Mexico News Roundup
By RICARDO CASTILLO
First USMCA Investment
The Canadian firm Bombardier Recreational Products (BPR) announced on Thursday, July 2, the construction of a plant in Ciudad Juárez, Chihuahua, which will build four-wheel-drive vehicles, making it the first investment of the new era of the United States-Mexico-Canada Agreement (USMCA).
The announcement was made in Mexico by the Economy Secretariat, claiming that the plant will create “at least 1,000 new jobs” and that the total upfront investment was for $185 million Canadian dollars, around $136 million U.S.
“Despite the pandemic, demand for our products has remained strong, and even surpassed last year’s figures for the same period,” said José Boisjoli, Bombardier president and CEO.
“Our continued innovation and steady growth in side-by-side vehicles (SSVs) make this additional capacity necessary to meet our goal of achieving a 30 percent market share”, Boisjoli was quoted as saying in a company press release.
Site planning and construction are scheduled to begin within the next months, and the plant is expected to be ready for operation by fall 2021.
Surprise! Remittances Are Up
Remittances from Mexicans working in the United States amounted to almost $3.8 billion during May, an 18 percent increase over the same month last year.
The surprising amount was hailed both by Mexican President Andrés Manuel López Obrador (AMLO) and by the recipients, who have seen their income grow in pesos by 23.8 percent due to currency devaluation, the central Banco de México (Banxico) said on Wednesday, July 1.
Banxico also said that the accumulated amount of remittances for the first five months of 2020 was $15.537 billion, an increase of 10.42 percent over the same period last year, when the amount was $14.071 billion.
A breath of fresh air in the barrage of bad financial stories!
Aeroméxico Files for Chapter 11
Mexico’s flagship airline Aeroméxico and some of its branches filed for a restructuring under U.S. Chapter 11 Bankruptcy Law.
The airline said it would continue to fly its usual routes.
The objective of the filing was to strengthen airlines’ finances and make the necessary adjustments to confront the negative impact the covid-19 pandemic is having on the travel business as a whole.
“By filing for Chapter 11 protection we hope to create a new sustainable platform that will allows the transition with success in the uncertainty of the global economy.” said Grupo Aeroméxico President Andrés Conesa.
Conesa said the airline will contract a preferential DIP financing loan.
On the Mexican Bolsa de Valores stock exchange, Aeroméxico stock plummeted by 27 percent on Wednesday, July 1, to end the day at 4.1 pesos per share, given that protection in the United States only covers the company’s top five creditors.
The airline will have to deal with Mexican creditors on its own.
Famsa Bank is Kaput
Treasury Undersecretary Gabriel Yorio on Wednesday, July 1, announced that the license to operate as a savings bank issued to the furniture store chain FAMSA had been cancelled due to an apparent series of shady deals.
The bank is now under liquidation.
Yorio said that the cancellation and liquidation does not represent a risk to the Mexican financial system and the official Bank Savings Protection Institute (IPAB) covers the savings of the 580,774 customers of the bank under the law.
The president of the National Banking and Stock Market Commission Juan Pablo Graf Noriega said that the money movements in excess of legal limits were detected since 2019 as well as other irregularities, including insufficient reserves.
Mexican Tourism Secretary Miguel Torruco Marqués announced a promotional effort to be made in cooperation with the U.S.-based organization Migrant Power to promote the nation among Hispanic immigrants using the web platform www.visitmexico.com.
The campaign is labeled Think about Mexico (Piensa en México) and is one of several efforts to hopefully attract tourists to places that have been economically ravaged by the covid-19 pandemic.
Torruco said that, in normal years, the number of Hispanics, mostly of Mexican descent, visiting the nation was about 35 million, representing a hefty chunk of all U.S. visitors to México.
Mochomo Released and Rearrested
The man accused of being the leader of the Guerrero heroin trafficking gang that goes by the name of United Warriors, José Ángel Casarrubias, aka “El Mochomo.” was released from the maximum security jail El Altiplano in the State of Mexico.
El Mochomo is believed to be the key suspect in ordering the disappearance and possibly the execution of 43 normal school students on Sept. 26, 2014.
A judge set El Mochomo free on grounds that there was not enough evidence to take him to trial on charges of criminal organization.
The release irked AMLO, who, on Thursday, July 2, outright said that the judge had been bribed and that he could prove it.
The name of the judge has not been released.
Fiscal General agents rearrested El Mochomo on Wednesday, July 1, as he was leaving the prison grounds.
Sports: No Baseball, No Marathons
In two separate events, authorities announced the definite cancellation of the Mexican Baseball Season, as well as the Mexico City Marathon and a half-marathon.
“Without a public, there is no game” said Mexican Baseball League president Horacio de la Vega after meeting with the 16-team owners.
“It would have been irresponsible to summon thousands of people to a stadium when there is a pandemic going on.”
Meanwhile, the Mexico City Sports Institute announced the cancellation of the programmed traditional Mexico City Marathon on Aug.30, and the Half Marathon programmed for Oct. 25.
“Conditions are not there to guarantee the health of the runners and public given the covid-19 pandemic,” the Sports Institute announced.
…July 3, 2020