By RICARDO CASTILLO
Banxico Foresees -8.8 Growth for 2020
The Central Bank of Mexico (Banxico) presented three separate scenarios for the country’s 2020 economic growth, marking a drastic difference between the “benevolent” and the “drastic” potential outcomes.
Banxico’s benevolent forecast said that the Mexican gross domestic product (GDP) would slump by “only” -4.2 percent, while the drastic one put the decline at -8.8 percent.
Banxico said that the broad differences reflect “the deep uncertainty” to which the Mexican economy is currently being subjected, as well as the different trends and variables the GDP could have.
Banxico Governor Alejandro Díaz de León Carrillo acknowledged that, to begin with, the world’s economies are in a generalized contraction.
Added to that factor is the almost-zero growth Mexico was already expecting in 2020 before the coronavirus pandemic, provoked mostly by a lack of private sector investment.
Díaz de León Carillo also noted that, in 2009, Banxico had forecast by mid-year a -8.2 GDP growth, but that at the end of the year the final gauging by the National Institute of Geography, Statistics and History (Inegi) put the figure at -6.5 percent, the steepest since the Great Depression.
Still, the Banxico official said that the -8.8 percent scenario is for now a feasible drop, given the nation’s dire economic problems and the covid-19 pandemic that has brought the economy to a halt.
On the other hand, Díaz de León Carillo said that the economy might rebound by a growth of 4.1 percent in 2021, provided economic activity gets back to normal.
Banxico Vice Governor Jonathan Heath, who participated in a Wednesday, May 27, press conference at the National Palace, commented that the current policy implemented by Mexican President Andrés Manuel López Obrador (AMLO) of not accepting loans from international credit organizations is the correct path for the nation to follow.
Many countries today, he said, are opting for acquiring short-term debt, but once they get it, they will suffer “a hangover” trying to resolve their fiscal problems.
The current Mexican administration is trying to deal with recovery without taking that path.
As an example of what could happen, economist Heath recalled the Mexican 1982 crisis, in which money was borrowed betting on a bailout.
However, besides high inflation due to excessive money printing, the bailout took the government 10 years to pay off, at increasingly higher interest rates and servicing fees due to inflation, which rose by a whopping 159 percent in 1987.
Movement to Remove AMLO
The board of directors of the nationwide supermarket chain Soriana voted by a majority to remove partner, founding member and administrator – and the owners’ family member – Pedro Luis Martin Bringas.
The reason for the decision was thatMartín Bringas recently decided to form a political opposition front whose ideology and methodology are unclear.
On Thursday, May 7, Martín Bringas admitted that he is the leader of a movement called National Anti-AMLO Front (Frena), whose main objective is to oust AMLO from power by next December.
“I have accepted to be the leader of the National Front for the Removal of President Andrés Manuel López Obrador after a deep analysis, both of his objectives and the way he seeks to achieve those objectives,” Martín Bringas said in a video.
Martín Bringas did not detail “the ways” he would accomplish that goal.
Political opposition is not a crime in Mexico, so he and followers have the right to work for that objective.
But in a year without meaningful elections and because Frena has not started any political litigation to remove a sitting president from power, his move is suspect, not so much as to the what, but as to the how.
Morena Audits Polevnsky
The National Executive Committee of the majority National Regeneration Movement (Morena) announced that it is auditing the Morena accounting during the four years Yeidckol Polvensky was its national president.
Human Rights Secretary Carlos Figueroa said that there is a group of Morena members who are asking to have the audit, even though Polevnsky presented the accounting during a recent meeting.
He said that the group thought her report was insufficient and requested more info.
Figueroa, however, said he suspects that the move is related to plans to purchase several buildings Morena currently uses as office, and efforts to exclude Polevnsky from the Morena list of candidates for president, soon to be released.
Morena must vote for a new president before Sept. 1, when the official electoral process for the June 2021 midterm elections begins.
AMLO Thanks Walmart
The back taxes payment of over 8 billion pesos made last week by Walmart de México represents a rectification in the positioning many companies had to not paying taxes and “the recognition” that things have changed, AMLO said during his morning press conference on Thursday, May 28.
Other companies that AMLO said still owe over 40 billion pesos to the government in back taxes “are seeking conciliation.”
“They are all on a path to making a deal,” he said.
“The majority do not want a legal fight and I celebrate and recognize that. This is not about ending in court fights, but just complying with what is established in the law. If they don’t comply with paying, we will have to then proceed with civil and criminal suits.”
AMLO referred to the fiscally delinquent companies as “lost sheep coming back into the fold.”
“For now,” he said, “I offer my appreciation to Walmart.”
Mexico City, Intubated
Mexico City Mayor Claudia Sheinbaum, in response to the demand by many governors to open up for business, said that “there’s no conditions to go back to normal” in the city.
“We continue with a high contagion risk,” she said.
“And it is important to keep all measures of safe distancing.”
Cancun to Reopen
Hotel representatives and Quintana Roo state tourism authorities presented a plan to reopen to business on June 7 under the advertising campaign banner of “Come2MexicanCaribbean.”
The area under consideration includes Cancun, Isla Mujeres, Puerto Morelos, Mara Lezama, Juan Carrillo and Laura Fernández, all hoping to reach a 50 to 55 percent occupancy during the summer season.
Over 200 hospitality industry companies participated in the plan, spurred on by the Global Safety Stamp issued by the World Travel and Tourism Council.
Sports: Soccer Mourning in Morelia
Morelia Monarchs soccer fans are challenging the covid-19 lockdown loudly in the streets of that city and the imminent sale of the local soccer franchise, which will now be called the Mazatlán Football Club.
The Monarchs were owned by Ricardo Salinas Pliego, who just couldn’t say no to a better business offer from the state government of Sinaloa to sell the franchise.
Protests include calls for a boycott of Salinas Pliego utility stores Elektra and Azteca Bank which, receives regularly remittances from Michoacán expats in the United States.
In the middle of the crisis created by the void of the Monarchs’ exodus as a franchise, several business people have gathered to ponder as to how to come up with a proposal for a new team and present it to the Mexican Soccer Federation, which rules over the Mexican Soccer League.
No soccer team in Morelia is tantamount to no mariachis in Guadalajara.
Consequently, Morelia is in mourning, and not because of the covid-19 pandemic.
…May 29, 2020