Fernando Villavicencio, an Ecuadorean politician and former journalist, was assassinated on Wednesday, after a rally in support of his presidential campaign. (Asamblea Nacional del Ecuador/Wikimedia)
There is “no evidence” that Mexico’s Sinaloa Cartel was involved in the Wednesday assassination of Ecuadorean presidential candidate Fernando Villavicencio, Mexican Foreign Minister Alicia Bárcena said on Thursday.
Bárcena said that Mexico is “worried, distressed and afflicted” by Villavicencio’s killing and has offered Ecuador “all the support it requires,” but stressed that it is too early to know if the murder has any links to Mexican organized crime.
President López Obrador with Foreign Minister Alicia Bárcena. Both have made statements regarding the assassination of Fernando Villavicencio on Wednesday in Ecuador. (Alicia Bárcena/Twitter)
“We do know that candidate Villavicencio had made pronouncements [about criminals linked to the Sinaloa Cartel] in his campaign, but there is no proof,” she said at a press conference following a meeting in Washington, D.C. with U.S. Secretary of State Antony Blinken. She lamented that insecurity is a problem throughout “the entire region.”
In his Thursday morning press conference, President Andrés Manuel López Obrador also insisted that “there is no evidence” to suggest the Sinaloa Cartel was behind Villavicencio’s killing.
Villavicencio was shot as he left a campaign rally in the country’s capital, Quito, and nine other people were injured in the gunfire. In the weeks leading up to his assassination, he had denounced threats from an imprisoned criminal leader with alleged ties to the Sinaloa Cartel.
The candidate, who was also a former journalist, first reported on July 31 that he was receiving threatening messages from José Adolfo “Fito” Macías Villamar, leader of Ecuadorean gang Los Choneros. This gang is considered a major transporter of cocaine through Ecuador and is believed to supply international trafficking routes managed by the Sinaloa Cartel.
A group of masked, armed men claiming to be Los Lobos posted a video claiming responsibility for the murder. (Screen capture)
Hours after the killing, however, a group of hooded men claiming to belong to Los Choneros’ rival gang Los Lobos released a video claiming responsibility for the attack. Los Lobos are thought to be linked to Mexico’s Jalisco New Generation Cartel (CJNG), bitter rivals of Sinaloa. To confuse matters further, a group of unmasked men claiming to be true members of Los Lobos released another video on Thursday, rejecting the first video and denying the gang’s involvement.
The same day, an Ecuadorean judge ordered preventive detention for six men arrested for their alleged participation in the assassination. All six were Colombian nationals.
The extent of Mexican involvement in Ecuador’s spiraling drug violence is still unclear. Ecuador is one of the world’s key cocaine transit countries, distributing between 700 and 800 tons per year, mostly to the United States and Europe. While Mexican organized crime has been present in the country since the early 2000s, internal drug transport and the associated violence are managed by local criminal groups.
“Ecuador’s violence problem is endogenous,” Daniel Pontón, dean of the School of Security and Defense of the Institute of Higher National Studies of Ecuador, told El País newspaper. “Of course, it is largely financed by international organized crime. But I don’t know to what extent the Mexican cartels pull the strings of what happens here. The truth is that there is little information.”
Ecuador’s president Guillermo Lasso has declared a national state of emergency, but confirmed that elections will still be held as scheduled on Aug. 20.
The Mexican Baseball League is at the center of allegations over ineligible player drafts for the postseason. (Diablos Rojos de México/Cuartoscuro)
The playoffs for the Mexican Baseball League (LMB) began this week, so it should be a joyous time. Instead, the 98-year-old professional league is embroiled in controversy surrounding the use of several foreign players who have allegedly false documents that identify them as Mexicans.
At his morning press conference Wednesday, President López Obrador requested that the Sports Appeals and Arbitration Commission (CAAD) investigate the irregularities that some LMB teams have presented — such as players with questionable birth certificates.
President López Obrador said he had instructed the National Commission for Physical Culture and Sports (Conade) to look into the allegations of fraud by some teams in the Mexican Baseball League. (lopezobrador.org.mx)
“What’s going on?” the president, a huge baseball fan, asked after a 3,700-word exposé by five reporters appeared Tuesday in the newspaper Proceso, detailing how many non-Mexican ballplayers have acquired fraudulent documentation saying that they are. In one case, two non-Mexican players from different countries had presented birth certificates from the same small community.
“Some teams are cheating, hiring what in baseball circles are said to be cachirules. Suddenly it appears that they were born in a town in Sinaloa, Durango, Chihuahua,” AMLO continued. “They obtained their birth certificates, and then they violate what is in the regulations — that there should be only a [certain] number of foreigners per team.”
