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San Juan Ozolotepec, Oaxaca, took the brunt of Tuesday’s earthquake

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Earthquake damage in San Juan Ozolotepec, Oaxaca.
Earthquake damage in San Juan.

At least 200 buildings were damaged in the mountain municipality of San Juan Ozolotepec, Oaxaca, in the 7.4-magnitude earthquake that rocked southern and central Mexico on Tuesday morning, officials report.

The region was the hardest hit by the quake, which left three of its residents dead, scores of homes uninhabitable and a church and medical clinic on the verge of collapse. 

Dozens of people have had to leave their homes due to structural damage, and landslides on the highway temporarily blocked access to army and National Guard disaster relief crews.

“Right now the report that we have is of material damage, many houses were demolished, they have many cracks, people will no longer be able to inhabit them,” said Mayor Francisco Reyes.

The region is no stranger to earthquakes, including the 8.1-magnitude temblor in 2017, but residents of San Juan Ozolotepec, where 99.5% of the population live in poverty according to federal statistics, said that Tuesday’s quake felt much stronger, as they struggle to contend with the damage and numerous aftershocks.

Soldiers outside the Cathedral of the Mountains in San Juan.
Soldiers outside the Cathedral of the Mountains in San Juan Ozolotepec.

Due to the town’s location, cell phone coverage is spotty at best, and after the quake some residents climbed hills trying to get cell phone service to plead for help.

Several ranches and small settlements remain cut off due to rubble-covered roads as rescue crews set out on foot to try to reach them and offer assistance.

The National Seismological Service placed the quake’s epicenter at two kilometers outside La Crucecita, Oaxaca, some 175 kilometers from San Juan Ozolotepec, but the tremor was felt in several states.

Both the epicenter and the magnitude of the quake have been revised. It was initially reported to be 23 kilometers from La Crucecita with a magnitude of 7.5.

The death toll has also gone up as another six bodies have been recovered since Tuesday.

“At the moment 97 municipalities reported damages in the states of Oaxaca, the state of México, Mexico City and Veracruz. There are two temporary shelters active in the state of Oaxaca, where a total of 38 people have sought shelter,” Civil Protection officials reported yesterday.

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“Unfortunately there are reports that 10 people have died and 21 are injured in Oaxaca, and in Mexico City two injures were reported.” 

Throughout Oaxaca, more than 2,000 structures were damaged, including 15 hospitals and medical clinics, as well as four hospitals and two churches in Veracruz.

Source: Reforma (sp), Milenio (sp), La Razón (sp), Diario Marca (sp) 

With 5,437 new cases, Mexico’s coronavirus numbers closing in on 200,000

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Coronavirus cases by state, as of Wednesday.
Confirmed coronavirus cases by state, as of Wednesday. milenio

More than 5,000 new Covid-19 cases were added to Mexico’s tally on Wednesday, increasing the total to close to 200,000, while almost 1,000 additional fatalities lifted the death toll above 24,000.

The federal Health Ministry reported 5,437 new cases at Wednesday night’s coronavirus press briefing, increasing the total number of cases detected to 196,847.

Mexico has now passed Germany to rank 12th in the world for total case numbers, according to data compiled by the Johns Hopkins University.

The 11 countries that have recorded more cases than Mexico are, in order: the United States, Brazil, Russia, India, the United Kingdom, Peru, Chile, Spain, Italy, Iran and France.

The Health Ministry also reported 947 additional Covid-19 fatalities, increasing the official death toll to 24,324.

The daily tally of coronavirus cases and deaths.
The daily tally of coronavirus cases and deaths. Deaths are numbers reported and not necessarily those that occurred each day. milenio

Mexico has the seventh highest coronavirus death toll in the world after the United States, Brazil, the United Kingdom, Italy, France and Spain.

Based on confirmed cases and deaths, Mexico’s fatality rate is currently 12.3, well above the global rate of 5.1.

In addition to the more than 24,000 confirmed deaths, 1,894 fatalities are suspected to have been caused by Covid-19.

Director of Epidemiology José Luis Alomía said that 24,036 coronavirus cases – 12% of the total – are currently active, a decrease of 351 cases compared to Tuesday.

He also said that there are 62,475 suspected cases across the country and that 515,658 people have been tested for Covid-19.

