With 134 new stores in 2019, Walmart’s expansion was biggest in six years

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January 9, 2020

Most Walmart stores operate under the Bodega Aurrera brand.

Walmart mounted its biggest expansion in Mexico since 2013 last year, opening 134 new stores and boosting its presence in its largest foreign market by nearly 5%.

With 3,407 stores in the country, Walmart has more locations in Mexico than in any other country outside the United States.

Most of the stores are the Aurrera Bodega chain of supermarkets, including the smaller Bodega Express, no-frills units that are cheaper and faster to build than the brand’s larger formats.

The Bodega brand adheres to Walmart’s strategy of “Everyday Low Prices” and aims to compete with informal marketplaces and attract low-income shoppers.

Banorte equity analyst Valentin Mendoza said that informal markets are “where you find the great population mass that Walmart is going after.”

Analysts foresee Walmart maintaining its growth pace and generating more sales in new stores, but Mendoza said that such expansion could backfire on Mexico’s biggest retailer.

“Where is the ideal point where you can keep growing without cannibalizing the sales you already have?” he said.

Walmart saw record growth in Mexico in 2011 when it opened 365 stores.

But the following year it was hit with allegations of bribery and new growth slowed as a result.

The number of last year’s openings was the highest since 2013, when the company opened 214 stores in Mexico.

Walmart opened only 27 stores in all of Central America due to the region’s weak economy.

Walmart stores in Mexico open for more than a year saw sales rise 2.6% in December compared with that same month in 2018. The company’s total sales nationwide rose 4.1%.

Source: CNBC News (en)

Swimming, gym students accuse teachers of filming with hidden cameras

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Cody Copeland

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January 9, 2020

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graffiti messages — One graffiti message on walls of swimming pool threatens cutting off abusers' penises. Another says 'We know what you did.'

Female students at a preparatory school in Mexico City have accused their swimming and gym instructors of secretly filming them during classes in which they wear bathing suits and gym shorts.

Students at Preparatory School 9 of the National Autonomous University (UNAM) have been on strike since November 12 to demand that school authorities take strong measures in cases of gender violence against students and corruption.

With the school closed, the protesting students entered various office and in one they found a box of glasses with dark lenses that they claim teachers use to secretly film them.

“My teacher’s name is Luis. When I had my swimming and gym classes he used blue lenses,” said a female student who wished to remain anonymous. “In the physical education offices we found a box full of dark glasses and then we saw that they had cameras.”

“They used them when they had swimming classes with the girls, obviously minors in bathing suits, or in the gym, where it is mandatory for us to wear shorts.”

The students spray-painted the names of the accused teachers on the walls of the swimming pool alongside the phrase “We know what you did.”

Among their demands is that the university investigate a professor whom they accuse of corruption. Head of the biology department, he is known for taking monetary bribes to raise grades, students say.

School director Gabriela Martínez Miranda appeared in a video released on Tuesday in which she said that her administration had complied with the students’ list of demands.

“We have come to positive agreements, but there is still a point that is unresolved due to the fact that the students demand immediate punishment in the case of gender violence, even though they have not made a formal complaint. This is not possible. School legislation and the laws of our country require a complaint,” she said.

In light of the accusations service desks have been set up at which students can report cases of sexual assault and aggression. Such desks have also been set up at another preparatory school and the UNAM School of Philosophy and Letters for similar reasons.

In a press release, UNAM called for the striking students to return objects they have taken and allow regular classes to resume.

Source: Milenio (sp)

‘We saved Pemex,’ AMLO declares, but analysts have a different perspective

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MND Staff

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January 9, 2020

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López Obrador says production declines have been halted.

The federal government has “saved Pemex” and put an end to declining oil production, President López Obrador said on Wednesday, but some analysts have a very different view about the debt-laden state oil company.

“We already saved Pemex and petroleum production recovered [in 2019],” the president told reporters at his morning news conference.

“For the first time in 14 years, petroleum production didn’t fall, it was an extraordinary achievement due to the good management of Pemex,” he added.

López Obrador’s self-congratulatory remarks had a familiar ring: last month he declared that “we’ve got Pemex out of the crisis” and “we have stopped the fall in production, now they’re working on 20 [new] oilfields, output is increasing . . .”

However, analysts who spoke with the newspaper Financial Times disputed the president’s claims and agreed that a second ratings agency will likely downgrade Pemex to junk status after Fitch cut its rating to speculative grade in June.

