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OP-EDS

Reading Between the Lines

7/30/2018

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By Veronica Ortiz O.
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With elections in our country officially over, the delegations of Mexico and the United States resumed NAFTA renegotiation talks yesterday.

The resounding triumph of Andrés Manuel López Obrador and the smooth political transition that President Peña Nieto’s administration has allowed, gave new vigor to the negotiating team, now accompanied by the future Ministers of Foreign Affairs, Marcelo Ebrard; Economy, Graciela Márquez; and future leader of the renegotiation team, Jesús Seade.

The high-level U.S. and Canadian governments visits to the President-Elect contributed to easing concerns about a possible change in the Mexican position.

However, the most relevant note regarding the new bilateral relationship was the unusual exchange of letters between López Obrador and Donald Trump.

The extensive letter sent by AMLO to President Trump proposes a new understanding between the two countries. In seven pages, he alludes to dignified and respectful treatment dozens of times.

López Obrador centers the bilateral cooperation for development on four strategic areas: trade, migration, development, and security. The generation of employment and welfare in Mexico and Central America will reduce forced migration and facilitate migration control.

However, it is the last paragraph that provokes astonishment due to the personal message from Mexico’s next President to his American counterpart.

For starters, López Obrador points out the unbreakable ties between both countries, such as language (sic), culture (sic), traditions (sic), a "long relationship and much solidarity." And then, an eloquent closing where López Obrador points out the similarities that bind him to Trump: fulfilling their promises, successfully facing adversity, placing voters at the center, and displacing the establishment or the ruling regime.

Curious, to say the least, that it is López Obrador himself who affirms his affinity with Donald Trump when throughout the campaign he denied and disqualified those who mentioned any similarity between the two.

Aside from understanding exactly what adversity Mr. Trump faced during his campaign, it is even more amazing that AMLO exalts the way, in his view, both came to power: putting citizens first and defeating the system, when neither of them ended a dictatorship or an undemocratic regime. Yes, they triumphed over the ruling parties, flagged by other opposition parties. In any case, Trump would qualify as an outsider or external to the political class, but not AMLO, who is the net product of the patriarchy.

Where they are similar is in the binary way of conceiving the world, in black and white, between allies or enemies, loyal or fake press, wise people or suspicious civil society.

Unfortunately, they both share a self-centered vision that will be difficult to overcome.

The views expressed here are solely those of the author.
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Election Gives Trump a Chance to Hit the Reset Button With Mexico

7/11/2018

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​By Earl Anthony Wayne
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Secretary of State Mike Pompeo is slated to visit Mexico Thursday to follow up the positive initial phone call between Mexico’s president-elect, Andres Manuel Lopez Obrador (AMLO), and President Trump the day after AMLO and his allies swept to an impressive victory in Mexico’s July 1 elections. 

White House advisor Jared Kushner, Treasury Secretary Steve Mnuchin and Homeland Security Secretary Kirstjen Nielsen will also reportedly now join Secretary Pompeo in Mexico City.

AMLO announced he would invite President Trump to his inauguration and has named a future foreign secretary, Marcelo Ebrard, with more U.S. experience than he has.

AMLO also reportedly designated an experienced Mexican diplomat as future ambassador to the U.S. and well-regarded lead trade negotiator to join Mexico’s North American Free Trade Agreement (NAFTA) team. 

These developments highlight the significance of U.S.-Mexico relations for both countries. Both seem to recognize that Mexico’s election and political transition provide an opportunity to reset U.S.-Mexico relations, as Lopez Obrador prepares for his six-year presidential term beginning Dec. 1.

To succeed, both parties need to regularize respectful ways to work through divisive issues and carve out common ground. 

Read the full article on The Hill...
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An AMLO Presidency and the Future of Mexican-U.S. Migration Policy

7/8/2018

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​By Rachel Schmidtke
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As Mexico begins the process of transition to a new administration, there is considerable doubt about the true nature of the new president, Andres Manual Lopez Obrador, or AMLO as he is commonly known.

AMLO won Sunday’s election with an extraordinary 53 percent of the vote, giving him a clear mandate. Throughout his career, he has taken strong stances on topics like corruption, on what he calls “the mafia in power,” and on poverty and inequality. As a result, he is a figure that inspires hope or fear, dividing Mexicans neatly down the middle.

