December 16, 2013
Last week Mexico’s Congress approved a bill to end a seven-decade long state oil monopoly. In coming years foreign companies could invest as much as $20 billion a year in Mexico’s oil sector, thanks to new rules that will allow production sharing.
Although the energy reform bill, spearheaded by Mexico’s President Enrique Peña Nieto during his first year in office, has been vociferously opposed by Mexico’s left, the bill has the backing of Peña’s centrist PRI party as well as the right-of-center party of former President Felipe Calderon. Together the PRI and the PAN had enough votes to push the bill through Congress, where it was approved 353-134.
December 11, 2013
Global Post, 12/9/2013
Mexico’s economy will rebound in 2014 and grow 3.9 percent, compared to the 1.2 percent growth registered in 2013, insurer Credito y Caucion said in a report released Monday. “Mexico will be the exception in a changing pattern of growth in which the advanced markets will grow more while the emerging (markets) will continue leveling off” in 2014, Credito y Caucion said.
The company is a unit of Grupo Atradius, which operates in 45 countries. Mexico’s economy will rebound because of “its unique relationship with the United States,” the destination for nearly 80 percent of Mexican exports, Credito y Caucion said.
December 2, 2013
Los Angeles Times, 12/1/2013
To President Enrique Peña Nieto’s supporters, his first year in office has been a time of bold promises kept as he pursues an ambitious agenda of reforms designed, in the long term, to bring peace and economic growth to Mexico.
But in the short term, by many measures, his country remains a mess. Though he promised to focus on Mexico’s economic potential, Peña Nieto has presided over an economy that has hardly grown at all. Though he vowed to reduce the kind of violence that affects innocent citizens, his record has been mixed, with kidnappings and extortion rising nationwide even as the number of homicides drops.
December 2, 2013
USA Today, 12/1/2013
Peña Nieto arrived in office one year ago on Dec. 1, 2012, promising to calm the country and produce long-stalled structural reforms, which he said would allow Mexico to achieve 6% annual growth.
But Peña Nieto’s anniversary arrives amid a growing pessimism as the economy slumps, his agenda of structural reforms encounters resistance, and the security situation remains the same or worse in many places — prompting fed-up citizens in some areas to grab guns and organize vigilante groups.
November 27, 2013
Mexico’s recent tax overhaul does not do enough to curb the government’s dependence on oil revenue while other major reforms may not boost economic growth as much as authorities forecast, the International Monetary Fund said on Tuesday.
“With the prospect of declining oil production over the next decade, the federal government needs to beef up its collection on non-oil revenues,” the IMF said in a report on the fiscal reform that accompanied its so-called Article IV consultation with Mexican authorities.
November 15, 2013
The Wall Street Journal, 11/14/2013
In response to the economic slowdown this year, when gross domestic product is expected to grow just 1.2%, the Congress approved a fiscal deficit for next year equivalent to 3.5% of gross domestic product. This includes financed investment at state oil monopoly Petróleos Mexicanos for 2% of GDP. This year’s deficit is expected to be around 2.4% of GDP.
The infrastructure budget includes significant amounts for roads, ports, railways and water projects, as the government aims to give a boost to the struggling construction sector. Funds have also been earmarked for reconstruction, particularly in the southern state of Guerrero, which was hit hard by tropical storm Manuel in September.
November 4, 2013
Two weeks ago, President Obama called on Congress to turn its attention back to immigration reform. Lawmakers have instead found other things to keep themselves occupied–pillorying Kathleen Sebelius and the intelligence services, among them—and the prospects for immigration reform remain dim. For those who believe the U.S. should be encouraging more immigrants, not less, there’s a small silver lining to Congressional inaction. Although the proposed legislation would have had a considerable net benefit, it also might have ended one of the most innovative and economically effective migration policies America has: the diversity lottery. Now that reform efforts are on hold, lawmakers have a chance to preserve it.
November 1, 2013
The Latin American Herald Tribune, 10/31/2013
Mexico’s real gross domestic product (GDP) grew about 1 percent on an annualized basis in the third quarter, the Finance and Public Credit Secretariat said.
“The Mexican economy continued the process of expansion, according to the main macroeconomic indicators,” in the July-September period, the secretariat said in reports on the economy, public finances and the public debt submitted to Congress.
October 2, 2013
Los Angeles Times, 10/1/2013
Storms and insecurity are further eroding once-optimistic predictions for Mexico’s economic growth, analysts say. Mexico’s economy contracted in the second quarter for the first time in four years. The growth rate is more likely about 1.7%, the government says, or half the prediction of just 10 months ago — and a little less than half of last year’s pace. Some private economists put the current rate even lower.
September 16, 2013
The Financial Times, 9/14/2013
Mexican president Enrique Peña Nieto, under fire over tax proposals that herald pain for the middle class, has promised to accelerate spending of 27bn pesos ($2bn) on infrastructure, kick-starting access to credits and boosting the housing industry.
The move is an attempt to revive sluggish economic growth before the end of the year, and reveals the government’s concern with the economy’s sudden deflation. It grew just 1.5 per cent in the first half after shrinking 0.7 per cent in the second quarter, and official estimates of modest 1.8 per cent growth this year are looking optimistic at best.