MADRID, Spain (AP) — A Spanish court ruled Thursday that a former head of Mexico’s state oil company must remain in custody while an extradition case is heard against him.

A judge ruled that Emilio Lozoya is a flight risk, according to a statement from the National Court in Madrid.

Mexico issued international arrest warrants against Lozoya last year as a result of corruption investigations. Lozoya has denied wrongdoing.

When he was arrested Wednesday in the southeastern Spanish port of Malaga, Lozoya had a driving license bearing his photograph but a different name, according to the court statement. The judge took that as an attempt to evade justice.

Spanish authorities said Lozoya had entered Spain two days earlier, but a search had been on for him throughout Europe since May.

He is one of the most high-profile detentions for alleged corruption under Mexico’s current president, President Andrés Manuel López Obrador, who has vowed to crack down on graft.

Lozoya was the director of Pemex between 2012 and 2016, during the administration of former President Enrique Peña Nieto. He had also been a key member of Peña Nieto’s presidential campaign.

Last year, López Obrador’s administration issued a number of orders for his arrest. One tied him to the bribery scandal of Brazilian construction behemoth Odebrecht and another to the sale of a fertilizer plant to Pemex at allegedly inflated prices.

The Spanish judge’s ruling referenced an “elaborate scheme” to use resources of illegal origin and participation in acts of corruption “tied to the offer of illegal contracts to his favor on the part of Pemex in exchange for a property.”

The ruling also implicated Lozoya’s sister and Alonso Ancira Elizondo, the former head Altos Hornos Mexicanos, who is still awaiting a Spanish court’s decision on his extradition to Mexico.

Lozoya and Ancira are tied by the sale of the fertilizer plant to Pemex.

Lozoya’s mother is already under house arrest in Mexico for her alleged role in her son’s schemes.

The Spanish government, citing Mexico’s Attorney General’s Office, said Lozoya allegedly defrauded the government of $280 million.

The arrest was heralded as a clear win for López Obrador, who has made eradicating corruption the central pillar of his administration.

The president said Thursday at his morning press conference that investigators “must get to the bottom” of the case to hold all those involved responsible.

“There isn’t protection for anyone,” he said. “We proposed ending corruption and that is what we are doing. We’re not going to let anything go, zero corruption, zero impunity.”

MEXICO CITY (Reuters) – Mexican bank Grupo Financiero Banorte said on Sunday it had signed an agreement with Sinosure, China’s Export and Credit Insurance Corp., which seeks to finance projects in Mexico that involve imports from the Asian giant.

Banorte did not disclose the value of the agreement in a brief statement.

Under the terms of the deal, Banorte, the bank with the biggest weight on Mexico’s benchmark S&P/BVM IPC index, will offer credit to Mexican businesses and other entities that seek to purchase Chinese goods or services.

Sinosure will in turn provide insurance and credit guarantees to Banorte to support Chinese exports to Mexico, the Mexican bank said in a statement.

China is Mexico’s second biggest trading partner, accounting for about 10% of imports and exports between the two nations, according to data from Mexico’s economy ministry.

MEXICO CITY (Reuters) – Mexican auto exports posted their first decline in a decade last year, while production in the industry registered its biggest fall over the same period, official data showed on Wednesday, the latest evidence of weakness plaguing the economy.

Auto production slipped by 4.1% to 3,750,841 units in 2019, national statistics agency INEGI said. That was the second annual decline in succession and the biggest since a drop of some 28% during the Mexican recession of 2009.

Exports fell by 3.4% to 3,333,586 units last year, the data showed, marking the first annual decline since 2009.

In December, auto output tumbled by 12.7% to 208,073 units and exports by 16.7% to 229,227 units.

Mexico exports the bulk of its manufactured goods to the United States, where industrial activity has been slowing.

Mexico’s economy has been battling to stave off recession since President Andres Manuel Lopez Obrador took power in December 2018 vowing to lift economic growth to 4% per year.

Instead, the economy suffered a mild contraction in the first six months of 2019, and economists say there is a risk Mexican gross domestic product will show its first negative annual growth in a decade when final data are published.

MEXICO CITY — Mexico raised its national minimum wage 20% Monday, but it still doesn’t amount to even $1 an hour.

The Labor Department said the lowest legal wage will be 123.22 pesos a day starting Jan. 1, or about $6.50 at current exchange rates.

