and that, in all honesty, they distort so as to impress their own bosses.” Calderón sees the failure to coordinate a serious problem among U.S. federal agencies, including the DEA, CIA and ICE. The reference to U.S. Immigration & Customs Enforcement did not mention that seven days earlier ICE agent Jaime Zapata was murdered while carrying out his duties on the road to San Luis Potosí. President Calderón had no niceties for Zapata’s death, but instead chose to blame the lack of coordination among U.S. agencies for the failure to reduce drug consumption and the increase of weapons moving southward.

U.S. Secretary for Homeland Security Janet Napolitano responded immediately to the accusations that U.S. agencies were failing to coordinate. On February 24, the White House confirmed an outstanding U.S. invitation to hold a presidential meeting in Washington. However, whether this summit can calm down the Mexican leadership and restore trust among senior officials on both sides of the border is yet to be seen. Can this meeting restore a constructive relationship necessary to engage on trade, energy, competitiveness, scientific research, immigration and security? (continue reading… )

Calderón Criticizes U.S. On Mexican Drug War Effort; Says Feds Not Doing Enough

Posted in News and Articles, Political Risk by politicalrisklatam on February 24, 2011

by Latin America News Dispatch, February 24th, 2011.

Mexican President Felipe Calderón criticized U.S. agencies Tuesday for failing to do their part in the fight against powerful drug cartels.

In his comments, from an extensive interview with the Mexican daily newspaper El Universal, Calderón said that the U.S. had failed to curb drug consumption or the flow of weapons into Mexico, even as it is sending $1.4 billion in training, equipment and other aid to help combat Mexico’s drug cartels.

Calderón also said that recently leaked cable from U.S. diplomats have hurt and distorted the relationship between the two nations and that the diplomats ”pour lots of cream on their tacos,” Calderón said, meaning they exaggerate, according to The Los Angeles Times.

The Mexican president also said that the U.S. Drug Enforcement Administration (DEA), the CIA and Immigration and Customs Enforcement (ICE) tried to outdo each other while all evading responsibility.

“The reality is that they don’t coordinate with each other, they’re rivals,” Calderón said, according to Reuters.

Calderón’s comments also coincided with Mexican marines discovering 72 sticks of commercial synthetic explosives at a camp in the southern state of Guerrero.



President Calderón Converses with Foreign Entrepreneurs and Investors in Mexico

Posted in News and Articles, Political Risk by politicalrisklatam on February 18, 2011

Press Release, February 16th,2011.

Mexican President Felipe Calderón received the 58 directors of firms with the highest foreign investment in Mexico in order to exchange points of view on various issues on the national agenda, mainly related to economic issues and security.

President Calderón stated that the decision by these firms to invest in Mexico reflects the strength and perspectives of its economy. He also detailed several elements of the agenda on which Federal Government is working to make Mexico a more competitive and safe country.

Economy secretary Bruno Ferrari García de Alba explained the advantages that the country offers productive investment, and the actions being carried out to improve the business environment. Among other indicators, he said that Mexico rose from 12th to 6th position as the most attractive destination for investment, according to the United Conference on Trade and Development (UNCTAD), World Investment Prospects 2009-2011. He added that between 2007 and 2010, according to AT Kearney’s Foreign Direct Investment Confidence Index 2010, Mexico rose from 19th to 8th position. These examples confirm Mexico as a solid investment destination, with an enormous potential for growth for conducting business.

Representatives of Federal Government’s Security Cabinet explained the record progress registered within the National Security Strategy, particularly as regards capturing criminal leaders, institutional reinforcements and reforms of the legal framework. At the same time, they stated that the authorities in the three orders of government and society as a whole must maintain a common front to achieve genuine, sustainable security. (continue reading… )


Mexico regulations: A competition law with teeth

Posted in News and Articles, Political Risk by politicalrisklatam on December 16, 2010

by The Economist Intelligence Unit, December 16th, 2010.

Mexico’s Senate has approved a more potent competition law, designed to enhance the powers of the government to combat anti-competitive practices and the monopolies that dominate many sectors of the Mexican economy. However, opposition senators softened the bill, first approved by the Chamber of Deputies in April, and it must be returned to the lower house for consideration, where its immediate prospects are uncertain.

Since taking office on 2006 the government of President Felipe Calderón has tried to take a stronger role in tackling public and private monopolies, which present a major obstacle to market competition in Mexico and hinder the economy’s overall competitiveness.

Since the existing Federal Competition Law (Ley Federal de Competencia Económica), was passed in 1992, powerful special-interest groups have backed the dominant market players (both public and private), and these groups have resisted giving the competition agency, the Federal Competition Commission (Comisión Federal de Competencia—Cofeco), a more robust role. Consequently, Cofeco rulings have tended to be cautious, though the agency has more recently begun to openly target industries with monopolistic characteristics.

The telecoms and oil industries are regularly at the centre of the reform debate. The telecoms sector is dominated by the flagship companies of Carlos Slim, a Mexican billionaire; these companies include Teléfonos de México (Telmex) in fixed-telephone lines and América Móvíl in mobile-telephone lines. In the oil sector, state-owned Petróleos Mexicanos (Pemex) controls the market and generates about one-third of government revenues. Other industries with monopolistic or duopolistic characteristics include television broadcasting (dominated by Grupo Televisa and TV Azteca), beer and soft drinks (Grupo Modelo and Fomento Económico Mexicano, respectively), and cement (Cementos Mexicanos). (continue reading… )

Mexico’s competition bill: all bark or more bite?

Posted in News and Articles, Political Risk by politicalrisklatam on December 6, 2010

by Ronald Buchanan for Financial Times – Beyond Brics, December 6th, 2010.

Mexico’s Senate is expected to vote as soon as Tuesday on a bill to promote competition in the economy. And a very good thing too, many might say. In fact, they already have, including President Felipe Calderón.

Many sectors, ranging from beer to television, not to mention telecommunications, are dominated by companies regarded officially as “dominant” by the government’s Federal Competition Commission. But the commission lacks the power of a genuine trust-buster.

More than a year ago, Mr Calderón launched a “decalogue” of radical changes for Mexico, which included a blast at the behemoths of the economy. No names were named, of course, but the implication was that fresh winds of competition were likely to face such magnates as Emilio Azcárraga Jean of Televisa, Latin America’s leading media group, Roberto Hernández, the tortilla king and banker, and, of course, the wealthiest of them all, not only in Mexico but the world, Carlos Slim.

Mr Slim is generally described as a telecommunications and retail magnate, but that includes only a part of his interests, which now include the construction of oil rigs for the state oil monopoly, Pemex, and more recently mining and real estate, soon to be spun off from his empire. (continue reading… )