Analysis Agenda. 22 July, 2013.

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For the first time in over two decades, expectations regarding structural reforms in Mexico seem to drift away from being promises and start flirting with an eagerly awaited materialization. Even though the first post-revolutionary power alternation in 2000 generated similar hopes, it was almost immediately followed by disappointment mainly due to two essential factors: one, the reluctance of PRI – then in opposition – on allowing the PAN administration to carry out its political agenda; and two, the disappointing paralysis of a party that sold the image of a statesman on campaign and only ended up selling illusions. That way, between the negligence of some and the inability of others, the country has lost a valuable time in a rapidly changing world. Nowadays, the PRI restoration is a reality. However, so is the party plurality, whose main function will be to provide counterweight and enrich government work, something that PRI members couldn’t manage to do once they were out of office.

1-PAN’s energy proposal: the longest possible stretch. On July 18th, the PAN national leadership released its project of energy reform. It is not sure that all groups within the party will back it up, particularly the Senate “dissidents”. On the other hand, the content of the initiative, whose precepts barely avoid the privatization of the country’s essential resources; it also presents controversial suggestions that range from the transformation of PEMEX to a company that fits more into the oil process’ competition scheme, the concessions to public, private and public/private entities to a formula of managing the company’s working liabilities (a potential blow to its union) and the empowerment of the Energy Secretariat as well as the National Hydrocarbon Commission. What is the feasibility – both politically and operatively – of this proposal? Where does it stand within the context of the future Presidential energy proposal?

2-The opposition’s political reform project in the Senate: raising the costs of voting. On July 17th, the most important PAN and PRD Senators presented 31 proposals that would modify not only the current electoral regime but the basis of all the political system. It is said that the aforementioned reforms would be backed by at least 46 of the 128 Senators – which, apparently, wouldn’t be too useful, especially regarding any modification to the Constitution. Ernesto Cordero, as Senate President (a position to be held until August 31st), has stated his intention to discuss the political reform in the extraordinary period of the aforementioned Chamber on next August. When considering that all Constitutional reform carried out by the federal government wouldn’t pass the Senate filter without the support of those who back the opposing political reform, how could the latter work as a negotiation mechanism between Executive and Legislative powers in the face of energy and tax reforms?

3-The new Progressive Movement (Marcelo Ebrard version). On July 20th, the former Mayor of Mexico City has once again got into the limelight with the announcement of the formation of his own (official) political group within PRD. Even when the current Mexico City Mayor, Miguel Ángel Mancera (who by the way is not affiliated to the party), was absent from the official act, it certainly caught the attention that both PRD national leader, Jesús Zambrano, as well as members of the powerful René Bejarano faction, such as Dolores Padierna were present. Ebrard was notorious for challenging President Peña with a debate on energy reform, a wave which the former seems keen on surfing in order to obtain national exposure (his weak spot). In its future intention to be PRD leader, how will Ebrard manage to revive a party with decreasing government posts and, most importantly, with the threat of losing members with the future emergence of MORENA (Andrés Manuel López Obrador’s party)?

4-The informal sector: the country’s third biggest pending task. Even though media attention is focused on energy and tax reforms as Mexico’s potential growth engines, a fact that the aforementioned law modifications will not be able to solve: informality. During the official presentation act of the 2013 Program for the Formalization of Employment, President Peña acknowledged that 6 out of 10 employed workers are outside the ranks of the formal sector, one that does not include social security (medical service, retirement savings and house financing). Even though the recently approved labor reform would force the flexible procurement schemes (both per hour and professional fees) to provide regular benefits to its workers, it hasn’t been completely clarified. Will this new National Crusade against Informal Employment materialize beyond simulation?

5-Enrique Peña’s (tacit) security strategy. The apprehension of the leader of the crime group Los Zetas, the so-called Z-40 (AKA Miguel Ángel Treviño) has been considered as the main achievement of the current administration regarding drug trafficking. It has also been mentioned a lot the change regarding the presentation of the act upon public opinion (in principle, without media montages). Nevertheless, this behavior is merely a symptom of a true modification in which the war against crime is being handled. Besides not being the government’s trademark anymore, PGR (Mexican Attorney’s Office) has assumed a more cautious role with its operations, which have been successfully centralizing around the Secretariat of Interior and, in relation with the latter, the cooperation with the U.S. tries not to be as intense as it is effective. What are the main implications of this new style on security issues?

Antonio De la Cuesta

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