That is a boost from the 120.68-peso minimum wage prevailing this year.

While the increase well above the 3% annual inflation rate, it is barely enough to keep one person over the poverty line, even though Mexico’s constitution says it should be enough to support a worker and his family.

The minimum wage in a narrow stretch of territory along the border with the United States is higher than in the rest of the country, due to higher living costs. Starting next year the border minimum will rise about 5%, to $9.75 a day.

President Andres Manuel Lopez Obrador appeared at a ceremony to announce the increase, accompanied by business leaders.

“I am aware that we still have a long way to go, because we feel behind,” López Obrador said, referring to decades in which the purchasing power of the minimum wage declined in real terms.

López Obrador acknowledged that minimum wages “cannot be decided by decree,” and he thanked business leaders for supporting the decision to raise the minimum.

The head of the Business Coordinating Council, Carlos Lomelín, called the increase “great news for Mexico.”

Mexico has been the object of criticism for keeping wages artificially low, something critics say has been used to lure auto assembly and manufacturing jobs from the United States.

But the country’s domestic economy has also suffered from a lack of internal demand because of low wages

MEXICO CITY/WASHINGTON (Reuters) – Mexican business leaders on Wednesday began poring over texts of a new stricter trade deal with the United States and Canada, looking for details of how more intrusive enforcement of labor rules in Mexico would affect their operations.

Moises Kalach, a leader of the CCE business lobby, which represented Mexico’s private sector in the negotiation of the U.S.-Mexico-Canada Agreement (USMCA) that will replace the 1994 North American Free Trade Agreement (NAFTA), said that businesses felt sidelined.

“We would have liked to have been (in the negotiations) more … to give our opinion more. This is the reality, we participated but not as much as we would have liked,” said Kalach.

USMCA was signed more than a year ago to replace NAFTA, but Democrats controlling the U.S. House of Representatives insisted on major changes to labor and environmental enforcement before bringing it to a vote.

In an unusual display of bipartisan and cross-border cooperation in the Trump era of global trade conflicts, top officials from Canada, Mexico and the United States on Tuesday signed a fresh overhaul of the quarter-century-old trade pact.

Some Mexican business groups bemoaned a lack of clarity and conflicting information on how the rules would actually be enforced under the deal, the first text of which only became public on Wednesday. An official at the truck and bus manufacturing association said he was studying the accord. CCE said it was still waiting for the documents to be translated into Spanish by lawyers.

Before seeing the fine print, Gustavo Hoyos, president of employers federation Coparmex and a vocal critic of President Andres Manuel Lopez Obrador, called the government “a bad negotiator.”

Others were more positive.

“There were many things we would have liked to have seen but in general we can say this deal is very beneficial for Mexico, it will bring investment to the country and I have no doubt will make the North American region more competitive,” said Antonio del Valle, head of the Mexican Business Council.

Mexico’s Economy Minister Graciela Marquez predicted the deal would boost Mexico’s flagging growth once it becomes law. U.S. and Canadian lawmakers signaled the deal may not reach a vote until early next year.Mexico’s peso was up more than 0.5% on Wednesday at 19.47 pesos to the dollar MXN=D2, after strengthening for five straight days ahead of the deal on reports of successful talks. The Mexican benchmark stock index .MXX rose more than 0.7%, after gaining 1.63% on Tuesday, its biggest daily rise in more than two months. Mexican 10-year bonds were steady, after rising four basis points on Tuesday, trading with a yield of 6.85%.

ENFORCEMENT MECHANISM

The deal included new bilateral mechanisms under which the United States and Canada can create panels of labor experts to investigate union complaints at Mexican factories.

Mexico’s Foreign Minister Marcelo Ebrard said that under changes to the United States-Mexico-Canada Agreement (USMCA), Mexico will be able to bring labor complaints against companies and workplaces in the United States. A Canadian source said the mechanism established with Canada was also reciprocal.”

The experts, who would include foreigners and be chosen from a list provided by each of the affected countries, will be able to penalize goods and services exported from that plant if violations of the freedom to organize or collectively bargain are detected, according to the amended agreement posted on the United States Trade Representative’s website.

Mexico’s chief negotiator Jesus Seade sought to play down the impact of such “rapid panels,” saying he had fended off U.S. union demands to place foreign labor inspectors in Mexican factories.

