They’re watching the president closely amid uncertainty about what he might do next

by Mexico News Daily

Fear and uncertainty about the policy agenda of President López Obrador are paralyzing investment, according to high-ranking business executives who spoke to the news agency Bloomberg.

A report published today said that about half a dozen executives who met with Bloomberg in Mexico City last week described navigating the president’s policies and abrupt pronouncements as a struggle.

The most common word that the executives used to describe López Obrador’s decision-making process on issues that affect them was “erratic,” Bloomberg said.

Speaking on the condition of anonymity, most expressed support for the government’s implementation of austerity measures and its crusade against corruption – many said that the scourge spiraled out of control during Enrique Peña Nieto’s presidency – but rejected the decisions to cancel the Texcoco airport project, freeze new energy auctions and take legal action that seeks to annul clauses in natural gas pipelines.

Amid uncertainty about what the president might do next, the executives said they closely watch López Obrador’s daily press conferences for clues.

In that context, no one is investing, they said. Many of the executives said they see the beginning of a downward economic trend for Mexico although their views differed about how steep the slope will be.

In any case, the situation raises a range of questions, Bloomberg said: “Invest now? Wait to invest? Simply keep the business on autopilot or consider selling assets? Put resources toward other countries?”

Gross fixed investment in Mexico fell 7.4 percent in May, the worst monthly performance in more than two years, while the economy only narrowly avoided entering a technical recession by recording 0.1 percent growth between April and June after a 0.2 percent contraction in the first quarter.

Although López Obrador has clung to his forecast of 2 percent growth in 2019, his own government predicts an expansion of just 1.1 percent.

The International Monetary Fund slashed its growth outlook for the Mexican economy to 0.9 percent from 1.6 percent last month while the Bank of America and Citibanamex cut their forecasts to just 0.5 percent and 0.2 percent, respectively.

Bloomberg said that the “mix of AMLO’s austerity drive and the uncertainty among business leaders” is taking a heavy toll on the economy.

The news agency noted that while the president is curtailing government spending in many areas, he has allocated significant funding to Pemex, the beleaguered state oil company.

It questioned the logic of building a new oil refinery on the Tabasco coast when existing refineries are operating at or below 30 percent capacity.

Considering the president’s track record on canceling and challenging investment projects, Bloomberg said the business community is waiting for “a sign – any sign” that López Obrador can generate an economic and legal environment in which investors have the confidence they need to make decisions.

The news agency noted that the president told its editor-in-chief John Micklethwait in an interview last week that he respects contracts and the need for foreign investment but added that “for the executives, actions speak louder than words.”

Source: Bloomberg (en).

Mexico considers legal action against US after 8 Mexicans die in El Paso

Mexico could obtain access to evidence revealed by the investigation and prosecute the shooter

Mexico is looking into taking legal action against the United States over the murder of eight Mexican citizens in a mass shooting in El Paso, Texas, on Saturday.

Foreign Affairs Secretary Marcelo Ebrard told a press conference Sunday that Mexico is considering the mass shooting an act of terrorism against the Mexican-American community and against Mexicans in the United States, and that the attorney general is exploring legal action that would rule the shooting as such.

Designating the attack as an act of anti-Mexican terrorism would give Mexico access to all the evidence that comes out of the investigation into Saturday’s shooting. Ebrard said that such a designation would be the first of its kind.

“There will be legal action against whoever ends up being responsible for the sale of the assault weapons to the person responsible, and whoever pulled the trigger,” said Ebrard. “We are going to request access to the investigation to find out how the weapon was sold and how it got into his hands.”

A total of 22 people were killed in the shooting, which took place at a Walmart in the Cielo Vista shopping center in El Paso. The shooter has been identified as 21-year-old Patrick Crusius, of Allen, Texas.

Authorities say Crusius is the author of a 2,300-word “manifesto” posted to the message board 8chan before the attack, which speaks of an “invasion” of Mexican and Latino immigrants into the United States.

Ebrard added that Mexico will send a diplomatic note to the United States asking it to “take a clear position against hate crimes,” and that Mexico will consider requesting that Crusius be extradited to Mexico to face charges for the murders of Mexican citizens.

“Mexico considers this individual to be a terrorist,” he said.

Ebrard was scheduled to travel to El Paso on Monday where he was to meet with Mexican consuls from around the United States.

Source: El Universal (sp), CNN (en).