Top ten: Economic mistakes in the first 100 days of AMLO

First 100 days account of the presidential decisions that have had an impact on the economy.

1.- Cancellation of the New Mexico International Airport (NAICM).

Javier Jiménez Espriú, head of the Secretariat of Communications and Transportation (SCT), in February assured that the cost of canceling the NAIM in Texcoco would not exceed 100 billion pesos. However, the cost will have to be paid by all Mexicans, at least, for 21 years.

2.-Realization of a refinery without cost-benefit evaluation.

According to columnist Carlos Loret de Mola, in the area of ​​the Gulf of Mexico, where an eventual refinery would be made in Dos Bocas, Tabasco, there are at least 60 more refineries in operation, mainly in Texas and Louisiana. In addition, the Mexican Petroleum Institute, through a study requested by the new administration, stressed that the refinery is not profitable, since its cost would rise to 14,000 million dollars, payable in several decades. Even the columnist says it would be better to buy a refinery used in Texas, of the several that are for sale with more profitable schemes.

3.- Cancellation of support for Magical Towns and CPTM.

In the Budget of Expenditures of the Federation (PEF) 2019 contemplated the cancellation of resources for the Magic Towns program, and for its liquidation, destined 589 million pesos for the 121 Magic Towns of the country in this 2018; However, specialists in tourism highlighted that the measure represents a setback in tourism, as well as the cancellation of the Tourism Promotion Council in the country.

4.- Delays in the delivery of works: Tren México Toluca and Línea 12.

On tour, the now President of the Republic said that all unfinished infrastructure works would be given priority, however, a few days ago, the head of the Government of Mexico City, Claudia Sheinbaum, said that to conclude the expansion of Line 12 of the Metro -with which the train will share terminal in the Observatory- will require 25,000 million pesos, after meeting with President Andrés Manuel López Obrador. By 2019, only 3,000 million pesos would be allocated.

5.-Cancellation of energy auctions.

Cancellation of the Rounds that in hydrocarbons were planned for this year in the Energy Reform. Likewise, the cancellation of the Fourth Auction was bad news for the investment in renewable energies. Globally, Auctions are the instrument that has gained most popularity in recent years to support the transition to clean energy. From 2005 to 2013, the number of countries that implemented auctions went from 7 to 45. By 2017, this number was already 84. In Mexico, demand for electricity is expected to grow dramatically, however, the government is committed to polluting energies .

6.- Control of the state economy through superdelegates.

The federal public administration that began in December premiered the legal status of General Coordinator of Integral Development Programs, a position that was created so that Andrés Manuel López Obrador controls 32 superdelegates who will carry social programs in the entities and who will be liaison between the governors and the president, which has not existed in any other administration. However, the scheme has been strongly questioned by the governors, as they refer to the use of political and economic control. David Alfaro, governor of Jalisco, has been one of the most critical to this scheme.

7.- Economic impact due to gasoline shortage and railway blockade.

Another mismatch to the economy was the shortage of gasoline. According to the Confederation of Industrial Chambers (Concamin), the measure had a cost of 20,000 million pesos to the national economy, apart from the social uncertainty that several entities experienced during the contingency, although the measure enjoyed great popularity among the population. Also, in Michoacán there was a blockade of railways that caused much impact on the transport of goods that will have an impact on the state economy.

8.- Insufficient support program for Pemex.

Petróleos Mexicanos (Pemex) tops the list of the most indebted oil companies on the planet, above Brazil’s Petrobras and Venezuela’s PDVSA. In February, the Federal Government presented a “Pemex Strengthening Plan” to inject fresh resources and reduce its fiscal burden . However, the rating agencies considered that they were insufficient measures.

9.- Greater social spending.

The three flagship social programs of President Andrés Manuel López Obrador, will require at least 250,000 million pesos to grant subsidies to young people, seniors and people with disabilities; However, the fiscal space that exists in the current budget for social spending is limited, said the organization Social Management and Cooperation (Gesoc), which also noted, “there are 50 social programs with opaque performance.”

10.- Do not allow competition in infrastructure.

A few days ago, the president of the Mexican Chamber of the Construction Industry (CMIC) said that in the infrastructure sector, the President should allow free competition so that not only the Mexican Army carries out major works, such as the new Airport of Santa Lucia, but to allow competition through open tenders for the benefit of small and medium enterprises and developers who work, who have more experience.  

Source: Political Animal, El Universal, Excelsior, El Economista, Proceso, Expansión y cdnoticias.

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