The rapid panels would be formed after three months and only in response to repeated complaints, Seade said.

Canada said that, under the new deal, the burden of proof has been reversed, in that failure to comply with an obligation in the chapter is now presumed to be “in a manner affecting trade or investment between the parties,” unless the defending party can demonstrate otherwise.

“If I’m reading this correctly, now the country defending itself is guilty until proven otherwise,” said a former senior Mexican USMCA negotiator.

“This can become an incentive to block trade … you just gave the U.S. an instrument to impose tariffs and close markets, because it is going to be accusing you of not complying with your labor standards.”

Duncan Wood, director of the Wilson Center’s Mexico Institute in Washington, said “that while the word ‘inspections’ has been avoided, ‘facility-based enforcement’ and in-country ‘labor attaches’ will raise the specter of foreign interference for some in Mexico.”

MEXICO CITY (Reuters) – Mexico’s government on Tuesday announced the first phase of an ambitious infrastructure plan underwritten by the private sector, covering a wide range of transportation and other public works projects over five years.

The plan compromises private-sector commitments totaling 859 billion pesos ($44.3 billion) stretched across 147 projects.

The top sectors covered by the plan are transportation, tourism and telecommunications.

The transportation projects alone, including highways, rail, ports and airports, are seen costing nearly 284 billion pesos ($14.7 billion) through 2024, or one third of the plan’s spending target, the government said.

President Andres Manuel Lopez Obrador said a second phase of infrastructure projects will be announced in January and will focus primarily on the energy sector.

“We’ve joined forces to create a mechanism that allows for the acceleration of the private sector’s infrastructure project initiatives,” said Carlos Salazar, the head of Mexico’s main business council CCE, at the event announcing the plan.

Lopez Obrador, who has sought to trim government spending during his first year as president, described the first phase of the infrastructure plan as giving a jolt to Mexico’s economy.

“We’re providing a huge push with this investment program,” he said, while congratulating assembled business leaders for their “civic and social” commitment to Mexico’s future growth.

Mexico’s richest man, Carlos Slim, whose holding company Grupo Carso is involved in the plan, said after the announcement that attractive conditions exist for private-sector driven investments.

“There are healthy public finances with a lot of discipline on the part of the public sector…and I think that gives great confidence for private investment, which is what’s available,” he said.

As growth has cooled, Lopez Obrador’s government has targeted a 1% primary budget surplus this year in an effort to project fiscal responsibility.

Activists recall job losses from NAFTA, say ‘sham’ unions in Mexico sabotage wages on both sides of the border

EL PASO, Texas (Border Report) — Despite some optimism from the White House and the business community, labor union leaders refuse to back the U.S.-Mexico-Canada Agreement.

The USMCA would replace the existing North American Free Trade Agreement, which predates e-commerce and has been criticized for shortcomings in environmental and labor protections.

“The new NAFTA is not a policy we support at this time,” said Liz Shuler, secretary-treasurer of the AFL-CIO, during a visit to El Paso last week. “The lack of enforcement, the lack of resources committed by the country of Mexico are not adequate. … As we stand now, NAFTA 2.0 does not have the assurances we need for fair trade policies that work for the working people.”

Earlier, AFL-CIO President Richard Trumka had been more blunt, saying Mexico maintains cheap wages by using “sham” labor unions that sign off on whatever deal a corporation brings to the table.

“If Mexico cannot enforce its own laws, then this agreement will never work because their wages will be artificially low. They will suck jobs and capital out of the United States,” Trumka told Bloomberg last month. His comments came after President Trump boasted that the USMCA “has become very popular, unions are liking it, farmers are loving it and manufacturers are really liking it.”

The new trade deal will create 167,000 new jobs and incorporates core labor protections, according to the White House. Border labor activists said that’s a song they’ve heard before and don’t believe.

“When NAFTA passed we lost 35,000 jobs in the garment industry. A majority of the workers in that industry were women who were making $13 an hour, buying homes on the Eastside and sending their kids to college. Those are the jobs we lost that never came back,” said Lorena Andrade, executive director of La Mujer Obrera, an El Paso, Texas nonprofit for displaced workers.