The term cachirules dates back to a controversy 35 years ago when Mexico used soccer players older than the age limit in the under-20 World Cup, leading to the country’s disqualification from 1990 World Cup qualifying matches — and giving Mexican soccer a huge black eye.
The term itself is a mashup of the Spanish word cachibaches (“odds and ends” or “junk”) and the English word “rules.”
Many Mexican newspapers used the term in their coverage this week, including the Proceso article, which was headlined, “Cachirules in baseball, the new scam in Mexican sports.”
AMLO said he will ask Ana Gabriela Guevara, head of the National Commission for Physical Culture and Sports (CONADE), to enact a CAAD investigation to determine the scope of the irregularities. But he also urged the franchise owners to correct the violations on their own.
“Yes, let [CAAD] do the research,” AMLO said, “but I also take this opportunity to make a very respectful appeal to the team owners so that if they made this mistake, they can rectify it. It is wise to change your mind.”
Proceso provided extensive details on how players had acquired false documentation. Onelki García, a 34-year-old Cuban-born pitcher for the Mérida-based Yucatán Lions, has a birth certificate from the hamlet of Concordia, Sinaloa. Allegedly his parents went there to register their son as a Mexican national, but his father told Proceso that he has never been to Mexico.
Onelki García is one of the players at the center of the scandal. He has an allegedly falsified Mexican birth certificate from a small town in Sinaloa. (wikiwand)
The report detailed other similar cases, and a common trait was that many of these birth certificates were issued in small, remote towns, such as La Huacana, Michoacán, where — uncannily — both Venezuelan player Danry Vásquez and American Henry Gatewood were allegedly registered by their parents as Mexicans when they were newborns in the mid-1990s.
Horacio de la Vega, president of the LMB, said it’s up to the teams to make sure players’ documents are legal.
“I am not an authority to question the originality of a document,” he said. “If they come to me with a birth certificate or passport, I consider it legitimate.”
The remaining four contenders vying to represent the Broad Front for Mexico coalition in 2024. From the left: Enrique de la Madrid, Beatriz Paredes, Xóchitl Gálvez and Santiago Creel.(Cuartoscuro)
And then there were four: just two women and two men remain in contention to secure the 2024 presidential election candidacy for the Broad Front for Mexico (FAM), the opposition alliance made up of the National Action Party (PAN), the Institutional Revolutionary Party (PRI) and the Democratic Revolution Party (PRD).
The FAM organizing committee announced Wednesday that Senator Xóchitl Gálvez, Deputy Santiago Creel, Senator Beatriz Paredes and former tourism minister Enrique de la Madrid met the requirements to reach the second stage of the opposition bloc’s candidate selection process.
The opposition coalition, including the PAN, PRI and PRD, has formed the “broad front for Mexico”. (Daniel Augusto / Cuartoscuro.com)
The first two are representatives of the PAN, while the latter two are affiliated with the PRI.
Each of the four aspirants collected well over 150,000 signatures of support, the minimum threshold to remain in the contest to represent the PAN-PRI-PRD alliance at the June 2, 2024 election.
Gálvez, Creel, Paredes and de la Madrid collected at least 1,000 signatures of support in at least 17 of Mexico’s 32 federal entities and thus met another requirement to reach the second stage of the selection process, which will include a “great forum” Thursday night during which each aspirant will set out their vision for Mexico.
A polling process will follow to determine the three contenders with the greatest support. The “finalists” will progress to the third stage, during which five more forums will be held to give the would-be candidates additional opportunities to present their ideas and sell themselves to voters.
Leaders of the PAN, PRI and PRD at the National Electoral Institute (INE) after registering the Broad Front for Mexico in July. (ANDREA MURCIA /CUARTOSCURO.COM)
According to the FAM selection process outlined in late June, new public opinion studies will be carried out to gauge support for the three aspirants and the results will be published on Sept. 3.
A “direct” vote in which registered citizens can participate will be held on the same date, with the results to be announced that night.
The results of the third stage public opinion studies and the vote will be given equal weighting to determine the “person responsible for the construction of the Broad Front for Mexico.” That person will become the FAM presidential candidate once the election period officially commences.
Xóchitl Gálvez
PAN senator Xóchitl Gálvez is currently polling ahead of the other aspirants. (Xóchitl Gálvez/Twitter)
The PAN senator is currently the leading FAM aspirant, according to the results of an El Financiero newspaper poll published Tuesday, with 23% of respondents nominating her as their preferred opposition candidate.
Born in Tepatepec, Hidalgo, in 1963, Gálvez served as mayor of the Mexico City borough of Miguel Hidalgo between 2015 and 2018, and was general director of the federal agency in charge of indigenous affairs during the second half of the 2000-2006 government led by former president Vicente Fox.
