Executive Summary Mexico Has Undertaken Significant Reforms Over
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Mexico's Economic Competitiveness Strategy at a Geopolitical Inflection
A NEW ADMINISTRATION CONFRONTS A CHANGING WORLD: MEXICO’S ECONOMIC COMPETITIVENESS STRATEGY AT A GEOPOLITICAL INFLECTION POINT CHRISTOPHER WILSON GOVERNANCE | MAY 2019 A NEW ADMINISTRATION CONFRONTS A CHANGING WORLD: MEXICO’S ECONOMIC COMPETITIVENESS STRATEGY AT A GEOPOLITICAL INFLECTION POINT CHRISTOPHER WILSON EXECUTIVE SUMMARY Some three decades ago, Mexico made a bet on the global economy, and at a time when populism and protectionism are on the rise, the payoff is at risk. In response, Mexico must double down on its openness while addressing the critical structural problems, including corruption and inequality, that inhibit its domestic economy and led to the sweeping electoral victory of President Andrés Manuel López Obrador (AMLO) in 2018. This essay reviews Mexico’s economic progress and the challenges ahead as a new administration takes office at a time of significant stress on regional and global economic institutions. For more than a half-century following the Mexican Revolution, the country’s foreign policy was based on the principal of noninterventionism, a not so subtle way of telling the United States and others not to meddle in Mexico’s domestic affairs. The economic equivalent was Mexico’s policy of import substitution, which raised tariffs and barriers to foreign investment designed to protect the country’s domestic industries from international competition. The two combined to make Mexico an insular country, and despite the significant economic expansion achieved in the decades following World War II, by the 1970s, Mexico’s economy and politics were showing signs of strain. In the following decade, Mexico’s relationship with the world was flipped on its head. -
Becle, S.A.B. De C.V
[Translation for informational purposes only] ANNUAL REPORT FILED IN ACCORDANCE WITH THE GENERAL PROVISIONS APPLICABLE TO ISSUERS OF SECURITIES AND TO OTHER PARTICIPANTS IN THE SECURITIES MARKET, FOR THE YEAR ENDED DECEMBER 31, 2018. BECLE, S.A.B. DE C.V. Guillermo González Camarena No.800-4, Col. Zedec Santa Fe, C.P. 01210, Mexico City, Mexico “CUERVO” Securities Representing the Capital Stock of the Issuer Characteristics Market in which they are registered Single Series Shares of Common Stock Bolsa Mexicana de Valores, S.A.B. de C.V. The securities of the issuer referred to above are registered in the National Securities Registry (Registro Nacional de Valores). Registration in the National Securities Registry (Registro Nacional de Valores) does not certify the soundness of the securities or the solvency of the issuer, or the accuracy or veracity of the information contained in the prospectus, and it does not validate the actions that, as applicable, have been performed in contravention of applicable law. [Translation for informational purposes only] TABLE OF CONTENTS 1) Overview 4 A) GLOSSARY OF TERMS AND DEFINITIONS 4 B) EXECUTIVE SUMMARY 7 C) RISK FACTORS 22 D) OTHER SECURITIES 42 E) MATERIAL CHANGES TO THE RIGHTS OF SECURITIES REGISTERED IN THE NATIONAL SECURITIES REGISTRY 43 F) PUBLIC DOCUMENTS 44 2) THE COMPANY 45 A) HISTORY AND DEVELOPMENT OF THE COMPANY 45 B) BUSINESS DESCRIPTION 49 i) Main Activity 49 ii) Distribution Channels 61 iii) Patents, licenses, brands and other agreements 63 iv) Main customers 64 v) Applicable law -
Foreign Entry and the Mexican Banking System
These Are the Good Old Days: Foreign Entry and the Mexican Banking System Stephen Haber Aldo Musacchio Working Paper 13-062 January 10, 2013 Copyright © 2013 by Stephen Haber and Aldo Musacchio Working papers are in draft form. This working paper is distributed for purposes of comment and discussion only. It may not be reproduced without permission of the copyright holder. Copies of working papers are available from the author. These Are the Good Old Days: Foreign Entry and the Mexican Banking System Stephen Haber And Aldo Musacchio** ** Haber is Peter and Helen Bing Senior Fellow of the Hoover Institution and A.A. and Jeanne Welch Milligan Professor, Department of Political Science, Stanford University. He is also a Research Economist at the National Bureau of Economic Research. Musacchio is an Associate Professor of Business, Government, and the International Economy at the Harvard Business School, and a Research Fellow at the National Bureau of Economic Research. 1 SUMMARY THESE ARE THE GOOD OLD DAYS: FOREIGN ENTRY AND THE MEXICAN BANKING SYSTEM In 1997, the Mexican government reversed long-standing policies and allowed foreign banks to purchase Mexico’s largest commercial banks and relaxed restrictions on the founding of new, foreign-owned banks. The result has been a dramatic shift in the ownership structure of Mexico’s banks. For instance, while in 1991 only one percent of bank assets in Mexico were foreign owned, today they control 74 percent of assets. In no other country in the world has the penetration of foreign banks been as rapid or as far-reaching as in Mexico. -