Andrade, who keeps in touch with independent union organizers and environmentalists in Mexico, said the new trade agreement will further erode wage potential on both sides of the border and foster a more rapid consumption of natural resources in Mexico.

“Their idea of progress is not good for our communities,” she said. The factories “can just pick up and leave when they want. Women workers are disposable on both sides of the border; our communities are disposable.”

Ildefonso Magana, a representative of the International Union of Painters and Allied Trades in Laveen, Arizona, said the Trump administration is eager to sign a trade agreement with Mexico but turns its back on any talk regarding immigration reform.

“There is a moral double-standard that allows the free flow of trade, merchandise and wealth but prohibits the free transit of those who produce the wealth, of the workers,” he said at a labor union meeting in El Paso last week.

Mexico dropped six places to 60th in the latest edition of a World Bank report that measures the ease of doing business in 190 countries.

The Doing Business report awards each country a score out of 10 in 10 different areas: starting a business; dealing with construction permits; getting electricity; registering property; getting credit; protecting minority investors; paying taxes; trading across borders; enforcing contracts; and resolving insolvency.

Mexico’s score of 72.4 is slightly better than the 72.09 it obtained last year but couldn’t prevent the country from taking a tumble in the rankings.

Mexico’s ranking only improved in one area – protecting minority investors (up to 61st from 72nd) – and held steady in two others: enforcing contracts (43rd) and dealing with construction permits (93rd).

The country’s ranking went backwards in the other seven areas. It is no longer among the top 10 countries in any of the areas, dropping three places in “getting credit” to 11th.

Mexico has fallen 15 places in the Doing Business rankings since 2016 and this year lost the top spot in Latin America to Chile, which ranked 59th.

Speaking at his regular news conference on Thursday, President López Obrador was incredulous that Chile – where protests have virtually paralyzed the country in recent days – has surpassed Mexico as the easiest place to do business in Latin America.

“Yesterday, something to do with the World Bank came out about Mexico’s [business] rating and, listen to this, Mexico supposedly occupied first place [in Latin America] for foreign investment confidence but now we’ve fallen to second place,” he said.

“And who do you think now occupies first place?” the president, with a wry grin on his face, asked reporters. “Chile, so they’re not infallible.”

New Zealand took out the top spot in this year’s Doing Business rankings with a score of 86.8. Singapore was second followed by Hong Kong, Denmark, South Korea, the United States, Georgia, the United Kingdom, Norway and Sweden.

Somalia is the hardest country in which to do business, followed by Eritrea, Venezuela, Yemen and Libya.

SAO PAULO (Reuters) – Brazil and Mexico have begun talks on a free trade deal, officials said on Monday, seeking to deepen commercial ties between the two largest economies in Latin America as trade tensions threaten to undermine global growth.

Marcos Troyjo, Brazil’s deputy economy minister for foreign trade, said Brazil had formally started free trade talks with Mexico, which in June ratified a trade pact with the United States and Canada to replace the North American Free Trade Agreement (NAFTA).

Troyjo said that Mexico had traditionally focused on trading with its NAFTA partners but wanted to diversify. He believed Brazil would be able to export more agricultural products to Mexico, Latin America’s No. 2 economy.

Mexico’s economy ministry confirmed there had been talks.

“We have had conversations to see how we can advance toward a liberalization, but we still haven’t defined the path to take,” the ministry said in a statement. “But we’re working on it.”

Trade between Brazil and Mexico has been less than desired, Troyjo said at a conference hosted by the Brazil-China Business Council in Sao Paulo.

The U.S.-Mexico-Canada Agreement has changed things, he said, and “Brazil has a more immediate interest in increasing its exports of agricultural commodities to Mexico.”

Lawmakers in the United States and Canada have yet to ratify the agreement.

The talks between Brazil and Mexico represent the latest chapter in Brazil’s efforts to open up its hidebound economy and trade more with the rest of the world.

Under far-right President Jair Bolsonaro, Brazil has begun talks on a trade treaty with the United States and is hoping a hard-won pact between the European Union and the Mercosur bloc of South American countries will be ratified.

However, Brazil’s efforts to broaden commercial ties coincide with a trade war between the United States and China that has ignited fears of recession globally.

In July, U.S. President Donald Trump said he would pursue a trade agreement with Brazil, suggesting a friendly relationship with Bolsonaro could help lower trade barriers between the two countries.