Yucatán business leaders expect 1,000 firms to participate in hour-long black-out

At least 1,000 business in Yucatán are expected to turn off the electricity for an hour on November 13 in protest against the increase in electrical tariffs.

Business leader Juan Manuel Díaz Ponce told a press conference that the hour-long “mega-blackout” has been scheduled despite an announcement that tariffs would drop between 12% and 17% this month and next. The head of the state chapter of the Business Coordinating Council said some businesses have been hit with rate hikes as high as 300%.

He accused the Energy Regulatory Commission of doing nothing to resolve the issue.

Díaz and other business leaders also blamed President Peña Nieto and president-elect López Obrador for a lack of political will to find a solution.

Díaz quoted figures from the Mexican Institute of Finance Executives that showed the tariff increases have had a negative impact on local firms’ finances and investment and caused the loss of more than 7,500 jobs throughout Yucatán.

“We will not stop paying [our power bills], but we are studying other protest measures to fight the high rates,” said Díaz.

One measure will be a complaint before Profeco, the consumer protection agency. He said the collective complaint by some 1,000 businesses will be made once the documentation has been prepared, likely in two weeks.

Next Tuesday’s protest will take place between 7:00pm and 8:00pm.

The event has brought 1,000 Chinese firms to Mexico in the past eight years.

Over the past eight years the China-Mexico trade forum and show has introduced 1,000 Chinese firms to the Mexican market, according to its organizers who are preparing for another edition of the event this week in Mexico City.

The director of the Zhonghua Business Association in Mexico told the newspaper El Financiero that the goal of the forum is to forge new alliances between business people from both countries, along with expansion into the rest of Latin America.

Chinese firms specializing in furniture, appliances, power generation, illumination, consumer goods, textiles, automobiles, construction and heavy machinery have successfully ventured into the Mexican market through local alliances, said Jenny Wang.

The firms “are not looking for end customers but for strategic alliances that enable them to export to Mexico.”

According to the Bank of México, almost US $54 billion in goods were imported from China during the first eight months of the year, a year-on-year increase of 14.8%.

It was the second largest increase since 2010, when it was a whopping 43.9%.

Events such as the trade forum have brought automotive manufacturers including BAIC and JAC, tech companies like Huawei and Lenovo and transportation companies such as Mobike and Didi to Mexico.

The forum will be hosted by the Expo Santa Fe convention center in Mexico City November 6-8, and will be attended by 200 Chinese investors and entrepreneurs.

When is an airport more than airport? When it is a bellwether for a nation’s economic policy.

This week, Mexico held a referendum on the construction of a new major airport at the behest of the country’s incoming president, Andrés Manuel López Obrador.

López Obrador, known as AMLO, has long complained about the costs and environmental impact of the project, which began several years ago, even as experts and members of his own transition team warned him that voiding plans for the airport would prompt an economic disaster. It would send a message to investors, critics said, that López Obrador was hostile to the private sector, that existing public contracts might not be respected.

Still, López Obrador decided that he would go ahead with the referendum Sunday, a hasty poll that drew only 1 percent of Mexican voters. When those voters rejected plans for the new airport, López Obrador called the decision “democratic, rational and efficient.”

The market disagreed. The peso fell by more than 3 percent. The stock market fell by more than 4 percent. Analysts at JPMorgan Chase cut their 2019 forecast for Mexican growth. Juan Pablo Castañon, director of Mexico’s Business Coordinating Council, said the decision “seriously hurts Mexico’s image in the world” and “sends a message of uncertainty” to potential investors.

Because of completed construction and existing contracts, the cancellation could cost the country $5 billion. It’s unclear what will be done with the existing site — the airport’s foundation is already partially laid.

Global financial markets and the Mexican business community have struggled to predict what kind of economic policy López Obrador would pursue. The 64-year-old has been a longtime fixture on the country’s political left. He has criticized the privatization of the petroleum industry and proposed a wide range of social programs without coherently explaining how they would be funded.

