AMLO Reveals Deal for Railway Appropriation with Grupo México

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After much controversy surrounding the Mexican government’s appropriation of 120 kilometers of railway owned by Grupo México subsidiary Ferrocarril del Sureste (Ferrosur), President Andrés Manuel López Obrador (AMLO) confirmed that “a good agreement” had been reached between the two parties, revealing the details behind the compromise during his daily morning press conference on Thursday, June 1.

“It was a very favorable arrangement, I am very happy because it is a railway in a strategic region. It returns to the nation well,” said AMLO at the time.

According to López Obrador, who held his conference from the state of Tamaulipas, Grupo México has volunteered to temporarily concede the 120 kilometers of tracks on Ferrosur’s southeastern Tehuantepec Isthmus Railroad to the Secretariat of the Navy (Semar) in exchange for an extended eight-year concession period for this same stretch of tracks spanning from 2036 to 2044.

“The concession was determined by an appraisal by the Institute of Administration and Appraisals of National Assets (Indaabin), divided by the original price, with the inflation index updated for the years passed, and that amount was translated into an eight-year extension,” explained Secretary of the Interior Adán Augusto López Hernández. “Ferrosur has agreed to pay a right-of-way fee of 4.10 cents per wagon and 8.15 cents per locomotive to the Semar.”

As AMLO had hinted the day prior, Grupo México will receive no financial compensation for handing over the 120 kilometers of railway. Instead, the conglomerate will receive the aforementioned eight-year concession period and a “tunnel type” permit granted to Ferrosur stretching from Medias Aguas, Veracruz, to Salina Cruz, Oaxaca.

The López Obrador administered tallied another win in the agreement, with Grupo México agreeing to withdraw a lawsuit it had previously filed against AMLO’s controversial megaproject, the Tren Maya tourist train.

The agreement was reportedly ratified Wednesday night by Ferrosur, Semar head José Rafael Ojeda Durán, Secretary of Finance Rogelio Ramírez de la O and López Hernández.

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