The indigenous Otomí woman, a computer engineering graduate, has been a senator since 2018, but her profile has risen exponentially since she announced her intention to seek the presidency in a video posted to social media in late June.
President López Obrador claims that Gálvez has already been chosen as the FAM candidate, and has repeatedly made verbal attacks on the senator, prompting the National Electoral Institute (INE) to ban him from speaking about electoral issues in the lead-up to the 2024 elections.
Santiago Creel
The PAN deputy, who has previously served as a senator, attracted 14% support among respondents to the El Financiero poll.
Santiago Creel (PAN) has had a long career in government, serving as Interior Minister during the administration of Vicente Fox. (Santiago Creel/Twitter)
Creel, a lawyer by profession, is best known for having served as interior minister – usually considered the second most powerful position in Mexican politics – during the government of Fox, who won the presidency for the PAN in 2000 after more than 70 years of uninterrupted PRI rule.
Before serving as interior minister, he represented the PAN at the 2000 Mexico City mayoral election, which was won by López Obrador.
Born in Mexico City in 1954, Creel sought to represent the PAN at the 2006 and 2012 presidential elections, but his quest to obtain the conservative party’s candidacy was unsuccessful on both occasions.
Beatriz Paredes
The PRI senator, governor of Tlaxcala between 1987 and 1992, is the preferred FAM candidate of 8% of those recently polled by El Financiero.
PRI senator Beatriz Paredes was also the governor of Tlaxcala and an ambassador to Brazil. (Beatriz Paredes/Twitter)
Born in Tlaxcala in 1953, Paredes served as Mexico’s ambassador to Brazil between 2012 and 2016. She was national president of the PRI between 2007 and 2011 and for a period also headed up the National Farmers Federation.
In addition, the sociology graduate has served as a federal deputy and contested the 2012 Mexico City mayoral election won by Miguel Ángel Mancera.
Enrique de la Madrid
Enrique de la Madrid served as tourism minister in the Peña Nieto administration, and his father was president of Mexico from 1982-88. (Enrique de la Madrid/Twitter)
The son of former president Miguel de la Madrid (1982-88), Enrique de la Madrid attracted 13% support among El Financiero poll respondents.
Born in Mexico City in 1962, the FAM presidential aspirant was tourism minister in the second half of the 2012-18 government led by former president Enrique Peña Nieto.
He was a federal deputy between 2000 and 2003 and later headed up two different state-owned development banks. De la Madrid studied law at the National Autonomous University and subsequently obtained a Masters degree in Public Administration from Harvard University.
Who failed to reach the second stage of the FAM selection process?
Former Michoacán governor Silvano Aureoles, ex-Tamaulipas governor Francisco García Cabeza de Vaca, former Querétaro governor and current Deputy Ignacio Loyola, ex-Mexico City mayor and current Senator Miguel Ángel Mancera, former deputy and senator Jorge Luis Preciado and Deputy Gabriel Quadri will not take part in the second stage of the FAM selection process. Three “ordinary citizen” aspirants are also out of the contest.
Jesús Zambrano, national leader of the PRD (center), flanked by Miguel Ángel Mancera (left) and Silvano Aureoles (right) at a press conference on Thursday. (PRD/Twitter)
Aureoles, Mancera and García Cabeza de Vaca all collected more than 150,000 signatures of support, but didn’t reach the second stage of the selection process as they either lacked the minimum level of support across 17 entities or some of the signatures they collected were deemed to be invalid. Aureoles and Mancera, both PRD representatives, questioned the fairness of their exclusion from the contest, while García Cabeza de Vaca said he would have liked the FAM to be a “little more flexible” with its rules on the collection of signatures.
What is the Broad Front for Mexico (Frente Amplio por México)?
Political parties in Mexico commonly create new coalitions (or at least coalitions with new names) to support their candidates at federal elections.
In the 2018 presidential election, Andrés Manuel López Obrador represented the Juntos Haremos Historia (Together We Will Make History) alliance, Ricardo Anaya stood for the Por México al Frente (For Mexico in Front) coalition and José Antonio Meade represented the Todos por México (All for Mexico) bloc.
In an attempt to avoid falling foul of electoral laws, the person elected as the FAM candidate will initially be known as the “person responsible for the construction of the Broad Front.”
The PRD announced Thursday that it would “pause” its participation in the FAM organizing committee in consideration of the exclusion of Mancera and Aureoles from the candidate selection process.
“We’re not going to accept improper political exclusions of anybody,” said PRD national president Jesús Zambrano.
It wasn’t all smooth sailing for Va por México either. The electoral success of that coalition, whose constituent parties come from both the right and left of Mexican politics, was limited, and differences in opinion between the parties, as well as opposition to Alejandro Moreno’s leadership of the PRI, almost led to a split in the bloc last year.
