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Mexican presidency: second-year slump

Tuesday, April 22, 2014


Times are tough for Mexican President Enrique Peña Nieto, whose popularity last month stood at 37 percent nationally, compared to 55 percent a year earlier, according to the GEA-ISA consultancy.

The numbers are even worse among businesspeople.

Nearly 90 percent of respondents characterized the government’s management of the economy as mediocre to bad, in KPMG’s annual Perspectives of Senior Management poll.

A year earlier, 61 percent of leading businesspersons rated Peña’s performance as good or excellent.

The main problem is that most Mexicans are worse off than they were in 2012, when Peña was elected.

Economic growth was just over 1 percent in 2013, while the price of a basket of basic goods and services has gone up three times as much.

Peña in addition is struggling to implement two big reforms, which he promised in his election campaign.

The Mexican Congress has not yet agreed on regulations, which would promote increased competition in the info-communications sector.

Currently, Carlos Slim’s America Movil controls three quarters of Mexican landline telephony, and two thirds of mobile services.

Meanwhile, Emilio Azcarraga’s Televisa dominates television broadcasting.

Peña’s plan calls for no single group controlling more than half of either sector.

A deadline for approving regulations for energy reform has likewise been missed.

Earlier this year, Congress passed laws, which would open the country’s 76-year old oil-gas monopoly to private investment.

But without regulations, investors have no way of knowing the conditions, under which they could explore and develop potential resources.

One option is to let private companies develop projects on their own.

Another would let state-owned Pemex continue as the sole owner of drilling projects, while subcontracting various operations to private companies.

Peña’s Institutional Revolutionary Party has no majority in either house of Congress.