Mexico City remains the country’s coronavirus epicenter, with 3,639 active cases, according to official data.

Covid-19 deaths as of Wednesday.
Covid-19 deaths as of Wednesday. milenio

México state, which includes a large number of municipalities that are part of the greater Mexico City metropolitan area, has the second largest active outbreak, with 2,557 cases.

In the middle of April, Deputy Health Minister Hugo López-Gatell presented an epidemiological model that predicted that the coronavirus epidemic in the Valley of México metropolitan area would be virtually over by June 25 with 95% of cases having been recorded.

The model predicted that the peak would occur between May 8 and 10 and that the Valley of México coronavirus epidemic would end in August.

However, there is now no clear end in sight even though health officials have said that the spread of the virus is stabilizing in the Mexico City area. Active cases did decline in Mexico City on Wednesday compared to Tuesday but increased in México state.

However, a lack of widespread testing inevitably means that many coronavirus cases go undetected, especially mild and asymptomatic ones.

The capital and México state are among the 15 federal entities that are still under “red light” restrictions because the risk of coronavirus infection is deemed to be at the maximum level.

Active cases of Covid-19
Active cases of Covid-19. milenio

After those two entities, Puebla has the largest active outbreak in the country, with 1,841 cases. The state capital is a clear coronavirus hotspot, with 1,547 active cases, more than double the number in León, Guanajuato, which ranks second at a municipal level for active cases.

Four other states have more than 1,000 active Covid-19 cases. They are Guanajuato, Tabasco, Veracruz and Tamaulipas.

Every state in the country has at least 100 active cases, while only three – Colima, Chihuahua and Zacatecas – have fewer than 200.

Mexico City also leads the country for Covid-19 deaths, having recorded 5,938 confirmed fatalities as of Wednesday. México state ranks second, with 3,711 confirmed deaths.

Four other states have recorded more than 1,000 coronavirus-related deaths: Baja California, with 1,813; Veracruz, with 1,373; Sinaloa, with 1,126; and Puebla, with 1,024.

Four states – Colima, Baja California Sur, Zacatecas and Chihuahua – have recorded fewer than 100 deaths.

At a municipal level, the densely-populated Mexico City borough of Iztapalapa leads the country for Covid-19 fatalities, with 1,039 as of Wednesday.

Even as Covid-19 case numbers and the death toll continue to show steady growth, Mexico’s health system is not currently overwhelmed with coronavirus patients.

National data presented by the Health Ministry on Wednesday night showed that 45% of general care hospital beds set aside for coronavirus patients are currently occupied while 38% of those with ventilator are in use.

Some states have higher hospital occupancy levels but none exceed 70% for either general care or critical care beds.

Source: Reforma (sp), El Financiero (sp), Milenio (sp) 

Judge orders definitive suspension of train construction due to virus

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An artist's conception of the Maya Train station in Palenque, Chiapas.
An artist's conception of the Maya Train station in Palenque, Chiapas.

A federal judge has once again ordered the suspension of the Maya Train project in Palenque, Chiapas, due to coronavirus concerns.

Lucía Anaya Ruiz, a judge in Tuxtla Gutiérrez, issued a definitive suspension order to Mayan residents of the Chiapas municipalities of Palenque, Ocosingo and Salto del Agua.

One of the stations on the 1,500-kilometer railroad will be located in Palenque, a city best known for its archaeological site of the same name, but tracks won’t run through the other two municipalities where the plaintiffs live.

In granting the suspension order, Anaya said the deployment of a large number of construction workers to Palenque could place local residents at risk of being infected with the coronavirus.

While the virus remains a threat, the National Tourism Promotion Fund (Fonatur), which is managing the Maya Train project, is only permitted to carry out maintenance work on existing tracks in Palenque, the judge ruled.

Chiapas, where there are currently 357 active Covid-19 cases, was allocated a “red light” on the federal government’s most recent stoplight map to assess the risk of coronavirus infection, meaning that most nonessential activities remain suspended.

Construction is now considered an essential activity across Mexico but the judge deemed that fact insufficient to allow the Maya Train project to proceed in Palenque.

Anaya last month issued a provisional suspension order that stopped the project in Palenque due to coronavirus concerns but it was revoked in late May by judges who noted that construction as well as mining and the manufacture of transportation equipment were officially declared essential activities on May 13.