 During his campaign, he spent significant time trying to convince Mexicans that he wasn’t the radical leftist that some of his opponents suggested. He recruited business leaders to join his team, including Alfonso “Poncho” Romo, slated to become his chief of staff.

“Poncho is with me to help convince the businessmen who have been told we’re like Venezuela,” he said at one campaign stop.

But even as he sailed to victory by a wide margin in the July vote, the airport hovered over López Obrador as an early, important test for how he might govern.

In 2014, President Enrique Peña Nieto announced that he would launch plans to replace Mexico City’s aging airport, the busiest in Latin America. The plan was ambitious and expensive: an $8.7 billion project in the wetland in Texcoco, north of the city, whose price tag grew to more than $13 billion. Billionaire investor Carlos Slim came on board. Award-winning British architect Norman Foster did the design. By some measures, it would be the third-largest airport in the world.

Millions, or more, had already been spent on construction by the time Sunday’s referendum was held. Still, López Obrador said he would continue with the referendum, alluding to concerns that it threatens a wilderness area with aquatic birds and could lead to flooding in the area. He suggested an alternative: adding commercial airstrips to an existing military airport north of the city.

That’s the option that voters chose Sunday, even though a fraction of Mexicans came to the polls. Aside from questions of López Obrador’s economic policy — and whether he could be counted on to respect existing contacts — the episode raised doubts about whether Mexico’s next president would attempt to govern through poorly organized referendums.

“AMLO’s use of referendums in Mexico in the name of direct democracy raises concerns over the erosion of existing democratic institutions and of policy predictability,” Fiona Mackie with the Economist Intelligence Unit said in a tweet, referring to the incoming president.

OTTAWA — Mexico’s future foreign minister says he thinks biting U.S. steel and aluminum tariffs slapped on his country and Canada could be lifted once the three continental partners sign a newly negotiated free trade agreement.

But Marcelo Ebrard, who will assume his new post Dec. 1 when the incoming Mexican government takes office, offered few details Monday on the timing of the trade pact’s ratification.

“We believe that it’s not the very best agreement, but we do need to support the advances that have been made,” Ebrard said through an interpreter at a news conference in Ottawa alongside Canadian Foreign Affairs Minister Chrystia Freeland.

“We believe that it’s worth supporting the agreement, looking to the future of all three countries.”

Canada and Mexico have responded to the American tariffs by imposing their own retaliatory levies on U.S. imports. The dispute has failed to disappear even after the three countries reached an agreement-in-principle this month on an updated North American free trade pact, also known as the USMCA.

The trilateral agreement was struck before a deadline imposed by the U.S. Congress. The aim was to get the deal fast-tracked and voted on by Dec. 1, ahead of the incoming government of president-elect Andres Manuel Lopez Obrador.

The outgoing Mexican government negotiated the deal, but officials from Lopez Obrador’s team were inside the room. Ebrard said the Mexican congress is currently looking at elements of the new deal.

Both Ebrard and Freeland were noncommittal Monday on the subject of when they expected the Trump administration to lift the U.S. tariffs on steel and aluminum, which have been in place since June.

“I think that the time when that might occur is when the agreement is signed,” Ebrard told reporters.

“What I expect, based on my communications with the current government, is that this maybe can be resolved. With the current agreement-in-principle, I believe that we will adopt a policy that will leave behind tariffs and quotas between ourselves because that goes against the free trade agreement.”

He added he hoped there would be an opportunity to get rid of them as soon as possible.

The Canadian government has insisted the steel and aluminum tariffs are a separate issue from the USMCA — but Trump has acknowledged publicly that the levies helped to expedite the new continental trade deal.

Either way, Freeland offered no timeline Monday as to when she expected the tariffs to be removed.

“I’d love them to be lifted today — there is nothing at all stopping any of us from lifting these tariffs,” Freeland said.

“We think that would be great further evidence of the importance of the North American partnership and that is what we’re communicating very directly to our U.S. partners.”