In the United States, AMLO has drawn a similar reaction, with many worrying about the future of the bilateral relationship. Of particular concern is the future of cooperation on migration. It is a topic that will likely lead to some tensions between the Trump administration and the new government, who will likely re-evaluate its alignment with the United States on topics regarding Central American migration and Mexican emigration to the United States.

Given the controversial nature of the issue and its importance for President Trump, the future of the Mexico and U.S. relationship might just depend on how willing each leader is to work on migration.

Read the full article on Inside Sources...
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Mexican Elections: A change in the party system?

7/6/2018

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By Miguel Garza
Last Sunday’s general elections in Mexico were historical for many reasons. First, MORENA with its founder-candidate, Andres Manuel López Obrador (AMLO), won the Presidential election, giving Mexico its first left-leaning government in democratic history. Second, the thirty percentage points that AMLO had over the second place candidate (Ricardo Anaya) is the largest victory margin since the 1982 Presidential election where Miguel de la Madrid won by 55 points. Third, this election could be the first step towards a new party system where the once all-mighty PRI loses relevance, PAN is deeply fractured, PRD loses its left-wing monopoly, and MORENA is the primary political force in Congress.

This election will be remembered as the one where the PRI lost what was left of that all-mighty party. With the PREP officially closed, the PRI won around 16% of votes for President and 16% of the Senate and lower House. Adding to this overwhelming defeat at the federal level is its poor performance at the local level. Of the nine states where the governor position was up for grabs, the PRI did not win any of them and will be in third place or worse in all (getting no more than 20% of votes in each of them) except Yucatán, where they will finish second. With the final PREP data, the PRI did not win a state, only won one electoral district, and 8.9% of municipios in the country. 

With this historic defeat at the federal and state level, after 90 years as Mexico’s dominant party, will the PRI be able to bounce back and recapture their all-mighty position? An insight into this topic was provided by Joy Langston during the “Mexico Election 2018: A Historic Vote Across the Nation” at the Wilson Center: Without support from state and local level victories, it will be hard for the PRI to build a winning campaign for the next electoral process. The way the PRI lost the election this past Sunday limits the party’s access to state and local support (they now govern fewer and smaller states than in 2000), and they will not be able to move their political agenda in Congress alone. With these results, the PRI is starting an uphill path towards redemption. It will be interesting to see how the party restructures their ideals and strategies to compensate for their poor performance.

The other big loser of Sunday’s elections is the PAN-PRD coalition, the “Frente.” The non-ideological coalition between these two parties raised more concerns than answers for the Mexican voter. Despite positioning themselves as the secondary political force after receiving 22% of the Presidential vote, both parties are left with deep structural problems. PAN and PRD together could not get more votes than the 2012 third place PAN (Josefina Vazquez Mota had almost 26%). When looking at other races, the picture does not get better for PAN, and it is very troubling for PRD. PAN will get around 18% for the Senate and the lower House while PRD has only 5% in the Senate and the lower House. With this result, the PRD not only loses the left-wing leadership but also steps down to the national fourth place, losing its place as one of Mexico’s most important parties. In state elections, the results look a little better; the coalition was able to achieve some key victories in Guanajuato and Puebla, and PAN was also able to win Yucatán without the coalition. 

The PAN-PRD coalition is typical for Mexican politics, but is not an alliance typically seen in the rest of the world, as it has a right-wing party join forces with a left-wing party. This coalition is one made of convenience – as an anti-incumbent strategy – rather than one of similar ideologies. In my own research, I explore the consequences on voters’ behavior of two such ideologically different parties coming together. First, voters like to have easy access to information and ideology is one of the most important cues. With two non-contiguous parties coming together, voters are unable to disentangle the coalition position in the spectrum easily. Second, voter behavior in Mexico tends to be economic or clientelistic; they look for rents or benefits that parties can assign them. The coalition sits in a suboptimal position where resources have to be assigned to very different policy options and voters don’t see a direct way of benefiting from them. Third, the anti-incumbent strategy used by the coalition at the state-level elections was the wrong one at the federal level, given the opponent. Similar coalitions in the past have targeted the PRI as the incumbent force, and this coalition strategy was no different, but the political landscape had dramatically changed this time. AMLO is not only a non-incumbent, but a better known anti-incumbency force than the PAN-PRD coalition. 