The Times said that analysts indicated that the oil production targets for the company appear optimistic and that unless the cash-strapped government pumps in billions more dollars or drops its opposition to loss-making Pemex partnering with the private sector in exploration and production, “the outlook is bleak.”

López Obrador, a staunch opponent of the previous government’s energy reform that ended Pemex’s 80-year oil exploration and production monopoly, has put an end to new joint ventures known as farm-outs even though many analysts say that the move robs the state oil company of the opportunity to share investment risk with the private sector.

He said on Wednesday that there were no plans to hold new auctions to sell off oil fields to the private sector but added that his government is urging companies that won blocks previously to invest in them and produce.

“They’re only producing about 10,000 barrels [per day]; of 1.73 million barrels extracted yesterday, only 10,000 were extracted by the companies that received the contracts, the so-called energy reform was a resounding failure,” López Obrador said.

But the Mexican Association of Hydrocarbon Companies refuted the claim, stating that fields operated by its members yielded an average of 47,000 barrels per day (bpd) during the first 11 months of 2019 and that production was expected to rise to 280,000 bpd by 2024.

Graham Stock, a partner and senior sovereign strategist at BlueBay Asset Management, told the Times that the market generally believes that the strategy the government is pursuing to reassert Pemex’s dominance in the oil sector is the wrong one.

“There’s not really any light at the end of the tunnel,” he said.

Fausto Álvarez, a former senior official at the National Hydrocarbons Commission, the oil sector regulator, disputed López Obrador’s assertion that declining production at Pemex has been halted.

Output last year was actually set to decline 7.6% compared to 2018, he told the Times, adding that the new fields “will at best attenuate the decline but will not increase production.”

To meet its future production targets – 1.85 million bpd in 2020 and 2.4 million bpd by 2024 – the state oil company would need “a level of productivity and success that. . . [it] has never achieved,” Álvarez said.

The announcement last month of the discovery of a huge oil deposit in Tabasco that could yield 500 million barrels of crude – the largest find in 32 years, according to Pemex – was an attempt by the state oil company to convince ratings agencies that its future was secure, according to independent energy analyst Ramsés Pech.

However, Pemex – already saddled with about US $100 billion in debt – cannot escape from the fact that production costs are rising because many of its other fields are aging, meaning that achieving López Obrador’s aim of making Mexico self-sufficient in fuel production will be extremely costly.

The government is upgrading Pemex’s six existing refineries and building a new US $8-billion facility on the Tabasco coast that the president says will help Mexico achieve self-sufficiency, but analysts say that exporting crude makes better financial sense.

“So you have a Pemex for which producing costs more every day because of declining fields and if it puts [oil] into its refineries, it loses money,” independent analyst Rosanety Barrios told the Times.

Meanwhile, Pech has been advising senior government officials of the need to resume farm-outs. “There’s no other way. If they don’t, it won’t meet its targets and the rating agencies will come down on Pemex.”

If a second agency were to downgrade Pemex to junk status, there would be a massive sell-off of bonds by investors who are required to hold investment-grade debt.

Stock from BlueBay Asset Management said that “it’s not inconceivable” that the government will allow farm-outs to resume. Indeed, one unnamed senior government official said in August that López Obrador was poised to reverse his position and allow Pemex to enter into new joint ventures with the private sector in 2020.

But Stock also raised the possibility that the government could ignore the market expectation of another downgrade to Pemex’s credit rating and double down on its go-it-alone stance.

“Will this [the expectation of a downgrade] be taken as a sign the strategy isn’t working or will they come out fighting?”

Source: Milenio (sp), Financial Times (en)

Chiapas farmer turned weaver heads to New York Fashion Week

By

Leigh Thelmadatter

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January 9, 2020

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Designer and weaver López is off to New York.

It is not easy to buck tradition. The Los Altos region of Chiapas is Maya country where most people live in rural and traditional communities where the roles of men and woman are strongly delineated.

This is the case in the small Tzotzil community of Aldama, located in the municipality of Magdalenas. Here, weaving is strictly women’s work, with men toiling in the fields. At least that used to be the case.

In 2014, Alberto López Gómez decided to challenge traditional thinking. He was 25 and until that point had followed his culture’s expectations. But then he decided to change his life.

“It took me a while to tell my mother that I wanted to learn to work on a backstrap loom. She was surprised because no man had ever done this, but she supported me from the first moment,” López told the newspaper El Universal.

That initial support was not widespread. He had to deal with disapproving stares and being told over and over that his place was the fields. “They criticized me because they did not want to see a man weaving. But I tried not to listen.”

