1.This week President Peña Nieto announced cabinet changes for the Office of the Attorney General and the Public Administration Ministry. The incumbent head of the Attorney General’s Office, Arely Gomez, will now head the Public Administration Ministry while Raul Cervantes, who had previously been considered for Supreme Court Justice, will now lead the Attorney General’s office. Gomez gave a passionate speech at her swearing in ceremony after the Senate’s ratification were she vowed to be impartial and do her best to restore the public’s confidence in the government’s main anti-corruption institution. At the Attorney General’s office Cervantes, will be managing several high-profile cases that have dominated the office’s agenda since 2014, including the Ayotzinapa case, the extradition of El Chapo, and the open investigations against two former governors, Padres and Duarte.
2. For the first time in 18 months the inflation rate has surpassed the Bank of Mexico 3% target. The inflation rate for the first half of October rose to 3.09% and is primarily due to the depreciation of the peso and a rise in energy, gas, and electricity prices. Experts argue that the risk of increasing inflation due to the depreciation of the dollar is ameliorating and Citibanamex predicts that the annual general inflation for 2016 will reach 3.2%.
3.The international ratings agency, Fitch Ratings, announced this week that the fiscal burden that the federal government is placing on Pemex could lead to insolvency of the state-owned company. The agency explained that the tax burden that the Finance Ministry is putting on Pemex could only be sustained by a massive increase in debt for the company. Currently, Pemex pays 100% of its taxes with debt and the problem could become even more acute. Furthermore, the solvency of Pemex is also affected by the reduction of spending on investment which weakens the capacity for innovation and progress for the company. Fitch Ratings recognizes that the financial support that the government is providing is a step in the right direction but affirms that this will not be enough to make the company’s financial activities sustainable.
4. This week, 18 members of the right-wing National Action Party (PAN), published a public letter to the party leader, Ricardo Anaya, expressing their discontent with his leadership in particular with respects to the upcoming 2018 electoral process. The letter accuses Anaya of using his leadership position to get a head start for his own Presidential candidacy and prioritizing his personal project over the party’s interests. They demand Anaya to state whether he is going to seek the Presidential candidacy for the party in 2018 and if so that he should resign as head of the party to avoid conflicts of interest. In response, PAN’s National Executive Committee has created a commission to promote dialogue and unity within the party and to discuss the diversity of opinions regarding who should be party’s Presidential candidate. The party’s internal dispute escalated as the political deputy coordinator of the party’s parliamentary group, Eukid Castañon, resigned given disagreements with the parliamentary coordinator. Some analysts believe that the public showcasing of the internal dispute could be detrimental to the party’s image and their 2018 outcomes.