The great winner from this electoral process is undoubtedly MORENA. They not only won the presidency, but they did so in a dominant way, winning 53% of the vote. This landslide victory is complemented with an almost certain majority in Congress. With data from the PREP, they have 37% of the Senate and the lower House. These numbers will increase with their allies guaranteeing a majority in Congress. As if such success at the federal level was not enough, MORENA and their coalition partners have been able to win 5 of the 9 governor elections throughout the country (including Mexico City). 

After the dominant victory, everything seems to be going MORENA’s way, but it is relevant to ask if this success can be sustained or if this party will deflate once the leader, Lopez Obrador, steps away from the political scene. MORENA is a party that was created by AMLO in order to postulate himself as a presidential candidate once PRD moved away from him. As mentioned by Eric Magar at the Wilson Center, MORENA candidates at the local and state level relied heavily on AMLO’s figure. With this mechanism, the party has been able to expand the success to other instances where the leader was not directly involved. But, can MORENA rely on this strategy forever? The next six years will be key for the survival of this party. Either AMLO’s presidency will be a success or the support they got from “independent” voters this year will switch to whatever option seems better when the next election comes around. If MORENA is not capable of maintaining and expanding their base, their incumbency and relevance as a political actor will end soon after. 

MORENA’s victory on Sunday is not only changing Mexico’s government but is also changing the Mexican party system. On the right side of the spectrum, we have a very fragmented PAN that has been divided in half because of their coalition with the PRD and the imposition of Ricardo Anaya as the presidential candidate. The once strong opposition party has a lot of work to do to recover those voters who decided to support someone else. PAN must return to the values under which it was created to appeal to its base and be a strong contender again. The PRI needs a complete restructuring of policies and values. The once long-standing incumbent now has to fight the opposition and without much local or state level support. It will be interesting to see how PRI evolves into a new party, if they do at all. Moving to the left, we might have seen the last election with the PRD as a relevant party. The massive defeat they suffered might be the last blow they needed before disappearing. The coalition with PAN prevented them from stealing votes from MORENA and took them far from the left side of the spectrum. Last but clearly not least, MORENA is now the left-wing champion. It took most of PRD’s votes and bastions and was able to position itself as the only strong left-wing option, at least for the next six years. It is still to be seen if they can hold the position for more than one or two electoral cycles, particularly without the personal force of AMLO. 

Miguel Garza is a research assistant for the Wilson Center's Mexico Institute and a PhD candidate at The Ohio State University.
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Why Mexico's New President is Playing Nice with Trump

7/3/2018

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By Duncan Wood
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It would be easy to assume that Mexico’s new president is going to tear down his country’s relationship with the United States. After all, Andres Manuel Lopez Obrador—who was elected Sunday with a stunning 53 percent of the vote—has called President Donald Trump “erratic and arrogant” and has even published a book titled “Listen up, Trump!” in which he rejects the U.S. president’s attacks on Mexico and his repeated calls for a border wall.

AMLO is an unapologetic leftist, and his Morena party, which he founded in 2013 and has built through sheer force of will, dominates the new Congress (although early numbers suggest his coalition may not quite get a majority in the Chamber of Deputies). The party also won five out of nine governorships that were put up for grabs in Sunday’s election. AMLO and his party therefore appear to have an almost obstacle-free path for a radical agenda of change.

And yet there is still a great deal of confusion and doubt about what this means for Mexico and for its relations with the U.S. What is likely is that AMLO will be much less radical than many fear, and that he will pursue stability in place of revolution. For foreign relations, he has already indicated that he is willing to work with Trump and recognizes the importance of NAFTA to Mexican prosperity.

Read the full article on Politico.com...
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AMLO and the Markets: Who Will Tame Whom?

7/3/2018

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​By Christopher Wilson
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The relationship between President-elect Andrés Manuel López Obrador, or AMLO, and the business community has long been a tense one. Many of the leaders of Mexico’s largest businesses sounded the alarm, endorsing alternate candidates and warning of the dire consequences of an AMLO presidency for the Mexican economy. Yet in the run up to and then in the immediate wake of the elections as his victory became inevitable, the value of the peso strengthened and Mexican stocks rallied. After months of Mexico skepticism based on NAFTA and political risk, have the markets had a change of heart and become AMLOvers, as his enthusiastic supporters are known?

