CEO’s Executive Summary:

Two highly controversial legislative proposals dominated our attention this past month: one would have reduced the Mexican central bank’s autonomy and opened the door to money laundering in Mexico, and the second tightly regulates the activities of U.S. DEA agents on Mexican soil. Both drew sharp rebukes, but only the Bank of Mexico legislation was temporarily defeated, with final consideration of this reform postponed until early February. The new national security law passed on the final day of the congressional session, a very worrying development for U.S.-Mexico security cooperation.

In other key developments, following the electoral college vote in the United States, Mexican President Andrés Manuel López Obrador (AMLO) finally sent a congratulatory letter to U.S. President-Elect Joe Biden. Delivered on the same day as approval of the national security law, the letter’s luke-warm and somewhat contradictory contents suggest the possibility of a return to a somewhat prickly bilateral relationship. At the same time, the replacement of Mexico’s respected ambassador to the United States with one with little to no diplomatic experience raises questions about the weight AMLO places on this essential bilateral relationship.

In other domestic maters, final consideration of the outsourcing proposal we discussed last month was postponed until February. AMLO made significant changes to his economic team soon after the 2-year anniversary of his inauguration. And, in politics, Mexico’s three main opposition parties agreed to form an electoral alliance in advance of the 2021 mid-term elections. While national and state-level polls continue to show an edge for AMLO’s Morena party, this new alliance will give the opposition a much better chance to cut into Morena’s legislative majority and to win several of the 15 governorships up for grabs in June.

Full Newsletter: Monarch News – December 21, 2020

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