Cooperation Arrangement Between the Institute for the Protection of Bank Savings and the Single Resolution Board
COOPERATION ARRANGEMENT BETWEEN THE INSTITUTE FOR THE PROTECTION OF BANK SAVINGS AND THE SINGLE RESOLUTION BOARD In view of the growing globalisation of the world’s financial markets and the increase in cross- border operations and activities of financial institutions, the Institute for the Protection of Bank Savings of the United Mexican States (Instituto para la Protección al Ahorro Bancario - “IPAB”) and the Single Resolution Board (“SRB”) have reached this Cooperation Arrangement (“CA”) on the exchange of information and cooperation in connection with the Resolution planning and the implementation of such planning with respect to Entities with cross-border operations. The IPAB and the SRB express, through this CA, their willingness to cooperate with each other in the interest of fulfilling their respective statutory objectives; enhancing communication and cooperation; assisting each other in the planning and the conduct of an orderly Resolution of an Entity; and maintaining confidence and financial stability in Mexico and the European Banking Union. SECTION ONE: DEFINITIONS 1. For the purpose of this CA the following definitions apply: A. “Authority” means the IPAB or the SRB; (i) “Requested Authority” means the Authority to whom a request is made under this CA; and (ii) “Requesting Authority” means the Authority making a request under this CA. B. “Authorities” means the IPAB and the SRB; C. “Entity” or “Entities” means any credit institution, entity, body or group which is under the direct scope of responsibilities of either of the two Authorities, according to Articles 1 and 67, Section I, of the Banking Savings Protection Law (“Ley de Protección al Ahorro Bancario”) in conjunction with Article 2 of the SRM Regulation respectively; D. -
Sustainable Housing in Mexico
SUSTAINABLE HOUSING IN MEXICO 1 EXECUTIVE SUMMARY 2 I. MEXICAN HOUSING 3 II. SUSTAINABLE HOUSING: A CONCEPT ADOPTED BY THE NATIONAL HOUSING COMMISSION IN MEXICO 3 III. THE FEDERAL GOVERNMENT’S PUBLIC HOUSING POLICY 3 1. Improve public and private management on behalf of sustainable housing 4 2. Objectives of the 2008–2012 National Housing Program: a) Increase the coverage of financing for housing offered 5 to the population, particularly for low- income families 5 b) Promote sustainable housing development. 10 5 c) Consolidate the national housing system through improvements in public management 8 d) Consolidate a Federal Government support policy that helps the low-income population to obtain financing for housing and promotes sustainable housing development 6 IV. SUSTAINABLE HOUSING 7 V. CONCEPTS OF SUSTAINABLE HOUSING IN MEXICO TABLE OF CONTENTS 7 1. The Green Mortgage: A product of the Institute of the National Housing Fund for Workers (INFONAVIT) 8 a) Green Mortgage (HV) 8 b) Objectives 8 c) Benefits of the HV 8 d) Eco-technologies 9 e) Bio-climate regions and eco-technologies 10 f) E stimated savings per family 10 g) INFONAVIT 2011 11 h) Incorporation of Eco-technologies in the HV 11 i) Green Mortgage 2011 Objectives 11 j) Results 12 k) International Recognition 13 2. “This Is Your House” Subsidy 13 a) Objectives 13 b) Characteristics of the Basic Package for the Subsidy 13 c) CONAVI Requirements 14 d) Notes 14 3. Sustainable Integrated Urban Developments (Desarrollos Urbanos Integrales Sustentables, DUIS) 14 a) Background 14 b) Federal Government Encouragement 14 c) Courses of Action 15 d) Institutionalization: Inter-Secretarial Housing Commission 16 e) Integrated Sustainable Urban Developments 16 f) Types of DUIS 16 g) Sponsors of DUIS 16 h) Integration and Coordination Scheme for the Institutionalization of GPDUIS TABLE OF CONTENTS 17 i) Institutionalization at Civil Society Level: DUIS Consultative Committee 17 j) Projects – Current Status 18 4. -