An administrative court will also review the definitive suspension order but a decision on its validity is expected to take weeks.

In the meantime, Fonatur mustn’t allow the companies awarded the contract for the section of track between Palenque and Escárcega, Campeche – Portugal’s Mota-Engil and the majority state-owned China Communications Construction Company – to complete any construction work in the former municipality.

Fonatur appeared unconcerned about the ruling, noting that no new construction work is underway in Palenque and that it doesn’t prevent maintenance from being carried out on existing tracks.

It also highlighted that the suspension order will only remain in effect while Covid-19 remains a threat to people’s health.

Construction on some other sections of the US $8-billion rail project was officially inaugurated by President López Obrador at the start of June.

He pledged that the project will be finished by October 2022 and create more than 200,000 jobs by the end of 2021.

Source: Reforma (sp) 

Security forces apprehend Santa Rosa cartel founder

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El Puma, left, and El Marro.
El Puma, left, and El Marro. The former has been captured; the latter may be next.

The founder of the Santa Rosa de Lima Cartel, a Guanajuato-based fuel theft and drug gang, was arrested on Tuesday in San Luis Potosí, the Defense Ministry (Sedena) said.

Noé Israel Lara Belman, known as “El Puma,” was detained in a joint operation by the army, the National Guard and the federal Attorney General’s Office.

The Defense Ministry said that a warrant had been issued for Lara’s arrest on charges of fuel theft and organized crime. He is considered one of the main generators of violence in Guanajuato, Sedena said.

The arrest of El Puma followed the capture of his two brothers, Fabián Lara Belman and Luis Ángel Lara Belman, earlier this year.

All three brothers were once close to José Antonio “El Marro” Yépez, the leader of the Santa Rosa de Lima Cartel and one of Mexico’s most wanted men.

However, El Puma is believed to have had a falling out with Yépez at the end of last year and as a result decided to leave Guanajuato.

His arrest came just three days after El Marro’s mother, sister and cousin were arrested in Celaya, Guanajuato. The three women were allegedly responsible for paying wages to cartel members and associates.

Yépez made an appearance in a video posted to social media after their arrest in which he raised the possibility of entering into an alliance with other criminal groups, presumably because so many of his own operatives have been detained.

Federal and Guanajuato authorities launched an operation to capture El Marro more than a year ago but the criminal leader has evaded arrest even as the walls appear to be closing in on him.

Source: Reforma (sp) 

Bank says 600,000 businesses at risk of closing for good due to virus

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Percentages of closures of micro-small, medium and large businesses in the formal sector
Percentages of closures of micro-small, medium and large businesses in the formal sector in April and May this year compared with the 2008-09 financial crisis.

More than 600,000 formal and informal sector businesses are at risk of closing permanently due to the coronavirus pandemic, according to the bank BBVA.

The bank’s research division said that according to a survey conducted by the national statistics agency Inegi, 311,000 formal sector businesses and 313,000 informal sector ones are currently closed due to coronavirus restrictions and therefore have no income.

Reopening is likely to be difficult for a lot of them.

Given the large number of such businesses, it is “very probable” that permanent closures due to the pandemic will increase, BBVA Research said.

According to the Mexican Social Security Institute, just under 10,000 formal sector businesses were forced to close for good in April and May as a result of the coronavirus crisis, while Inegi found that almost 12,000 informal sector businesses have also closed permanently due to the pandemic.

BBVA Research predicts that those figures will rise in the coming months even as Mexico takes tentative steps to reopen the economy.

Employees who lose their jobs will cause unemployment to rise, BBVA Research said, noting that some formal sector workers will try to find employment in the informal economy.

Most of the businesses that will close will be very small ones. Of the more than 300,000 formal sector businesses currently closed, 81% are so-called micro-businesses while in the informal sector, the figure is 98%.

BBVA also noted that about 1 million formal sector jobs have already been lost as a result of the pandemic and predicted that the labor market will not recover until 2024 at the earliest.

It said that jobs recovery will be held back by the coronavirus-induced economic downturn, the uncertainty surrounding the economic reopening, and the lack of government support.

The bank highlighted that the tourism and construction sectors have recorded the biggest declines in employment.

Gabriela Soni, chief investment officer of financial company UBS México, told the newspaper El Financiero that the number of jobs lost between March and May – some 1.03 million – is triple the number created in all of 2019.