Yes and no. He has been effective, at least for now, in signaling to investors foreign and domestic that many of their worst fears are overblown. In the face of NAFTA uncertainty, he has changed from critic to supporter, going so far as naming a chief negotiator and potential trade minister that are committed to working with the current Mexican team in an attempt to finish negotiations even before López Obrador takes office on December 1. His team has voiced support for virtually all the positions of the current Mexican negotiators, only breaking with them on the issue of enshrining salary increases for Mexican workers in the trade agreement, which the Peña Nieto government has rejected.

AMLO’s likely finance minister, Carlos Urzúa, held a conference call with investors on Monday to assure them the incoming administration would respect the autonomy of the central bank and maintain fiscal discipline, echoing statements made by the President-elect himself in his victory speeches on the night of the election. His energy advisors have similarly sought to calm the nerves of oil and gas companies, which have begun making big investments in Mexico since the passage of its 2013 constitutional reform allowing foreign and domestic private participation in exploration and production. AMLO’s economic advisors have promised to respect already issued contracts if no evidence of corruption in their issuance is uncovered. More generally, AMLO has promised to respect the rule of law as he implements his reform agenda.

What all these statements have earned AMLO is a window of opportunity. Currency traders holding short positions on the peso in anticipation of a post-election depreciation began to dump their shorts, realizing that a fair amount of AMLO-uncertainty had already been priced into the value of the peso and in expectation that the President-elect would be making more market friendly signals in the coming weeks. The reprieve, though, is just that. Investors’ antennas are raised, poised to sell if AMLO begins to appear more like an aspiring autocrat or radical economic nationalist than a common-sense reformer. That would raise borrowing costs for his government and threaten economic growth.

No one has forgotten his promises to cancel Mexico City’s new airport, a mega-project already underway, with contracts signed and debt issued. Nor have they ignored the seeming contradictions between his support for free trade and his call for Mexico to grow all its own food. International analysts will be reading the tea leaves, asking whether AMLO will use his anti-corruption mandate to bury political opponents or to strengthen institutions. They will watch as his economic team begins working on next year’s budget for signals as to whether he will swell Mexico’s debt to pay for his promised increases in infrastructure and social spending. Will he follow through with plans to build oil refineries to avoid selling crude and importing gasoline and to freeze new oil exploration auctions, or will he instead reform PEMEX, the state-owned oil company, and invest in much more lucrative energy production projects, something the private sector has shown willingness to help finance?

AMLO has promised a peaceful revolution as significant as Mexican independence in 1810, its period of liberal reforms in the 1860s and the revolution in the early twentieth century. He aspires to greatness, to leave a legacy as a transformative figure that finally brings and end to corruption and inequality. For decades now, he has railed against the failures of neoliberal economics and what he sees as an oligarchic system designed to keep people like him out of power. Along the way, López Obrador has shown a distrust in institutions and and modern economic principles.

Ironically, he will need effective institutions to fulfill his central campaign promise of combating corruption and a well-functioning economy to generate the tax revenue needed to fund his proposed infrastructure and social spending designed to bring economic opportunity to those who have been left behind. Even if he does not like business elites and New York investors, he needs them to achieve his goals. To tame markets, AMLO must listen to them.

Christopher Wilson is Deputy Director of the Wilson Center’s Mexico Institute and author of the report Growing Together: Economic Ties between the United States and Mexico.

This article was originally published on the Mexico Institute's blog on Forbes.com.
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  • Home
  • About
  • To Get You Started
    • The Parties
    • Electoral Map
    • AMLO's Cabinet Members
  • 2018 Election Process
    • The Candidates
    • Policy Proposals >
      • Security and Rule of Law
      • Anti-Corruption Efforts
      • Mexico In The World
      • Economic Development
      • Education
      • Health
      • Energy and Environment
      • Agriculture, Farming, and Fishing
      • Poverty Alleviation
  • The Expert Take
    • Op-Eds
    • Podcasts
    • Videos
    • Publications
  • Transition Recap
  • In The News
  • Post-Election Analysis
  • Contact