She repeated the Liberal government’s position that the tariffs, which are based on the premise Canada poses a national security risk to the U.S., are “unjustified and illegal.” Ottawa, she added, is challenging the levies at the World Trade Organization and at North American Free Trade Agreement panels.

Freeland predicted the positive momentum from the USMCA negotiations should lead to the tariff standoff’s resolution.

“It is quite reasonable to think that that positive momentum should bring Canada and the United States to simply say, ‘You know what? It’s time to lift these tariffs that we’ve imposed on each other,’ ” she said.

A Canadian source, who’s close to the ongoing talks to resolve the ongoing tariff standoff, said late last week that Washington is trying to get Ottawa to agree to a quota system in order for the U.S. to remove steel and aluminum duties.

Canada is dead set against agreeing to quotas that would limit its exports , said the source, speaking on condition of anonymity in order to discuss sensitive negotiations.

Freeland and Ebrard’s meeting was one of several in Ottawa on Monday between the Trudeau government and Lopez Obrador’s future cabinet ministers. They also sat down with International Trade Minister Jim Carr and Mexico’s incoming economy minister, Graciela Marquez.

Prime Minister Justin Trudeau met with Mexican officials later in the day.

MEXICO CITY, Oct. 20 (Xinhua) — China’s first-ever import expo, scheduled for Nov. 5-10 in Shanghai, is an opportunity for Mexican exporters and export promotion agencies to strengthen trade ties with the Asian giant, local market analysts have told Xinhua.

“We should focus not just on the sale of traditional products like apparel or food, but also try to sell different kinds of services, especially online-based services,” said Jorge Sanchez Tello, head of applied research at the Financial Studies Fund of Mexico’s Autonomous Technological Institute.

In the lead up to the China International Import Expo (CIIE), China’s embassy in Mexico has said the trade fair is designed to do more than satisfy the growing demand of Chinese consumers, Sanchez said.

It aims to spur China’s ongoing process of opening-up to the world and show its willingness to share its development gains with other countries, Sanchez added.

Mexico and China raised bilateral ties to the level of a comprehensive strategic partnership in 2013, and China has become Mexico’s second-biggest trade partner, after the United States.

Bilateral trade and investment have picked up in recent years, with Chinese and Mexican businesses successfully venturing into each other’s markets.

While Mexico has a trade deficit with China, that’s not necessarily “a bad thing,” said Sanchez, noting some Chinese imports fulfill a need for competitively priced goods in Mexico.

In addition, he said, the CIIE serves to address exactly this type of trade imbalance, by making it easier for international companies to meet and greet Chinese importers, and showcase their products.

“We shouldn’t see the deficit the way (U.S. President) Donald Trump does, as a bad thing. We take advantage of the opportunity to trade with China to bring better-priced products. And hopefully Mexican business owners will see this (trade fair) as an opportunity to diversify trade more,” said Sanchez.

Mexico has been invited as a guest of honor at the CIIE and it is organizing its representation accordingly, with federal and state officials, as well as business-sector representatives comprising a delegation heading to Shanghai.

The fair is taking place just weeks before a new administration takes over the reins in Mexico when president-elect Andres Manuel Lopez Obrador is sworn in on Dec. 1.

Lopez has noted he would strengthen ties with China, and the CIIE presents a perfect opportunity, said Mexican economist and China expert Enrique Dussel, who is a coordinator of the China-Mexico Studies Center at Mexico’s National Autonomous University (UNAM).

Dussel recommended Lopez send members of his future governing team to the fair to lay the groundwork for closer trade cooperation.

“Hopefully they will participate a month before they take office … to prepare as best they can, so as of Dec. 1 they are taking the steps needed to forge closer ties with China,” said Dussel.

About 80,000 Chinese and international companies have so far confirmed their participation in the event, which will include a trade forum attended by government leaders and representatives of international organizations.

Mexico and other Latin American countries are aware of the importance of attending the fair, said Mexican economist and twice ambassador to Beijing Eugenio Anguiano Roch.