Every day at 6:00am he got up to weave for as many as 14 hours at a time, allowing him to hone his technique. Later he moved to tourist destination of San Cristóbal de las Casas where he established his own business. Here, over 130 Tzotzil artisans bring their textiles where they can get fair prices and be treated with respect.

Six years later, his talent and perseverance have paid off. López is slated to present his work and that of his community at Harvard University and New York’s prestigious Fashion Week. At the end of January he will travel to Boston to give a talk about the cosmology found on traditional Tzotzil huipils, the square or rectangular garments common in central and southern Mexico and are often highly decorated with woven and/or embroidered patterns. These designs are linked to the traditional beliefs and customs of a location.

At the beginning of February, the farmworker turned weaver will present as a designer a line called K’uxul Pok, which he has created along with 150 women weavers from his region. He considers this event an important opportunity to promote the traditional textiles of his region in the world of fashion.

The invitation came after a video created by a human rights network went viral online. Both Harvard and Fashion Week are covering López’s travel expenses.

The work is seen as being important because violence has increased in the area in the last three years, and promoting the work of someone like López encourages people to be proud of their region. In an interview, Adriana Pavón, a fashion consultant with ties in both the U.S. and Mexico, finds it interesting that it is foreigners who take a greater interest in and have a greater appreciation for traditional Mexican handcrafts.

“. . . unfortunately, in Mexico we have not yet taken the our cultural and intellectual talent seriously. It is important to create binational (U.S.-Mexico) ties with the aim of supporting and growing our local talent.”

López, meanwhile, not only weaves and sells huipils, he further defies conventions by wearing them as well.

He continues to work against the notion that weaving (and other textile work) belongs only to women. In a recent post to his Facebook page he stated that “My goal is to let people know about my work and the work of my associates, even though people sometimes are envious or critical. I learn much being able to give my associates encouragement.”

Source: Megamedia (sp), El Universal (sp)

Year-end inflation drops to second lowest level ever recorded

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MND Staff

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January 9, 2020

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Governor Díaz: bank prepared to ease rates again in February.

Inflation fell to its second lowest end-of-year rate ever in December, adding to expectations that the central bank will continue to cut interest rates this year.

The national statistics agency Inegi reported Thursday that consumer prices rose 2.83% in December compared to the same month a year earlier. The figure is 2% lower than the 4.83% inflation rate recorded in December 2018.

Lower pressure on prices for some agricultural products – such as chicken, avocados, oranges, limes and serrano peppers – and energy products drove the decline in inflation compared to November when the rate was 2.97%, Inegi said.

The only occasion on which the year-end rate was lower was in December 2015 when inflation fell to 2.13%. The 2.83% rate is the lowest for any month since August 2016 when consumer prices rose 2.73%.

The inflation rate in December was within the Bank of México’s target range for the seventh consecutive month. The central bank targets 3% annual inflation with tolerance of 1% in both directions.

The core price index, which doesn’t consider some volatile food and energy prices, rose 3.59% in December, Inegi reported, the smallest increase in nine months. The non-core index, which monitors products whose prices are most susceptible to fluctuations, increased 0.59% in December, the lowest increase ever recorded.

Among the products whose price increases in December exceeded the inflation rate were tomatoes, onions, airline tickets and LP gas.

Lower inflation and a stagnant economy have led many analysts to predict that the central bank will cut rates for a fifth consecutive time at its board meeting in February. The last cut came on December 19 when the bank’s benchmark rate was reduced by a quarter point to 7.25%.

Bank of México Governor Alejandro Díaz de León said on December 23 that the bank was prepared to ease rates again in February if inflation and internal and external risks remain low.

Source: El Financiero (sp)

26 bags of body parts found in ravine in Tonalá, Jalisco

By

Cody Copeland

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January 9, 2020

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The area in which bags of human remains were found in Jalisco.

After a gruesome discovery on Tuesday of 14 plastic bags of human remains, search efforts turned up another 12 bags Thursday in a ravine in Tonalá, Jalisco, the state Attorney General’s Office reported.

The bags were found by the Santiago River, near the highway to Mazatlán.

The Attorney General’s Ofice has yet to determine how many bodies the bags might contain, as analyses of the remains are still in the initial stages.

The newspaper Reforma reported that experts were having trouble identifying the remains and determining the cause of death due to the advanced state of deterioration of the body parts.

During the 12 months ending November 30, 62 secret graves were found in Jalisco, yielding 156 bodies and the remains of another 50 people. Many other body parts were found in the graves but it has not yet been determined how many bodies they might represent.