She said that was “concerning” but added that the new North American free trade agreement, set to take effect on July 1, could help to boost employment. Soni said that the United States-Mexico-Canada Agreement will particularly benefit the manufacturing sector.

“When the United States starts to demand products, we have to produce to export them,” she said.

However, with the United States – and the world – also going through an economic crisis, demand for a lot of consumer goods is likely to remain below pre-pandemic levels for months if not years to come.

While demand for Mexican-made products remains low in the United States, Mexico’s biggest trading partner, the economy’s ability to recover will remain hamstrung.

According to a new growth forecast published Wednesday by the International Monetary Fund, Mexico’s economy will contract 10.5% in 2020, a decline of 3.9% compared to its April prediction.

Source: El Financiero (sp) 

Tire clamps a welcome measure in a generally lawless landscape

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A traffic cop eyes a double-parked car in Oaxaca city.
A traffic cop eyes a double-parked car in Oaxaca city. The cop is a rare sight but the double-parked car is not.

I won’t lie: I smirked throughout pretty much the entire reading of the story about the municipality of Metepec deciding to crack down on nonchalant and deceitfully oblivious motorists. Did you hear?

Parking violators will have an actual tire clamp or boot put on their car so that they can’t move it, then will have to pay a fine of 435 pesos (about US $19) within two hours; otherwise, it gets towed and the driver must pay to get it out of the pound. Youch!

Few things about city life in Mexico trigger my contempt as quickly as people leaving their cars where they know they shouldn’t. Then they feign ignorance regarding the way they’ve blocked traffic — vehicle, foot or both, shut someone in, or have been extremely close to causing an accident, and I find myself trying hard to achieve both a scowl and an eye-roll to demonstrate my disapproval (one of my pettier and less-charming features, I know).

There are a lot of things about traffic here that both annoy and terrify me, as I’ve mentioned before. Poor infrastructure combined with a generally lawless landscape when it comes to driving make for way more adventure than I’m typically up for, not to mention the real safety issues that arise from so little enforcement.

To begin, however, I feel the need to put some things out there that actually are not the fault of drivers themselves:

First, the infrastructure of nearly all of our communities (save Orizaba, maybe) really is not made to help people follow the traffic and parking rules in most circumstances. I’ve said it many times before: if you want people to “choose” to behave the right way, you have to make it so that it’s easy to choose to behave the right way.

This is very difficult if, say, you have a large park where families arrive every Sunday in their cars. As there’s no proper parking, residential streets end up being lined on both sides. I imagine that in addition to really annoying the neighbors who’d thought they were investing in a tranquil and convenient neighborhood, it makes everyone feel crowd-stressed and likely causes more than a few accidents when people are trying to get through both ways on a street that suddenly has space for only one car at a time.

Throw on top of that the many houses and apartments that were built with absolutely no consideration for the possibility that the inhabitants might own even one car, and you’ve got congestion at worst, concrete-filled bucket “place savers” at best.

Another issue is the sheer number of cars in most communities nowadays, certainly an issue in Metepec. As the standard of living has generally increased, so has car ownership, and our communities simply haven’t been able to keep up with the growth. We’ve collectively got so many cars now but few places to put them!

So they get left on the street, on sidewalks, or pretty much anywhere they can be reasonably expected not to get towed or stolen for a few hours. They’re not usually fantastic places to park them, but if someone’s driven somewhere, where exactly are they supposed to leave the car when it’s time to get out?

People being people, they get frustrated. No one drop of water considers itself part of the flood, after all.

tire clamp
Busted.

And finally, there are plenty of places — like my home state of Veracruz, for example — in which it is perfectly possible to have and drive even multiple cars without having had to prove to anyone that you can even identify a vehicle, much less handle one.

In order for me to get my license here, for example, I simply presented my identification, filled out some forms, took an eyesight test, and paid my money. Voila! I was a legal driver. Suffice it to say, there are certainly plenty of drivers meandering their way through our streets who surely believe they’re doing a perfectly fine job on the road, completely ignorant of the actual rules. And with the shortage of transit police and budgets and training for those transit police, it seems set to continue indefinitely.

Some people, though. Some people are just jerks. I’m thinking of a particular road in my city in a ritzier area of town, the kind where most people drive large SUVs and decide to drive them to the store a couple of blocks away because it’s more comfortable than walking.