China is a major importer, and “China’s economy demands a lot from the rest of the world,” said Roch, a research professor at the Center for Research and Teaching in Economics (CIDE), a leading Mexican think tank.

TORONTO (AP) — Canada is back in a revamped North American free trade deal with the United States and Mexico after weeks of bitter, high-pressure negotiations that brushed up against a midnight deadline.

In a joint statement, U.S. Trade Representative Robert Lighthizer and Canadian Foreign Affairs Minister Chrystia Freeland said the late Sunday agreement “will strengthen the middle class, and create good, well-paying jobs and new opportunities for the nearly half billion people who call North America home.”

The new deal, reached just before the midnight deadline imposed by the U.S., will be called the United States-Mexico-Canada Agreement, or USMCA. It replaces the 24-year-old North American Free Trade Agreement, of NAFTA, which President Donald Trump had called a job-killing disaster.

Trump on Monday morning called it a “great deal,” tweeting that it “solves the many deficiencies and mistakes in NAFTA, greatly opens markets to our Farmers and Manufacturers, reduces Trade Barriers to the U.S. and will bring all three Great Nations together in competition with the rest of the world.”

He added: “Congratulations to Mexico and Canada!”

The agreement reached Sunday gives U.S. farmers greater access to the Canadian dairy market. But it keeps a NAFTA dispute-resolution process that the U.S. wanted to jettison and offers Canada protection if Trump goes ahead with plans to impose tariffs on cars, trucks and auto parts imported into the United States.

“It’s a good day for Canada,” Prime Minister Justin Trudeau said as he left his office.

Trudeau said he would have more to say Monday.

“We celebrate a trilateral deal. The door closes on trade fragmentation in the region,” Jesus Seade, trade negotiator for Mexico’s incoming president, said via Twitter.

Representatives for the government of Mexican president-elect Andres Manuel Lopez Obrador called a press conference to discuss details of the trade deal on Monday.

The United States Trade Representative Robert Lighthizer plans to issue the text of a trade deal with just the U.S. and Mexico on Friday, two sources told CNBC, though the sources added that the release of the text could slip into the weekend. One source said that the text will allow Canada to join onto the agreement at a later date.

The Trump administration has been hurrying to meet a self-imposed Oct. 1 deadline to strike a new North American trade deal. Mexican President Enrique Pena Nieto will leave office at the end of November.

House Ways and Means Committee Chairman Rep. Kevin Brady, R-Texas, said Tuesday that he expects that to see the full text that will be sent to Congress, as opposed to an outline.

Lighthizer, in New York Tuesday, said that that the U.S. would “go ahead” with a deal with Mexico, but left open the possibility of including Canada. He noted that the administration was “sort of running out of time.”

“If Canada comes along now, that would be the best,” Lighthizer said. “If Canada comes along later, that’s what will happen.”

Lawmakers have raised concerns about a two-way trade deal, and some have said that only a three-way pact could be approved by the Senate with a simple majority.

Sen. Pat Toomey, R-Pa., said that a bilateral agreement would require 60 votes, Reuters reported in August. In order to get the trade deal fast-tracked, “the administration must also reach an agreement with Canada,” Toomey said.

Minority Leader Chuck Schumer, D-N.Y., has said that a bilateral agreement would raise “serious” legal concerns.

Business groups have also argued against moving forward with a deal that excludes Canada.

“It would be unacceptable to sideline Canada, our largest export market in the world,” the heads of the U.S. Chamber of Commerce, the Business Roundtable and the National Association of Manufacturers wrote in a letter sent to Lighthizer last week, according to The Wall Street Journal.

The biggest sticking points to reaching a deal with Canada continue to be over dairy trade rules and dispute settlement.

Canadian Prime Minister Justin Trudeau told the Council on Foreign Relations on Tuesday that his focus has been “simply not escalating. Not opining. Not weighing in.”

“My job is very simple. It’s to defend Canada’s interests, stand up for Canadians,” Trudeau said.

