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The reforms proposed by the president Andres Manuel Lopez Obrador which will be discussed at the start of the new ordinary period of Sessions on September 1stare very high economic risk for Mexico and its corporate sector, warned an analysis of the Bank Of America (BofA).
The study said that eliminating autonomous bodies as proposed by the so-called Plan C (which plans to make 18 reforms), changes in the structures of Pemex and the Federal Electricity Commission (CFE), will generate great volatility in the short term, since all these changes are expected to be approved.
Although the bank did not make any changes to its investment portfolios in the country, it warned to be aware of the last 90 days because of the implications that these movements could have.
Regarding judicial reform, Bofa said that these are the most important changes being considered, because this will have a huge impact on how democracy works.
“The most worrying and consequential reform presented in Plan C is the constitutional reform to review the judicial system, with the aim of eliminating the 7,293 judges in office in Mexico, as well as the 11 judges of the Supreme Court. AMLO’s main objective “That all judges in Mexico be elected by popular vote,” the US bank said.
Meanwhile, Citibanamex launched a special analysis on judicial reform and overrepresentation in Congress, highlighting that the government of Andres Manuel Lopez Obrador advanced with gradual but inexorable steps, throughout the entire six-year term, “a process of weakening and capturing the electoral authorities.”
He explained that having won 54% of the vote for federal deputies, the Morena coalition seeks to control 74% of the seats in that chamber, an overrepresentation of 20 percentage points for the coalition, “clearly in violation of the spirit of the constitution on the matter.”
Sergio Kurczyn, from the bank’s analysis area, stressed that the wording of Article 54 of the Constitution is imprecise and, therefore, the authority applies it reasonably; for example, the same article says that each party must register at least 200 candidates for deputy by relative majority in order to then have the right to receive plurinominal deputies.
“Only Movimiento Ciudadano did it, the authority accepted the requirement for the others as a coalition, not party by party. This validation will allow all of them to receive plurinominal deputies this week. If the government and the Morena coalition insist on an interpretation literalist Accordingly, according to article 54 of the Constitution, the distribution of plurinominal seats should not be requested.”
He stressed that if the overrepresentation of the Morena coalition is approved, the legitimacy of the polls would serve to cement the Constitution a new configuration of the rules of social, economic and political exchange, a new regime.
The contours of this, which are already evident, could mean the cancellation of liberal democracy, based on the State of law and governed by the periodic electoral change of majority governments and solidly counterbalanced.
These calls from Bofa and Citibanamex join those from Morgan Stanley, which lowered its recommendation for investing in Mexico.
Even the Business Coordinating Council and other business chambers warn of short-term damage to the national economy as these reforms advance.
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2024-08-28 20:24:33