Source: Reforma (sp)

New health scheme touts free universal care but the reality is different

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MND Staff

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January 9, 2020

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The hospital in Chalco was one of those where patients have been charged for medicine.

It has been touted as completely free but a week after the federal government’s new universal healthcare scheme went into effect, patients are finding a very different reality.

The National Institute of Health for Well-Being (Insabi), a new government department tasked with providing medical services to millions of Mexicans without insurance, started operations on January 1.

A week later, the newspaper El Universal found that patients at the General Hospital in Mexico City, two healthcare centers in Nezahualcóyotl, México state, and the Chalco General Hospital in the same state have had to buy their own medicine and medical supplies such as gauze, rubbing alcohol and ointments even though the Insabi website states that beneficiaries of the healthcare scheme will receive free treatment “without restrictions.”

Some patients who qualify for the Insabi program because they are not covered by the IMSS and ISSTE social security schemes have also been charged daily rates as high as 3,000 pesos (US $160) for their hospital stays.

One person who has been charged for his treatment is Óscar Quintana, a diabetes patient who was admitted to the General Hospital in Mexico City on January 2 after experiencing extreme pain in his left foot.

“They’ve charged us for everything,” family member Alma told El Universal.

“[They charged us for] the emergency care, the healing material – they sent us to buy antibiotics and [other] medicine. For a day in hospital, it’s 450 pesos [US $24] when before it was just over 200. We’ve spent almost 5,000 pesos in the past days. I wonder when free care will be a reality . . .” she added.

Another patient at the General Hospital in the capital is Ángel López, a young man who was hit by a car on January 5. His family is currently trying to raise 45,000 pesos (US $2,400) so that he can undergo the surgery he requires.

The man’s aunt said that her nephew was first taken to a hospital in Zumpango, México state, where he was admitted after showing that he was covered by Seguro Popular – the insurance program the new Insabi scheme is designed to replace.

“. . . They accepted the policy but for two days during which they didn’t do anything to him, they charged us 6,000 pesos,” Angélica Pérez said.

“Then they transferred him to the General and the doctors said they needed a pin to operate on him; [they said] they had it here but we would have to pay 25,000 pesos [for it] plus 20,000 for the operation,” Pérez added.

At a healthcare center in México state, Chalco resident Karla Cárdenas told El Universal that she brought her young son in after he fell and suffered a cut beneath one of his eyebrows. She said the staff told her that they could treat her son but didn’t have the necessary materials.

“[Buying the materials] is not expensive but I think I could provide the same [treatment] at home. What I needed was to know if my child needed stitches and fortunately they said that he didn’t. I don’t know how Insabi works but I hear the president saying every day that the care is free and that the medicine is as well but . . . [at] the hospital they tell you that they don’t have any so who do you believe? The care is good, you can see that the people are committed [to their work] but how can they do it if they don’t have what they need?”

Back at the General Hospital in Mexico City, Guerrero resident Angélica Durán had a different experience, telling El Universal that she hadn’t been required to pay for any of her treatment, which included blood tests and an ultrasound.

“They haven’t charged us anything. I came because I had a pain in my stomach that was so strong that I couldn’t even walk. We went to a hospital in Guerrero but they sent us here, they told us that they would attend to us for free and that’s the way it’s been,” she said.

However, at least among the people who spoke with El Universal, Durán’s experience is unique.

In response to complaints from patients and family members who had to pay for hospitalization, treatment, medicines and supplies, Insabi clarified that medical care is only free at primary and secondary healthcare facilities, and not at specialist, tertiary hospitals.

“In relation to the questions that have arisen due to the charging of fees at national health institutes and federal hospitals, Insabi provides [free] medical services at the primary and secondary level of care to all people who don’t have social security. In accordance with article 36 of the General Health Law, national health institutes and federal hospitals are subject to obtaining fees. . . for providing tertiary level services,” the National Institute of Health for Well-Being said.

The statement doesn’t, however, explain why patients at healthcare centers in Nezahualcóyotl, for example, were required to pay for medicines and supplies.

Insabi also addressed uncertainty among people formerly covered by Seguro Popular with regard to how to access its free services.

The institute said there is no need to enroll in the scheme prior to receiving medical treatment, explaining that the registration process will be completed by staff at the healthcare facilities where people seek care.