MTVS Motor Company will soon begin operations in Mexico and it has partnered with a company called Torino Motors which is one of the biggest in the region and is a subsidiary company of the Groupo Autofin. Torino Motors specialises in automobile and retail finance and has been active in Mexico for over 40 years now. TVS and Torino Motors plan to open 40 exclusive stores in Mexico for distribution of TVS two-wheelers. TVS is one of the leading two-wheeler manufacturers and exports to over 60 countries from India.

Commenting on this association, R Dilip, Senior Vice President – International Business, TVS Motor Company, said, “We are delighted to partner with a reputed, well-known company such as Torino Motors, who come with over 40 years of experience in Mexico. We look forward to the market knowledge that they will bring on board. Their insights will allow us to personalise our offerings to suit the customers of Mexico and their vast network of distribution will ensure maximum reach in the country. Together with Torino Motors, we are determined to create customer delight in the country.”

TVS will be offering a slew of products in Mexico starting from XL100 HD, HLX 150 along with the Stryker as well. Additionally, TVS will also launch its entire Apache range of motorcycles which includes Apache RTR 160, Apache RTR 180 and the Apache RTR 200 along with the Apache RR 310. Coming to scooters, TVS will launch the Wego along with the NTorq 125 and its step through scooters, the Rockz and the Neo.

He is beginning to explain he won’t be able to achieve everything, suggests one business leader.

Business leaders have challenged president-elect Andrés Manuel López Obrador’s claim that Mexico is bankrupt.

Speaking Sunday at a rally in Tepic, Nayarit, to launch his so-called “Thank You Tour” following his landslide victory in the July 1 election, López Obrador said the current state of the nation’s finances could limit what his government can accomplish but pledged that no campaign promises would be broken.

“We’re going to honor our commitments and we’re not going to fail the people of Mexico. Possibly due to the circumstances, because the country is going through a very difficult economic and social situation, possibly due to the bankrupt situation the country finds itself in, we won’t be able to achieve everything that is being demanded but we are going to achieve, let it be clear, everything, everything that we proposed in the campaign,” he said.

The comment contrasts with the incoming president’s statement earlier this month that there is economic stability in the country.

Responding to the president-elect’s remarks, the president of the Business Coordinating Council (CCE) accepted that Mexico has to confront a range of challenges but rejected the bankruptcy label.

“We have enormous challenges: security, efficiency of spending, [the need] to invest in connectivity, [to develop] more talent, but the government has never stopped paying its international commitments and there is the possibility of growing at 4% if the right public policy is made. There are options to believe in a promising future,” Juan Pablo Castañón said.

Addressing the same business conference, the chairman of Kimberly-Clark de México, Claudio X. González, also contested the use of the word bankrupt.

“I don’t agree with the use of this adjective, but I do agree with the fact that we have to be realistic that he will not be able to do everything . . .” González added.

“What I think he’s trying to point out is that there are very difficult situations, without a doubt, security is one of them, impunity is another, the energy situation . . . is something that he has to act on immediately . . .”

The business leader declared that López Obrador has to find a balance between “pragmatism and preaching” in order to stimulate confidence, which in turn will encourage investment.

“The balance will be crucial because we won’t be able to build the investment we need without confidence — the most important word for investment. We need pragmatism to drive investment,” González said.

Gabriela Siller, head of economic analysis at financial group Banco Base, said that government debt in Mexico currently stands at 44% of gross domestic product (GDP), which she described as high, but she added that the country isn’t bankrupt because it has the capacity to meet its financial obligations.

She interpreted López Obrador’s remark as a nod to the fact that the incoming government — which will take office on December 1 — will have limited resources to play with and will therefore need to carefully prioritize its spending.

“If he wants to do new projects, he will have to make cuts to government expenditure in some areas in order to be able to increase in others.”

“Mexico is not bankrupt . . . I’m very optimistic, if you read everything that he [López Obrador] said in this very dramatic comment, he is beginning to explain that he won’t be able to achieve everything because there is not enough money to do everything, there are not enough resources or time,” he said.