The 2024 Elections
In addition to electing a new president, Mexicans on June 2, 2024 will also renew both houses of federal Congress – the Chamber of Deputies and the Senate.
Voters in eight states will elect new governors, while citizens in Mexico City will choose a new mayor. Many other state and municipal positions will also be up for grabs.
The Ruling Morena party
The alliance led by the National Regeneration Movement (Morena) is also conducting a primary-style process to select its 2024 presidential candidate. The leading aspirants in the six-person field are former Mexico City mayor Claudia Sheinbaum, ex-foreign affairs minister Marcelo Ebrard and former interior minister Adán Augusto López.
The Morena-led alliance, which also includes the Labor Party and the Ecological Green Party of Mexico, will announce its new standard bearer on Sept. 6.
Claudia Sheinbaum (center) with other Morena aspirants for the nomination, from left to right, Marcelo Ebrard, Adán Augusto López and Ricardo Monreal. (CNM/Twitter)
The recent El Financiero poll found that Morena remains on track to retain the presidency at the 2024 election, but the popularity gap between Sheinbaum and Gálvez, and Ebrard and Gálvez, narrowed compared to the newspaper’s previous survey.
Morena founder López Obrador, who is banned by the constitution from seeking a second term in office, will hand over the presidential sash to his successor on Oct. 1, 2024.
Authorities in Quintana Roo have moved to close pharmacies they believe were selling expired, illegal and counterfeit medications in tourist destinations. (Daniel Augusto/Cuartoscuro)
Mexico’s Federal Commission for the Protection against Sanitary Risks (Cofepris) announced this week that a number of pharmacies in the state of Quintana Roo have been shut down for irregularities, including selling medicines that were expired, possibly counterfeit, or that they didn’t have authorization to sell.
Irregularities were found at 23 of the 55 pharmacies in Cancún, Playa del Carmen and Tulum visited during a four-day series of Cofepris raids dubbed “Operation Albatross” by the health protection agency and the Secretary of the Navy (Semar).
Some of the medication seized appeared to be counterfeit. (James Yarema/Unsplash)
Federal officials said in a statement Tuesday that 21 products were seized, including a variety of drugs that will be tested for counterfeiting, adulteration and the presence of harmful drugs such as fentanyl.
Cofepris noted it has “suspended the activities of 23 pharmacies and/or points of sale … where controlled medicines were sold irregularly, which represents a high risk to people’s health.”
Irregularities found at the pharmacies, according to Cofepris, included operating without a proper health license, stocking controlled drugs without proper documentation from drug suppliers, selling prescription drugs without a doctor’s signature, selling expired medications (some for more than a year) and not having customer data.
Also cited was a lack of traceability in the management of controlled medications, through such media as sales receipts.
Federal regulator Cofepris took measures to combat the illicit pharmacies after an investigation by the LA Times newspaper earlier this year found evidence of Mexican pharmacies selling medications improperly to foreigners. (Wikimedia)
The statement said “an operation of unprecedented dimensions” was undertaken “in response to various citizen complaints” in a part of Mexico “that receives millions of national and foreign tourists every year.”
None of the suspended pharmacies are connected to any major national chains.
The statement provided a list of the pharmacies that received total suspensions or partial suspensions or that had products seized:
Drugstore Pharmacy
Farmacia Tulum Centro III
Farmacia Tulum Coba
Farmacia Tulum Europea in Tulum
Cancún Cristal Pharmacy
Cancún Tortugas Pharmacy
Cancún Forum Pharmacy
Cancún Coba Pharmacy
Simas Pharmacy
Drugstore Pharmacy in Cancún
2 branches of PDC Pharmacy in Playa del Carmen
Two branches of the PDC Pharmacy were closed in the city of Playa del Carmen. (Farmacias de Mexico)
Cofepris said that in many instances, the establishments sell the irregular medications only to foreigners, and that they hand out advertising cards highlighting the sale of prohibited medications without the customer needing to present a prescription.
Operation Albatross was conducted a month or so after a Los Angeles Times newspaper investigation revealed that pharmacies in some of Mexico’s tourist destinations were selling counterfeit pills laced with fentanyl and methamphetamine. Reporters identified at least six people who had overdosed or died after taking pills they bought from pharmacies in Mexico, noting that grieving families have long been trying to alert Congress and U.S. officials of the risk. The U.S. State Department, however, didn’t issue any type of official warning until March.
Reports on the Cofepris operation didn’t indicate whether anyone was criminally charged.
In its release, Cofepris invited people to make any additional health complaints via a government website.
