Infrastructure, Drug Lords and Reform Proposals in Mexico – Weekly News Summary: July 19

Coffee by Flikr user samrevelThe Mexico Institute’s “Weekly News Summary,” released every Friday afternoon summarizes the week’s most prominent Mexico headlines published in the English-language press, as well as the most engaging opinion pieces by Mexican columnists.

What the English-language press had to say…

This week’s most important headline was the capture of Miguel Angel Treviño MoralesZ40 head of Zetas Cartel and one of Mexico’s most brutal drug lords. The capture of Mr. Treviño is the first arrest of a top cartel leader since Mr. Peña Nieto took office. During the capture, a navy helicopter intercepted the truck which Mr. Treviño was riding. The capture may have remarkably weaken Zetas, a cartel Mr Treviño Morales is believed to have controlled for about eight years, however, other Mexican cartels such as the Sinaloa and Caballeros Templarios remain powerful.

 

On the economic front, last Monday, President Enrique Peña Nieto launched a $102 bn investment plan aimed to improve Mexico’s transportation and telecommunications infrastructures during his six-year term. According to The Financial Times, Mexico brought out the Bazooka, a bazooka that according to the newspaper, many have been waiting for after the worse-than-expected start to the year of the Mexican economy. Economists had been counting on a pick-up in government spending to help pick up the slack. Reuters reported that government’s plans might include two new satellites to be put in orbit, a tender process for two new national television networks and 15 new highways. One of the downsides of the proposal is that the government did not commit to building a new airport for Mexico City.

One week after the local elections took place in Mexico, opposition parties again threaten to walk away from the Pact for Mexico. Last Sunday, in a joint press conference, PAN and PRD chairmen denounce the PRI for not complying with prior calls to reinforce security during the elections but said they would remain in the pact if their conditions, aimed at cleaning up elections, were met. In exchange for remaining in the pact, Madero and Zambrano asked the government to perform an “exhaustive” investigation into the July 7 elections

Regarding the reforms agenda, Mexico’s opposition National Action Party plans to present an energy reform proposal seeking constitutional changes to open the state-owned oil company PEMEX to more competition. The PAN’s announcement surprised since it was announced before the proposal expected to be made by the President Enrique Pena Nieto, who said last month his plan would be presented in September.

What Mexican columnists had to say…

This week, after most of the results of July 7th elections are known, columnists analyzed the impact of such results on the Pact for Mexico. Jose Antonio Crespo in his weekly op-ed argued that now that elections are over, there are still some other potential threats to the Pact: new demands by the opposition regarding the political and energy reforms and potential protests in the streets led by left-parties supporters. Jorge Fernández Menéndez argued that even when Jesus Zambrano and Gustavo Madero have five conditions to continue in the Pact for Mexico, in reality those conditions can be summarized in one: to discuss the political reform before the energy and fiscal ones.

Talking about the energy reform, Denise Dresser wrote this week that Mexico has been stuck in the same place in the IMCO’s Competitiveness Index for more than a decade because there are no proper conditions for the economy to take off. Referring to the same index, Leonardo Curzio pointed out that Mexico has not been able to improve its competitive status relative to similar countries. According to the author, we are in many ways a stagnated country and the obvious question to make is why? Sergio Sarmiento referred to the recent comments of Marcelo Ebrard setting Saudi Arabia and Kuwait as good examples of how to run the oil industry in a country. Even when following such examples, Sarmiento argues, Mexico would have to make constitutional reforms in order to achieve their degree of openness. Finally, Ciro Gómez Leyva wrote about the recent announcements of PAN’s energy reform proposal arguing that in essence, the goal of Madero and the PAN is the same as the government and the PRI.

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