I can’t count the number of times I’ve had to slam on the brakes and quickly switch lanes after cresting a hill because people have been double-parked in front of a fruit stand or hair salon. The hazard lights help, but some people don’t even put those on, increasing the perceived defiant attitude of “What? I’m important and I need to do some things here, you can go around.”

So when I think about people who do that, I say, “Bring on the boots! I can’t wait!” Let’s just hope that this punishment is applied evenly, and that the ancient habit of paying off officials for permission to behave badly won’t kick in. (I know. It probably will.)

The result of punishments like this in a culture like this is that people — especially privileged people — are absolutely shocked when they’re made to follow the rules, because it’s so easy to get away with not following them. But there’s no great secret to law-abiding cultures, after all. It’s just that the consequences for not falling in line are consistent and frequent. That’s literally it.

So anyway, Metepec (and the rest of Mexico, for that matter): yes, good idea. Let’s crack down on these annoying parkers! But also, for goodness sake, cars aren’t going away anytime soon.

Let’s at least make an effort to accommodate them. Through the twin virtues of logical infrastructure and clear rule-setting with follow-through of consequences it can be done!

Sarah DeVries writes from her home in Xalapa, Veracruz.

Virus strikes at Mexico City airport: traffic plunged 94% in May

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Quiet times at the Mexico City airport.
Quiet times at Benito Juárez International.

Not unexpectedly, traffic took a dive at Mexico City’s Benito Juárez International Airport last month as the coronavirus continued to take a toll.

The number of travelers dropped by 93.7% compared to the same month last year. Passenger numbers dropped to 275,975 from 4.34 million in 2019.

The decrease was slightly more pronounced in May than it had been in April when the number of air travelers fell by 92.8%.

During the first five months of 2020 the airport saw a 44% drop in passengers, with 8.79 million fewer travelers passing through its terminals, the greatest decrease in travel ever recorded at the airport.

While January and February of this year showed a consistent growth rate of 8%, when the coronavirus pandemic hit in March numbers quickly plummeted and would only get worse.

The Benito Juárez airport, which employs some 35,000 people and is the largest in Latin America, saw more than 50 million passengers in 2019, and had been experiencing steady growth for the past eight years. 

The airlines are feeling the pain as well. Mexico’s largest national airline, Aeroméxico, saw traffic decline by 91% in April and 92.4% in May. Volaris saw a 90% reduction in passengers during the same period.

Embattled discount airline Interjet has returned nearly 60 of its planes to leasing companies in recent months, is only operating three aircraft in its fleet and is being sued by the city of Chicago for US $2.56 million in unpaid airport fees. 

The reduced number of passengers also translates into a marked decrease in airport taxes, which serve as a guarantee for the payment of US $4.2 billion that the government owes to holders of international bonds that financed the canceled airport project in Texcoco.

Earlier this month the government also announced the cancellation of a project to add a third terminal to the Benito Juárez airport.

“Due to the pandemic, the operational needs have changed. The demand of passengers in the air industry, in Mexico and elsewhere, has fallen a great deal, and it will take between two and four years to recover the levels we had in February 2020,” the government said in a statement. 

By that time the General Felipe Ángeles International Airport in nearby Santa Lucía is expected to be open.

Peter Cerdá, the vice president for the Americas of the International Air Transport Association (IATA), confirmed that air traffic in Mexico will take at least three years to recover. 

Globally, 93% of airline routes have been canceled, and losses to the airline industry this year are estimated to approach US $84 billion with US $16 billion in losses projected for 2021, IATA says.

Source: El Financiero (sp), Prensa Latina (en), Simple Flying (en), Financial Post (en)

AMLO confirms Washington meeting with US President Trump

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López Obrador and Trump will meet in July.
López Obrador and Trump will meet in July.

President López Obrador announced Wednesday that he will travel to Washington “very soon” to meet with U.S. President Donald Trump.

At his daily press briefing, López Obrador said the meeting would celebrate the July 1 entry into force of the new trade treaty between Mexico, the United States and Canada.

“It will be soon, we are just waiting to define the character of the meeting. We want the prime minister of Canada, Justin Trudeau, to participate as well,” López Obrador added.

This will be the first trip that López Obrador has made abroad since he assumed the presidency in December 2018.

