Category: Regions

Mexico’s lower house of congress voted 360 to 127 to remove Mexico City Mayor Andrés Manuel López Obrador from office to face charges of disobeying a court order, which could derail his 2006 presidential bid. López Obrador called on his supporters to peacefully resist what he called an unjust, politically motivated attempt to derail his presidential campaign. He specifically accused President Vicente Fox of conspiring to block his candidacy. Yields on Mexico’s ten-year dollar bonds have widened out by 100 basis points since hitting a record low on February 10th.

Mexican consumer prices rose 0.45% in March as higher international oil prices pushed up prices for gasoline, natural gas and jet fuel. The Central Bank also said prices for agricultural goods are rising. However, the core inflation rate, which excludes volatile energy and food prices, fell to 0.31% last month from 0.42% in February.

There are many reasons to dislike Mexico City’s mayor Andrés López Obrador. He is a populist and a nationalist with retrograde ideas on economic policy. Amlo, as the mayor is known, believes in democracy but centralizes power in his own hands. He is personally honest, but surrounded himself with crooks. Yet to even consider barring the country’s most popular politician from running in next year’s presidential election shows how insecure Mexico’s ruling elite has become. His impeachment will begin Thursday on charges that he ignored a court order stopping the city from building a hospital access road on private land.

Mexico is Latin America’s biggest economy and one of just three in the region with an investment grade rating. But its political sophistication lags far behind Brazil, Colombia or Chile. The Revolutionary Institutional Party ruled Mexico for 71 years until the current conservative government of President Vicente Fox took office in 2000. Removing Amlo from the race would ensure the PRI’s return to power.

He has promised a campaign of civil disobedience if he is removed from office and prevented from running for president. Markets are in turmoil as well they might. Economic upheaval often coincides with government changes. The next government’s legitimacy would suffer if Amlo is barred from the election. Mexico is no banana republic, so it should stop behaving like one. It cannot hope to evolve into a modern and sophisticated state until its politicians grow up.

Mexico’s state oil company Pemex plans to issue up to 20bn pesos (US$1.8bn) of bonds, most of which will have variable interest rates, in the second quarter this year, the company said in a statement.

Wal-Mart de México boosted profits by 35% in the first quarter, thanks to Mexico’s biggest surge in consumer spending in four years. Net income rose to $166 million. March same-store sales rose 9.5% versus a decline of 2.7% a year earlier. Retail sales rose more than 6% a month between September and January. Walmex wants to open 70 new stores this year.