Thinking of a vacation to Holbox Island? Don't overlook these neighboring destinations. (Photos by Thilini Wijesinhe)
Holbox Island, located to the north of the Yucatán Peninsula in the Yum Balam nature reserve, is sure to charm with its beautiful beaches, seaside activities and biodiversity.
While its name might make it sound like it belongs somewhere in England, the word holbox (pronounced “ol-bosh”) is Mayan for “black hole,” probably a reference to the dark coloring of the lagoon water here.
Shallow waters surround Holbox and its neighboring islands.
You can easily take a ferry to Holbox from the town of Chiquilá, about a two-hour drive from Cancún. Visitors can also explore several spots around Holbox like Bird Island (Isla Pájaros), Passion Island (Isla Pasión) and the Yalahau freshwater pool. Look for “three islands” tours from Holbox that typically go to these places.
Bird Island is about a 30-minute boat ride from Holbox into the Yalahau Lagoon, the body of water that separates Holbox from the mainland. As the name suggests, you can observe many bird species there, including pelicans, frigate birds and ducks. From April to October is a good time to visit Bird island, when you typically see flamingos.
While visitors are not permitted to go ashore due to its protected status, the nearby lookout points offer magnificent views over the island and the lagoon, with many photography opportunities. Take a pair of binoculars if you want to observe birds closely.
If you have some time to linger, take a dip in the Yalahau cenote, a stunning natural pool among mangroves. You will not tire of swimming in its cool and clear water.
The Yalahau cenote, accessible by boat from Holbox.
The inhabitants of Holbox are believed to have used this natural pool for their freshwater needs since ancient times. According to folklore, an ancient Maya king had made this spring into a private pool for his wives and beautified its surroundings with gardens and other decorations. Another tale says that the water of the Yalahau cenote revitalizesvisitors, making them feel younger. It’s therefore also known as a fountain of youth.
This area was once a sanctuary for pirates. According to one legend, the pirate Francisco de Molas, who lived there, had buried a treasure in the area with the help of an aide who was beheaded soon afterward. The aide’s head was supposedly buried with the treasure, and it is said that at night, the head appears where the fortune is buried.
After enjoying this natural pool, visit the observation deck for glorious views across the area — but take good care when climbing the wooden stairs. There are also various rest areas on site. Though we didn’t see any during our trip, you can sometimes spot crocodiles in the lagoon.
The final stop on our tour was Passion Island. With picturesque surroundings, shallow water and white sand, this island and its surroundings are breathtaking. It is a great spot to swim or just take in the tranquil atmosphere. The water is so shallow that you can easily wade about. Don’t forget to visit the lookout point for spectacular views.
Birds gather on Passion Island.
Unlike Bird Island, visitors are usually allowed ashore onto Passion Island. This island is said to attract turtles during the breeding season, which starts in May and lasts until September.
Some tours may also stop at Punta Mosquito, a magnificent sandbank by Holbox Island. If you can’t find a tour that stops there, consider visiting it on your own; it’s worth it. You can rent bicycles or golf carts in Holbox to conveniently get around the island. About two and a half kilometers from the ferry dock toward the north of the island is the access point to a beach close to Punta Mosquito. You’ll need to park your bicycles or golf carts there and proceed by foot, as this is a protected area. From this beach, we waded through the water to the sandbank when the tide was low in the morning. You can also see different bird species at Punta Mosquito and perhaps even flamingoes from April to October.
While some visitors make day trips to Holbox, staying a few days on the island gives you time to indulge in different activities and have a relaxing break. Depending on your activities of interest, there are several different tours you can take that leave from Holbox, so you’re not limited. If you’re looking for a nighttime outing, check out the bioluminescence at certain beaches.
The sandbank at Punta Mosquito.
This natural — but oh so magical — display of light is due to certain bioluminescent marine organisms; it looks like tiny stars have fallen onto the sea.
And one last thing: remember to avoid disturbing the flora and fauna around you while enjoying everything Holbox Island offers, so it’ll all be there next time you — or someone else — goes back.
Thilini Wijesinhe, a financial professional turned writer and entrepreneur, moved to Mexico in 2019 from Australia. She writes from Mérida, Yucatán. Her website can be found at https://thilini.me/
A worker puts together a sedan at the BMW plant in San Luis Potosí. (BMW)
Foreign direct investment (FDI) in Mexico hit a record high of over US $29 billion in the first half of 2023, according to preliminary data published Wednesday.
The Economy Ministry (SE) reported that FDI was US $29.04 billion between January and June, a 41% increase compared to the same period of last year if spending on the Televisa-Univisión merger and the restructuring of Aeroméxico is excluded from the investment total.
