MI’s Mexico Public Affairs Chatter – Dec. 9, 2024

Trump Appoints Landau as Deputy Secretary of State

In what is regarded as a positive development, President-elect Donald Trump has chosen Christopher Landau, a lawyer and former ambassador to Mexico, as deputy secretary of state. A Harvard Law graduate and former Supreme Court clerk, Landau is known for his intelligence, good connections, and deep knowledge of Mexico, supported by flawless Spanish. Well regarded as ambassador (2019-2021), he actively promoted Mexican culture, built strong diplomatic ties, and earned respect in Mexico’s business community. While politically aligned with the intellectual right, he is seen as someone Mexicans can work with, given his understanding of the country, familiarity with key players, and solid reputation among business leaders. His expertise in migration and tariffs will be put to work in implementing Trump’s “America First” agenda, but it is hoped in as a pragmatic and non-confrontational way as possible.

 

Mexico Seizes Record Amount of Fentanyl Following Tariff Threats by Trump

Mexico seized the most significant quantity of fentanyl ever recorded, amounting to 20 million doses. President Claudia Sheinbaum announced that the drugs were confiscated north of the state of Sinaloa and attributed to the Beltrán Leyva cartel. This significant bust comes in the wake of President-elect Trump’s threat to impose tariffs on Mexican goods upon assuming office, citing “crime and drugs” entering the United States as his primary concern.

 

Omar García Harfuch, Mexico’s top security official, revealed on X that the operation, led by the Mexican Navy, resulted in the arrest of two suspects. Alongside the fentanyl, authorities seized several weapons with loaded magazines and radio communication devices. This high-profile raid follows months of escalating violence in Sinaloa, particularly since the operation to apprehend Ismael “El Mayo” Zambada, co-leader of the Sinaloa Cartel.

 

The operation’s success has elicited praise from US political figures, particularly by hardline Republicans, potentially laying the groundwork for improved bilateral relations. Congressman Dan Crenshaw described Omar García Harfuch as “the real deal,” reflecting growing trust between the incoming US administration and Sheinbaum’s government. Moreover, it sets the stage for renegotiating the USMCA agreement, scheduled to begin next year, which is an essential process for both nations’ economic stability.

 

New Regulations Complementing Judicial Reform Approved by Mexican Senate – Will They Help Ease Concerns?

On the afternoon of December 5, 2024, the Mexican Senate approved three new secondary that complement the recently enacted judicial reform: The Organic Law of the Federal Judicial Power, The Judicial Career Law, and amendments to The General Law of Administrative Responsibilities, adapted to align with the new framework.

 

The Organic Law of the Federal Judicial Power introduces two new institutions into the judicial system: the Disciplinary Court and the Judicial Administration Body.

 

The Disciplinary Court aims to monitor, evaluate, adjudicate, and sanction public servants within the judiciary. However, the court has faced significant criticism from opposition parties, who have labeled it a “Court of the Holy Inquisition.” Critics argue that it could be used to target judges who dissent from government interests. On the other hand, the government defends the court as a necessary tool to eliminate corruption and nepotism within the judiciary.

 

The Judicial Administration Body oversees administrative management within the judiciary, aiming for greater efficiency and effectiveness.

 

Additionally, this law introduces changes to the Supreme Court. The number of justices will be reduced from 11 to 9, and the maximum term of service will decrease from 15 to 12 years. Notably, the Chief Justice of the Supreme Court will now be elected through a public vote during judicial elections, with the first such election scheduled for June 1, 2025.

 

The Judicial Career Law establishes new standards for those working within the judiciary. Its key provisions include incorporating a gender perspective to promote equal opportunities for men and women in promotions, as well as measures to prevent and eradicate institutional violence.

 

In recent months, judicial reform has been a central and polarizing issue in Mexican politics. These newly approved laws come just weeks after the broader reform was passed and are intended to ease some of the ongoing controversy. The reform’s rollout was blamed for some of the increased volatility in the peso, given the uncertainty surrounding the judicial changes. By enacting these laws, the government aims to reassure financial markets and  restore investor confidence.

 

 

From Campaign Rhetoric to Governance: Can Jalisco and Chiapas Escape Their Political Past?

The new administrations in Jalisco and Chiapas present distinct opportunities and challenges for their respective incoming governors, each representing different political affiliations. In Jalisco, Pablo Lemus of Movimiento Ciudadano assumes office with ambitious promises of economic growth and enhanced security. As the leader of one of Mexico’s wealthiest and most urbanized states, Lemus faces high expectations to address critical issues like organized crime, urban sprawl, and severe mobility challenges in Guadalajara. His ability to navigate these pressing concerns while maintaining political cohesion within his party will be critical in delivering meaningful results.

 

In Chiapas, Eduardo Ramírez Aguilar of Morena begins his tenure in a state grappling with deep-seated poverty, social inequalities, and environmental vulnerabilities. Ramírez has pledged to prioritize sustainable development and indigenous rights, two pillars of Chiapas’s progress. However, his administration must contend with the state’s history of political inefficiency, ongoing social tensions, and complex relations with the federal government, led by his party.

 

 

Expanding Infonavit’s Reach:  Housing Reform

The reform to Article 123 of the Mexican Constitution was published in the Official Gazette (Diario Oficial de la Federación) on December 2, 2024. This reform allows Infonavit to expand its mandate to include housing construction and to build 500,000 homes during the current six-year term. However, adjustments to its internal regulations are still required.

 

Key Changes in the Reform:

 

  • Mandatory Employer Contributions for Worker Housing: All companies across various sectors must contribute to the National Housing Fund to provide adequate housing for their workers.
  • Infonavit’s Role in Housing: Infonavit will manage a socially oriented housing system, offering affordable credit for purchasing or improving homes, and has the authority to acquire land and build housing.

 

New Regulatory Framework:

 

  • A new law will define procedures for workers to access credit and social rental housing.
  • Social Rental Housing and Ownership Rights: Workers can access affordable rental housing, with rents capped at 30% of their salary. They will also have the option to buy these homes.
  • Priority for Long-Term Contributors: Workers who consistently contribute to the housing fund but do not own a home will be prioritized for social rental housing.

 

This reform aims to improve workers’ housing access but imposes yet more obligations on companies, both foreign and domestic, to provide adequate housing.  It remains to be seen how this will all work in practice, with concerns from housing companies that Infonavit will become another state managed white elephant, building low quality houses at high cost, while imposing yet more costs on formal employment.

 

 

Contact:

Laura Camacho

Executive Director Miranda Public Affairs

laura.camacho@miranda-partners.com

 

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