This was supposed to be the year when Mexican growth got better, after last year’s dismal 1.1 per cent. Yet economists at Banamex have chopped a half-point off their 2014 forecast. What’s going on?
Let’s blame it on the weather. Literally. Here’s Banamex:
The main factor behind this revision is the effect that the exceptionally adverse weather conditions will have on activity in the US.
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Never mind all that “three amigos” stuff. A potential energy pipeline from Canada to the US could help those two Nafta members, but not the other, Mexico.
The proposed Keystone XL pipeline could spell bad news for Mexican oil company Pemex, which is losing its monopoly at home and is currently the third biggest crude exporter to the US. Continue reading »
Oil companies hoping that by March 21 they might have clues as to which oil and gasfields may be up for grabs in Mexico should not get their hopes up too high.
Pemex, the state company which is having its 75-year-old monopoly opened up to private competition in a historic reform, will face a new competitive environment. And that means learning to keep corporate secrets, it says. Continue reading »
Consumerism seems rife in Mexico – stores bustle with shoppers and promotions designed to lure customers and keep them hooked are legion. So it’s no surprise that retail sales rose in December, on an annual basis, more strongly than expected.
But compared with November, which was a strong month for retail sales because of the success of the annual “Good Weekend” sales spree, the picture was not so pretty. Continue reading »
One step forward, one step . . . well, if not exactly backwards, sort of sideways?
Mexican inflation data for the first fortnight of February looked a lot brighter than a month ago, when the impact of new taxes, including on fizzy drinks and junk food, pushed consumer prices to an eight-month high. Continue reading »
The Mexican economy grew by 1.1 per cent in 2013, its slowest rate since the 2009 recession and well short of the 3.5 per cent that President Enrique Peña Nieto initially expected during his first year in office.
In the fourth quarter, GDP expanded 0.2 per cent seasonally adjusted, due to slower growth in industrial sectors. The pace of expansion was significantly below market expectations for 0.6 per cent growth, leading to concerns over the health of the North American economy. Barclays Capital said the weak growth was probably the result of slow US imports and a “still fragile domestic consumer”.
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What happens when you put together three countries which account for nearly a quarter of the world economy, with trade exchanges worth $1tn a year? Ever greater competitiveness, prosperity and dynamism – that, at least, was the message from the leaders of the US, Canada and Mexico at their annual summit.
And Barack Obama, Stephen Harper and Enrique Peña Nieto – the “Three Amigos” – stuck relentlessly to the script, highlighting trade flows, the prospect for cooperation in security, competitiveness, greater educational and science exchanges, deeper integrated manufacturing supply chains. Continue reading »
By Eric Farnsworth of the Council of the Americas
In office barely a year, Mexico’s president Enrique Peña Nieto is pursuing aggressive reforms for breakout growth through greater competitiveness. Washington should do all it can to help him succeed, because Mexico’s expansion is good for the US.
Already our second largest export market after Canada, US imports from Mexico contain some 40 per cent of US content (from China it’s 4 per cent). In many industries, joint production and supply chains have developed to such an extent that we don’t just trade things together, now we design and make things together, in high value-added products like aerospace, automobiles, and sophisticated medical equipment. Production in Mexico and a growing middle class creates good jobs in the US and vice versa, increasing economies of scale and building North American competitiveness in the face of continued competition from China and elsewhere. Continue reading »
One of Mexico’s reform plans is under attack and there are investors who want it derailed.
Don’t panic – it’s not energy, the crown jewel of the reform package pushed through by the government last year, for which a kind of steering committee of legislators and officials are busy drafting secondary legislation they hope to have ready by the end of the month.
Nor is it one of the other five big reforms passed last year: financial, tax, education, telecoms and labour reform. Continue reading »
Enrique Peña Nieto
Enrique Peña Nieto, Mexico’s president, has another new strategy to combat crime in the volatile western state of Michoacán: throw money at it. Continue reading »
It would be exaggerated to call Davos the “money Oscars”, as Jon Stewart did on the Daily Show. But this year, WEF participants did like to think of countries as winners or losers, especially among emerging markets. In this last roundup, beyondbrics summarises who, to paraphrase the FT, “was hot – and who decidedly not.”
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Mexican reforms have started to make themselves felt – though not in the way consumers would like.
Stoked in part by a new soda tax, a hike in VAT in border areas, and a reduction of fuel subsidies, Mexican inflation has hit an eight-month high. Continue reading »
Cemex, the Mexican cement giant, is breathing a little sigh of relief.
It had been biting its nails ahead of a ruling from an Egyptian appeals court on whether its 1999 purchase, in a privatisation, of Assiut Cement Company (ACC), should stand. Continue reading »
Lufthansa, the German airline, summed up the contract dispute raging at Mexico City’s airport this week: its boss said he had no clue with whom he should be signing a lease for rental of terminal space.
Why? Airport operator AICM and Fumisa, an infrastructure company controlled by international private equity fund Advent, are at loggerheads over contracts – and they’re now at the “we’ll see you in court” level. Continue reading »
Pity the poor Mexican peso. Despite the view in the market that Latin America’s second biggest economy is set to outperform its emerging market peers in 2014, the currency has been taking it to the chin since the start of the year. Continue reading »