An important caveat to note is that the US $29.04 billion figure quoted for 2023 by the Economy Ministry is a 41% year-on-year increase only if a the Televisa merger and Aeroméxico restructuring in 2022 is excluded. (Cuartoscuro)
FDI was 5.5% higher in the first six months of 2023 compared to that received a year earlier including spending on the television industry merger and the restructuring of Mexico’s flag carrier.
The SE said that FDI in the first half of the year came from 2,189 Mexican companies funded by foreign capital (such as subsidiaries of foreign firms), 2,631 trust agreements and one foreign company.
The lion’s share of the $29 billion in FDI —78% — came from reinvestment of profits, while 15% stemmed from loans and payments between companies of the same corporate group. Just 7% of the FDI total — $2.1 billion — was new investment, the SE said.
The ministry said that the FDI data for the first half of the year is indicative of “investors’ confidence to maintain and increase their investments in the country.”
The United States was by far the biggest source of foreign investment in Mexico in 2023. Hover over each segment to see the monetary amounts invested by each country.
President López Obrador said Tuesday that “the environment for investment is very good in Mexico.”
“There are unbeatable conditions,” he said, adding that Mexico is the world’s “preferred” country for foreign investment.
SE data showed that the United States was the biggest investor in Mexico in the first half of the year, with 43% of the $29 billion in FDI, or $12.4 billion, coming from that country. Spain ranked second, contributing 15% of the total, followed by Germany (9%), Argentina (8%), Japan (7%), the Netherlands (4%), Canada (4%) and the United Kingdom (3%).
Five federal entities received 60% of the FDI: Mexico City was the biggest winner, getting $10.22 billion or 35% of the total, while Nuevo León secured 10% and each of Baja California, Jalisco and México state obtained 5%.
Nuevo León has made major announcements this year about big foreign companies investing in the state, but Mexico City saw more than three times the state’s FDI in 2023’s first semester.
The SE said that 57% of the FDI total between January and June was directed to Mexico’s manufacturing sector. Among the manufacturing subsectors that benefited were the automotive, chemical, food and beverage and electronics industries.
The financial services sector received 27% of the FDI total, while the temporary accommodation, mining, construction and transport industries got 5%, 3%, 2% and 2%, respectively.
Numerous foreign companies announced investment in Mexico during the first half of 2023, money that will boost FDI totals in the near future.
They included electric vehicle manufacturer Tesla, steel manufacturer Ternium and automaker BMW.
Mexico’s central bank has decided to keep its benchmark rate high, despite declining inflation. (GRACIELA LÓPEZ /CUARTOSCURO.COM)
Mexico’s central bank has once again decided to keep its benchmark interest rate at a record high of 11.25% as inflation remains a concern.
The Bank of Mexico (Banxico) announced that its five-member governing board unanimously decided to maintain the target for the overnight interbank interest rate at 11.25%.
A difference in interest rates has meant that the peso has strengthened against the US dollar for most of 2023. (Daniel Augusto/Cuartoscuro)
The key rate was raised to that level in March and kept there following monetary policy meetings in May and June.
Banxico’s latest decision came after the national statistics agency (INEGI) reported Wednesday that annual headline inflation was 4.79% in July, down from 5.06% in June.
Consumer prices have now declined during six consecutive months, but the central bank said in a statement that annual headline inflation and core inflation – 6.64% in July – are “still high.”
It also said that “the inflationary outlook is still very complex, … complicated and uncertain throughout the entire forecast horizon, with upward risks.”
“Thus, in order to achieve an orderly and sustained convergence of headline inflation to the 3% target, [the board] considers that it will be necessary to maintain the reference rate at its current level for an extended period,” Banxico said.
The bank said the same thing in May when it ended a monetary policy tightening cycle that lasted almost two years.
Central banks in Brazil, Chile, Costa Rica and Uruguay have all cut interest rates in recent weeks after aggressive hiking cycles, but analysts cited by the Reuters news agency say that a reduction in Mexico’s benchmark rate is unlikely until late 2023.
“When [cuts] do arrive, they will be more gradual than most currently anticipate,” said Jason Tuvey, deputy chief emerging markets economist at Capital Economics.
While consumer prices have declined, core inflation still remains high at 6.64%. (Victoria Valtierra Ruvalcaba/Cuartoscuro)
At 4.79%, annual headline inflation is still almost two percentage points above Banxico’s target, and the bank – which officially tolerates a 2-4% inflation range – is forecasting that it won’t go below 4% until the second quarter of 2024.
The Bank of Mexico anticipates that the annual headline rate will fall to 4.6% in the final quarter of this year and reach 4.1% in Q1 of 2024. It predicts a 3.7% rate in the second quarter of next year, 3.4% in Q3 and 3.1% in the final quarter of 2024.