The visit to Washington, D.C., will most likely take place shortly after July 1, when the Mexican president will hold a ceremony to commemorate the two-year anniversary of his victory in the 2018 presidential election.

López Obrador indicated that the exact date will be confirmed later this week.

At a press conference in Yuma, Arizona, Tuesday, Trump commented that illegal migration has decreased 84% over last year and illegal crossings of Central Americans have dropped 97%. The president thanked López Obrador for his efforts.

“If you look at so many of the different crimes that come through the border, they’re stopped. We’ve implemented groundbreaking agreements with Mexico. I want to thank the president of Mexico. He’s really a great guy,” Trump said. “I think he’ll be coming into Washington pretty soon, to the White House.”

Critics of López Obrador are skeptical that the meeting will be beneficial for Mexico, where Trump is not generally well-liked, and did not mince words.

In a post to Twitter, the former Mexican ambassador to the United States, Arturo Sarukhán, called the potential visit “a big blunder and a mistake,” saying that Trump would only use the Mexican president as an electoral prop. 

In an interview earlier this month Sarukhán called such a visit “suicidal for Mexico’s long-term and strategic relationship with the United States.”

He told journalist León Krauze that López Obrador runs the risk of being perceived as a Trump ally.

Former foreign minister Jorge Castañeda told Reuters he thought a visit was “a dumb idea” considering it is an election year in the United States.

Source: El Financiero (sp), The Hill (en) 

Spanish firm reported to have canceled US $1.2-billion investment

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The Spanish firm Iberdrola has been a major investor in Mexico's energy sector.
Iberdrola has been a major investor in Mexico's energy sector.

The Spanish energy company Iberdrola is canceling a US $1.2-billion project in Veracruz, according to government officials.

The mayor of Tuxpan told the news agency Bloomberg that representatives of the firm told him that it was canceling its combined-cycle plant in the city because in nine months it has been unable to reach a natural gas supply agreement with the state-owned Federal Electricity Commission (CFE).

“The company received orders from corporate headquarters in Spain to leave. They had everything ready and were just waiting on the gas contract to get started,” Juan Antonio Aguilar Mancha said.

In a separate interview with the newspaper Reforma, the mayor expressed regret about the decision, explaining that the project would have generated 2,000 local jobs.

However, Aguilar told Bloomberg that Iberdrola could continue with the project if it reaches a gas supply deal with the CFE or TC Energy (formerly TransCanada Corporation) in the next two weeks.

He said the firm has been working on the project for more than a year and has spent about $40 million thus far to purchase land, obtain permits and pay workers. Construction of the plant was scheduled to begin in July.

Reforma and Bloomberg asked Iberdrola to comment on the cancellation but it declined.

Meanwhile, Veracruz Governor Cuitláhuac García tweeted on Wednesday that the Tuxpan plant will go ahead but the CFE will operate it.

“I spoke with … [federal] Energy Minister Rocío Nahle and she confirmed that the Tuxpan project remains but it’s a CFE project. The state company will call for bids for its construction … [and] Veracruz companies will have the opportunity to work on it,” he wrote.

News of Iberdrola’s decision to cancel the project and its apparent takeover by the CFE comes two weeks after President López Obrador claimed that the Spanish company has a monopoly in Mexico’s electricity sector.

He said Iberdrola produces almost half of the power injected into the national grid by private companies and accused the firm of improper conduct because it has hired former federal energy officials.

If Iberdrola’s cancellation of its power plant is confirmed, it will be the first major investment cancellation in the electricity sector since the federal government announced a new energy policy that imposes restrictive measures on renewable energy and seeks to consolidate control of power generation in the CFE.

Bloomberg reported that it wasn’t clear whether Iberdrola’s inability to reach a gas supply deal with the CFE was related to the government’s stance on electricity generation by private companies or López Obrador’s recent criticism of the firm.

Iberdrola has invested heavily in Mexico and the Tuxpan plant was part of a $5-billion investment plan that includes other power generation facilities and a solar park.

The former government’s energy reform opened up greater investment opportunities for private and foreign firms but López Obrador now appears intent on limiting their participation.

He claimed last month that private companies, including those that generate clean, renewable energy from sources such as wind and solar, have provided “nothing” to the national electricity system even though data shows that they generate a significant proportion of the power used in Mexico, and at a cheaper price than the CFE.

