By RICARDO CASTILLO
The Return of the Swaps
The U.S. Federal Reserve (Fed) struck a deal with eight national central banks, including the Banco de México (Banxico), to back up dollar-denominated loans in global markets in an attempt to stabilize the exchange market, now under stiff pressure from the Covid19 pandemic.
Banxico issued a press release explaining: “The swap mechanism agreed upon between the Bank of Mexico and the U.S. Federal Reserve is for up to $60 billion dollars. This new mechanism will provide support for the liquidity provision in U.S. dollars and will last for at least six months.”
The Fed said that the swap agreement includes, besides Mexico, Australia, Brazil, South Korea and Singapore within the $60 billion deal, while Denmark, Norway, Sweden and New Zealand struck deals for $30 billion.
Swaps first began during the 2007 credit crisis with top central banks around the globe.
After the derivatives succeeded, the availability of swaps expanded to emergent markets.
The swaps will protect Banxico against credit risk and thus enable it to fund potentially risky ventures and boost economic growth.
Open Borders and Business As Usual
Mexican President Andrés Manuel López Obrador (AMLO) discarded the idea of shutting down borders and airports to stop the spread of the Covid-19 pandemic from entering into the nation from abroad, as it has been the case until now.
“There are pressures of all sorts,” AMLO said in his morning press conference on Wednesday, March 18, “to close everything and paralyze the economy. We’re not going to do it. Of course, we’re worried about the epidemic and we have to take care to protect ourselves from it, But we also have to act in a responsible way.”
Pundits are accusing AMLO of “stubbornness” (to which he admits) for not following suit after Canada, the United States and Guatemala, nations which have closed their borders and are not allowing flights in from Europe and the Far East.
“Our first objective is to safeguard the economy of the poor,” AMLO said.
On Tuesday, March 17, there was a not-so-friendly confrontation between San Salvadorian President Nayib Bukele and Mexican Foreign Relations Secretary Marcelo Ebrard.
Here’s the scoop:
Twelve Salvadoran citizens were among the passengers on board an Avianca Airlines flight that was flying the Los Angeles, Mexico City, San Salvador and Bogota route.
As the plane arrived in Mexico City, Bukele issued an order saying that it could not land in El Salvador because Mexican authorities were irresponsible of allowing 12 “confirmed” Covid-19 virus carriers on board, forcing the cancellation of the flight.
This bothered Ebrard because, after a checkup by Mexican public health officials, all the passengers aboard the Avianca flight, including the 12 Salvadorans, were declared “healthy.”
Ebrard demanded to know from where Bukele got his information.
“That’s the responsible thing to do,” Ebrard said.
Avianca management butted in with a tweet “thanking” Bukele for the alert.
It was then that Bukele sent Ebrard a message of a different diplomatic kind:
“Some other day, I’m going to make a formal complaint about the fugitive from Salvadoran justice (namely Sigfrido Reyes), who is accused of corruption and to whom you’ve given asylum to due to ideological motives.”
After this, the Foreign Relations Secretariat informed that Bukele had gone mum.
AMLO took note of Bukele’s apparent temper tantrum and said that any foreigner, “in case they stay with us, will be given medical attention and protection. If they are infected.”
Teotihuacán Pyramids Closed for Spring Rites
The yearly spring sun equinox energy soaking that’s become a tradition for over 100 thousand people at Mexico’s legendary Teotihuacán pyramids will not be possible this year due to the Covid-19 ban on large gatherings.
For years, many have opposed the high number of visitors at one time and the closure of the archaeological site on March 21 has been suggested, but now, it will actually be implemented.
Both the Mexican Culture Secretariat and the National Institute of Anthropology and History (INAH), along with the Health Secretariat, are behind the weekend closure with a plan to reopen the site “in accordance with the development and behavior of the Covid-19 virus in our nation.”
Guatemala on Guard
The government of Guatemala announced on Tuesday, March 17, that it was creating a medical sanitary watch line on ports of entry from Mexico to oversee the health and temperature of people coming into the nation.
The bridges with the control watch line are the Rodolfo Robles and El Carmen-Talisman bridges.
As if it wasn’t enough for former Social Development Secretary Rosario Robles to be in jail awaiting trial for embezzlement, the Mexican Chamber of Deputies accepted a proposed political trial for her performance as a federal official “due to omissions and irregularities” during her service from Dec. 1, 2012 to Nov, 30, 2018, that is, during the administration of former Mexican President Enrique Peña Nieto.
No specific charges have been mentioned as of yet, but with alleged violations to Constitutional Articles 126 and 134, as well as to Public Servants Responsibilities laws and alleged wrongdoings in the Budget and Treasury administrative responsibilities and illegalities in the acquisition, renting and services for the government, there is plenty of room for investigations.
Namely, the charges will constitute the rest of the book that the government has already thrown at her.
The question now is if Robles can escape from the coming punishment, which will mean a lot of years in jail.
Sports: The MX Soccer League “Pause”
Mexican MX Soccer League president Enrique Bonilla has taken a “wait-and-see” attitude to the Covid-19 threat that, at least in Mexico, has not taken the pandemic size it has in other nations all over the world, leading to the cancelling of soccer activities all over.
The “pause,” as the wait-and-see period was being called as Week 10 of the season was played last weekend in empty stadiums, has created the idea that if bad leads to worse, the entire season will be cancelled, awarding the championship to current standings leader Mexico City team Cruz Azul.
“That’s not going to happen,” Bonilla said about handing the championship over to Cruz Azul-
“We are working on different scenarios to be able to recover the time lost during the pause.”