Analysts cite Banxico’s high interest rate and the significant difference between that rate and that of the United States Federal Reserve (currently 5.25-5.5%) as one factor that has caused the Mexican peso to appreciate against the greenback this year.
One US dollar was trading below 17 pesos on Thursday morning, but subsequently strengthened to close at 17.04 pesos, according to the Bank of Mexico.
The INISA company, which owns a denim factory in Aguascalientes, was accused by union leaders of interfering with a worker vote on changing their collective bargaining agreement. (Victor Valtierra/Cuartoscuro)
The United States and Mexico have agreed to a remediation plan to address labor rights violations at the Industrias del Interior (INISA) denim garment factory in Rincón de Romos, Aguascalientes.
The agreement follows an investigation carried out by Mexico in response to a U.S. request in June 2022, which found that INISA workers were being denied the right to freedom of association and collective bargaining.
This was the first time the USMCA Rapid Response Labor Mechanism has been used in the garment industry. (Cuartoscuro.com)
It is the sixth time the two countries have agreed to a formal remediation plan under the Rapid Response Labor Mechanism of the United States-Mexico-Canada Trade Agreement (USMCA). It’s also the first time it’s been used within the garment industry.
“Through the Rapid Response mechanism, we have made it clear that companies are expected to respect the representative union and negotiate in real collective bargaining,” said U.S. Deputy Undersecretary for International Affairs Thea Lee.
The remediation plan includes several commitments from the Mexican government, including:
Ensuring that INISA disseminates and abides by a public, written statement guaranteeing noninterference in all union activities
Ensuring that INISA trains all company personnel and union representatives on this neutrality statement and implements a zero-tolerance policy for any violations
Offering a telephone line and/or direct email address for workers to anonymously report any intimidation, coercion or interference in their union activities
Conducting in-person workers’ rights training for all company personnel
Initiating sanctions proceedings if evidence emerges of any violations
Imposing appropriate sanctions against any individual, labor organization or company found to violate Mexican law.
The USMCA trade pact, between Canada, Mexico and the United States seeks to protect labor rights and promote trade between the North American nations in a way that’s different from previous trade pacts in the region. (Galo Cañas Rodríguez/Cuartoscuro.com)
U.S. Trade Representative Katherine Tai hailed the agreement as a positive example of international collaboration on labor rights. She pledged that the U.S. would closely monitor the implementation of the remediation plan.
The U.S. requested that Mexico investigate INISA after receiving a complaint in May via the Interagency Labor Committee for Monitoring and Enforcement (ILC) from two unions at the factory.
The unions alleged that the company was coercing workers into accepting its proposed revisions to their collective bargaining agreement. Mexican authorities agreed to investigate, and on July 27, they issued a ruling upholding the validity of the complaint.
Specifically, the Mexican investigation found trade union discrimination against a union representative, company interference to promote a vote in favor of revising labor benefits and disinformation regarding the potential loss of labor benefits that would supposedly result from voting against the agreement.
U.S. Trade Representative Katherine Tai said that the resolution demonstrated a positive example of international collaboration on labor rights. (Stephanie Chasez/Wikimedia)
INISA cooperated fully with the investigation, according to a statement by the Economy Ministry.
The ministry also reiterated Mexico’s commitment to comply with the Labor Reform of May 1, 2019, which guaranteed workers’ rights to freedom of association, a condition set by the U.S. in order to ratify the USMCA.
International air arrivals are up 7.2% on pre-pandemic levels, although overall tourism figures still lag behind 2019. (vooqq/Unsplash)
Mexico saw 7.2% more international tourists arrive by air in the first six months of 2023 compared to the same period in 2019, before the pandemic.
According to Tourism Minister Miguel Torruco Marqués, from January through June 2023, Mexico saw 10.8 million foreign tourists enter the country at international airports, compared to 2019’s figure of 10.1 million, an increase of 700,000.
The number of foreign tourists arriving by air is also 5.8% higher than last year, says the Tourism Ministry. (Shutterstock)
This year’s figure is also 5.8% higher than that registered from January through June of 2022, when the country received 10.2 million international tourists by air, suggesting that Mexico has been seeing a steady rise in tourism since pandemic restrictions in Mexico began to be fully lifted in 2022.
The three largest source countries for tourism to Mexico so far this year are:
United States (6.5 million tourists)
Canada (1.3 million)
Colombia (361,000)
Together, these three countries accounted for 8.3 million visitors, an increase of 13.9% compared to the number of tourists from those countries in 2019.
The majority of foreign tourists arriving in Mexico are from the United States, which topped the list ahead of Canada and Colombia. (Elisabeth Ruíz/Cuartoscuro)
The nation’s busiest airports for international tourism so far in 2023 have been:
Cancún International Airport, with 4.8 million arrivals
Mexico City International Airport (AICM), with 1.9 million
Los Cabos International Airport, with 1.2 million
The three airports saw a total of 8.7 million international tourist arrivals, an increase of 4.4% compared to 2019’s numbers.