The Federal Economic Competition Commission has warned that electricity rates could go up if the CFE ramps up energy production at the expense of new renewable energy projects but López Obrador has pledged that there will be no price hikes while he remains in office.

“I’m not going to break my commitment to maintain the price of electricity. … It won’t increase during my entire six-year term,” he said last week.

Source: Reforma (sp), Milenio (sp), Bloomberg (en) 

Mexico’s crusade for healthy eating could hurt trade

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The president tucks into a meal of traditional food.
The president tucks into a meal of traditional food.

If Andrés Manuel López Obrador, Mexico’s nationalist president, had more time to watch movies, he might like to tuck into a new documentary about one of the most passionate defenders of his country’s culinary traditions.

The film profiles Diana Kennedy, a 97-year-old Briton who has arguably done more than any other cookery writer alive to put Mexican cuisine on the map and preserve the unique ingredients and techniques of which López Obrador is so proud.

It would surely strike a chord with a president who included eating corn and beans, rather than processed meals, on his folksy 10-point plan for post-Covid living in a video this month. The timing was curious: he announced his decalogue, which also urged Mexicans to be optimistic, enjoy nature and pursue the path of spirituality, two weeks before the launch of an updated version of the free-trade treaty that boosted Mexico as a prime market for U.S. convenience food and high fructose corn syrup in the first place.

The US-Mexico-Canada Agreement, or USMCA, expands and replaces the North American Free Trade Agreement and comes into force on July 1.

The president’s crusade against junk food has been given a new urgency because of Covid-19, which is particularly dangerous for the nearly three-quarters of Mexicans who are overweight or obese and 16% who are diabetic. But it has also intensified pressure on processed food manufacturers who are major investors in Mexico and are upset at the plans to slap warning labels screaming “too much salt,” “too high in calories” or “too much fat” on snacks and sodas later this year.

Trade has helped processed food powerhouse Bimbo.
Trade has helped processed food powerhouse Bimbo.

The move comes on top of investor-unfriendly decisions in other sectors, including a decision to scrap a partially built brewery owned by Constellation Brands of the U.S. in March, as well as abrupt policy shifts in the energy sector that have put Mexico on a collision course with USMCA partner companies.

The health crusade, which will begin next month and be taught in schools, conveniently overlooks the fact that Mexico exports some US $22 billion a year in processed food to the U.S., more than double the $9 billion in processed food products that it buys from its biggest trading partner. That has helped create Mexican processed food powerhouses, including Bimbo, the world’s largest bakery company, and Gruma, the leading tortilla maker.

López Obrador, who served mugs of hot chocolate and tamales to the country’s business elite at a dinner at the National Palace earlier this year, and who counts bean stews and a cacao and corn drink called pozol among his favourites dishes, urged Mexicans to “eat natural.”

“Let’s eat well, let’s opt for what is natural, fresh and nutritious,” he said in his video. “One alternative is corn, beans, vegetables, seasonal fruit, tuna and protein from animals . . . not fattened with hormones. Let’s avoid eating so-called junk made with excess sugars, flours, salts, chemicals and fats.”

Despite Unesco recognizing Mexico’s cuisine as a world heritage, U.S. fast-food chains such as Subway, Starbucks, McDonald’s and KFC line the streets. Mexico gave the world chocolate but U.S. companies Mars and Hershey’s are among the country’s top confectionery sellers. Mexico is also one of the biggest guzzlers of Coca-Cola while the president urges his compatriots to drink “plain water.”

Critics blame NAFTA for Mexico’s obesity epidemic and López Obrador’s health concerns are personal — he himself is hypertensive and had a heart attack in 2013. Yet he seems not to weigh the consequences his policies could have on trade in an increasingly integrated North America, even as he bets on USMCA to bring investment and haul Mexico out of the Covid-induced slump.

His advocacy for traditional foods is part of a wider vision to make Mexico self-sufficient. “Corn is native to our country and yet we are buying more corn than any other country in the world,” he fumed last year, blaming the policies of Carlos Salinas, the president who signed NAFTA.

If the president succeeds in changing eating habits, Mexicans could do worse than to try out Kennedy’s traditional techniques. “Read my books and learn, please,” she lectures in the film. “What are you going to do when I’m gone?”

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