Source: El Universal (sp)

Police confuse family with bad guys, killing 2-year-old

By

Cody Copeland

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January 9, 2020

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Police in Zaragoza, Coahuila, killed a two-year-old girl and wounded her parents and sister when they confused the car they were traveling in with that of criminal suspects.

The incident occurred at 4:20pm on Wednesday as Rafael Vázquez Muñiz, 34, drove home with a 21-year-old woman believed to be his wife and their three daughters.

But police said they confused their black Saturn with the vehicle of suspects who had threatened to kidnap a senior Zaragoza police officer, and opened fire.

The victims were taken to a hospital in the neighboring town of Allende for treatment, but the two-year-old died there as a result of a gunshot wound to the neck.

The two officers were arrested.

The Coahuila Human Rights Commission opened an investigation into the girl’s death.

Sources: El Universal (sp), Vanguardia MX (sp), Sin Embargo (sp)

LeBarón: attorney general asked for public’s help to pressure lawmakers

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MND Staff

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January 8, 2020

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Julián LeBarón, front left: law protects criminals. — Julián LeBarón, front left: laws protect criminals.

Mexico’s justice system leaves citizens “defenseless” against crime, according to a relative of the nine members of the Mormon family murdered in Sonora in November.

After a meeting with federal Attorney General Alejandro Gertz Manero, anti-violence activist Julian LeBarón said in a radio interview that “it seems that laws protect criminals more” than citizens.

He also said that Gertz Manero asked him and other members of his family to issue a call for citizens to join forces to pressure lawmakers to change existing laws to build a stronger law enforcement and justice system.

“The attorney general told us that they have serious problems in the whole country, he told us that 33 million crimes were committed in 2019 and that the laws don’t give police the instruments to do their job,” LeBarón said.

“[He told us] that we need to organize social pressure so that we get the tools, the powers, that they need to bring criminals to justice,” he added.

LeBarón, who called on citizens to “take up the battle” against organized crime at an anti-violence rally in Mexico City last month, said that Gertz Manero described crime as “a serious problem” that successive governments haven’t been able to stop.

He added that the attorney general said that “the underlying laws” of the justice system – which was overhauled during the administrations of the past two federal governments but has been plagued by problems – need to be changed.

“A lot needs to be done but if he [Gertz Manero] is asking us for help, he’s confirming what we said: the political class won’t provide the solution . . . they haven’t given us the instruments so that the citizens can defend life, we’re left defenseless with the justice system,” LeBarón said.

He also called for the Chihuahua government to be investigated in connection with the massacre of three women and six children in Bavispe, Sonora, on November 4 because police from that state were in the area but didn’t respond to the attack.

Chihuahua Attorney General César Augusto Peniche refuted LeBarón’s claim, replying that state police did attend the scene of the crime.

“We have evidence that they did arrive . . .with Federal Police officers [stationed] in Chihuahua,” he said.

Seven people have been arrested in connection with the attack allegedly perpetrated by La Línea, a criminal gang with links to the Juárez Cartel.

One of the suspects is the chief of police of Janos, Chihuahua, who was taken into custody in late December.

Investigations have led authorities to believe that Fidel Alejandro Villegas Villegas could be an active element in the La Línea gang and that through his influence and staff he procured protection for members of the organization.

Source: Milenio (sp)

Automotive production took a tumble in 2019

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MND Staff

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January 8, 2020

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Automotive production declined 4.1% in 2019 compared to the previous year, while vehicle exports fell 3.4%, according to official data published on Wednesday.

The national statistics agency Inegi reported that automakers manufactured just over 3.75 million vehicles in Mexico last year, the lowest number since 2016 when 3.46 million units rolled off production lines.

The General Motors strike in the United States between September 15 and October 25 and lower domestic production by Ford due to the changing of equipment at its Mexico plants were among the factors that caused the decline.

Exports fell to 3.33 million cars in 2019, Inegi said, the first annual decline since 2009 although above the 3.25 million units sent abroad in 2017. About 80% of exports went to the United States, the only country to which Mexico sent more vehicles in 2019 than the year before.

Lower global demand for new cars was also reflected in Mexico, where sales declined 7.7% last year to 1.31 million. The figure is the lowest in five years and indicative of a weak Mexican economy that entered a light recession in the first half of 2019.

The automotive production and export figures were even worse in December. Auto output fell 12.7% to 208,073 vehicles and exports slumped 16.7% to 229,227 units.

The signing of a revised version of the new North American free trade agreement last month does, however, provide greater certainty for the Mexican auto industry and could help it recover in 2020.

Source: Reuters (sp)