Other airports across Mexico received a total of 2.7 million tourists, surpassing 2022’s numbers by 18.3% during the same period.
Cancun Airport has seen the largest number of foreign tourist arrivals in 2023. (Vzmp85/Wikimedia)
However, the sum turns out to be less than its parts: despite higher numbers of tourists arriving by air, the total number of international arrivals to Mexico — which includes land crossings and cruises — is still some 2 million lower than it was in 2019.
Average expenditure numbers by long-stay tourists who arrived by air for the first six months of 2023 wasn’t yet available. However, data from the Ministry of Tourism says that average expenditure between January and April of 2023 was US $10.7 billion, a figure up by 17% compared to that in 2022.
According to a United Nations World Tourism Organization (UNWTO) report released earlier this year, Mexico is the sixth most visited country in the world, down four positions from 2021 when it ranked as the world’s second most visited country behind France.
Overall global tourism has been recovering significantly, according to the UNWTO, but in the first quarter of 2023, it was still down 20% compared to the same period in 2019, according to the organization’s website.
Defense Minister Luis Cresencio Sandoval announced that the airline would fly to 20 national destinations out of the Felipe Ángeles airport in Mexico City. (Gob MX)
The Mexican government will purchase the brand name and some equipment of the defunct airline Mexicana de Aviación, better known simply as Mexicana, for 815 million pesos (US $48 million), Interior Minister Luisa Alcalde announced on Thursday.
The money spent on the airline will be used to compensate more than 7,400 former employees who were left in the lurch when Mexicana went bankrupt and shut down 13 years ago.
The deal was announced at the Thursday morning press conference. (Gob MX)
The deal includes the transfer of three buildings and a flight simulator to the Mexican government, which will then revive Mexicana as a military-run commercial airline.
Starting Aug. 15, payments will be distributed among Mexicana’s former employees, who lost unpaid wages and benefits when the airline filed for bankruptcy in 2010. Before ceasing operations, the flagship company, founded in 1921, was Mexico’s longest-standing airline and one of the oldest in the world.
“Today, a historic agreement was reached to achieve justice for 7,407 Mexicana de Aviación workers, pilots, flight attendants, ground staff, trusted workers and retirees,” Alcalde said at President Andrés Manuel López Obrador’s Thursday morning press conference.
“The Ministry of Labor and Social Welfare (STPS) mediated with the different organizations, who held assemblies and consultations among the people [involved], the workers, to reach an agreement,” she added.
Interior Minister Luisa María Alcalde said the purchase was an “historic agreement”. (Gob MX)
Negotiations between the workers and the government over back pay have been ongoing for about three years. The government firstannounced an agreement to buy Mexicana’s brand and assets at the same price in January, but this stalled over the following months as a group of workers agitated for greater compensation.
In July, President López Obradorhalted the negotiations, saying that the government would not make the purchase while the dispute continued.
“The brand would be in litigation, and we don’t want to buy a lawsuit,” AMLO said at the time. “Instead of the money being evenly distributed, as had been agreed, the lawyers went in, made noise and said no [to the deal]. They go to the judiciary [and] file appeals. And we cannot wait because the airline needs to start operating.”
On announcing the revived deal this week, Interior Minister Alcalde stressed the government’s commitment to “recover[ing] at least part of the compensation [the workers] have a right to.” She blamed the Mexicana debacle on the administration of former President Vicente Fox, whose government was responsible for privatizing the airline, selling it to Grupo Posadas. The airline went bankrupt five years later.
The airline was once state-owned, then transferred to private ownership in 2005 and went bankrupt in 2010. (Mexicana)
“In 2005 …[Mexicana] was privatized by the government of Vicente Fox, passing into the hands of Grupo Posadas, and in five short years they managed to dismantle and bankrupt what was once Mexico’s most important airline,” Alcalde said.
The general secretary of the Trade Union Association of Aviation Pilots (ASPA), José Humberto Gual, praised the current buyout plan as “an act of social justice” and symbolically presented AMLO with a pair of Mexicana pilot wings.
The government plans to relaunch Mexicana with ten Boeing 737-800s, Defense Minister Luis Cresencio Sandoval announced. These will fly to 20 destinations across the country – including Cancún, Guadalajara, Tijuana, Mérida, Oaxaca, León, Puerto Vallarta, among others – out of the Felipe Ángeles International Airport (AIFA), which was opened by AMLO’s administration on the outskirts of Mexico City last year.
Tickets will go on sale starting in September, according to officials.