First Steps of the Cabinet of Enrique Peña Nieto SPECIAL REPORT
SPECIAL REPORT Mexico: First steps of the cabinet of Enrique Peña Nieto Mexico, January 2013 BARCELONA BOGOTÁ BUENOS AIRES LIMA LISBOA MADRID MÉXICO PANAMÁ QUITO RIO J SÃO PAULO SANTIAGO STO DOMINGO MEXICO: FIRST STEPS OF THE CABINET OF ENRIQUE PEÑA NIETO 1. INTRODUCTION 1. INTRODUCTION 2. POLITICS, ECONOMY AND On 1 December 2012 Enrique Peña Nieto was sworn in as Constitutional SOCIETY: CABINET’S CENTRAL President of the United Mexican States. FORMATION 3. THE PACT FOR MEXICO Furthermore, in 2012, the elections of 128 Senators and 500 Federal 4. EXPENDITURE BUDGET Deputies were held; at the local level were elected 6 Governors of 5. CONCLUSIONS the states of Chiapas, Guanajuato, Jalisco, Morelos, Tabasco and AUTHORS Yucatan; Head of Government of the Federal District; 579 local LLORENTE & CUENCA deputies in 15 states; 876 city councils; 20 municipal boards; and 16 Heads of Delegation of Mexico City. In total, 2127 positions at national level. In this report, we intend to describe in general the key points in the government’s formation headed by the Institutional Revolutionary Party (PRI in Spanish), the party which ruled in Mexico for 71 years, lost power to the National Action Party (PAN in Spanish) during two presidential terms and is back now. Peña Nieto has affirmed on different occasions that the PRI is no longer the same one which governed Mexico; in view of this statement, it is necessary to point out that Mexico is neither the same, that society and business people are aware of and up-to-date with what is happening, since formal and informal media and the social networks help to have a better understanding of the actions of our rulers and of national and international events. -
Technical Report Documentation Page 1. Report No. FHWA/TX-10/0
Technical Report Documentation Page 1. Report No. 2. Government 3. Recipient’s Catalog No. FHWA/TX-10/0-5985-1 Accession No. 4. Title and Subtitle 5. Report Date An Evaluation of Mexican Transportation Planning, Finance, October 2009 Implementation, and Construction Processes 6. Performing Organization Code 7. Author(s) 8. Performing Organization Report No. Lisa Loftus-Otway, Nathan Hutson, Alejandra Cruz-Ross, 0-5985-1 Rachel Niven, Leigh B. Boske, Jolanda P. Prozzi 9. Performing Organization Name and Address 10. Work Unit No. (TRAIS) Center for Transportation Research 11. Contract or Grant No. The University of Texas at Austin 0-5985-1 3208 Red River, Suite 200 Austin, TX 78705-2650 12. Sponsoring Agency Name and Address 13. Type of Report and Period Covered Texas Department of Transportation Technical report, September 1, 2007 – Research and Technology Implementation Office October 30, 2009. P.O. Box 5080 14. Sponsoring Agency Code Austin, TX 78763-5080 15. Supplementary Notes Project performed in cooperation with the Texas Department of Transportation and the Federal Highway Administration. 16. Abstract This research examined the legal, financial, institutional and policy processes that Mexico uses to plan, finance, construct, and implement its transportation network. It documents through twelve case studies the state of the practice in planning, financing, conducting traffic and revenue studies, cost benefit analysis, and environmental assessments and reviews how right-of-way purchase occurs for multimodal transportation infrastructure projects. It was found that Mexico is aggressively targeting infrastructure development as a mechanism to improve countrywide network and modal connectivity and to redress social and economic inequality that had occurred because of the poor transportation network. -
Mexico Real Estate Outlook 2H18
Mexico Real Estate Outlook Second half 2018 Mexico Unit Contents 1. Summary 3 2. Market Conditions 4 2.a Building surprises with a boost to construction 4 2.b The mortgage market, due to the end of the contraction period. 13 3. Special topics 26 3.a Construction performance below its potential 26 3.b An approach to the prices faced by builders 31 3.c Population, lag and employment; their contribution to the state distribution of the mortgage market 35 4. Statistical annex 42 5. Special topics included in previous issues 46 Closing date: 10 October 2018 Mexico Real Estate Outlook – Second half 2018 2 1. Summary In our previous edition of Mexico Real Estate Outlook, we forecasted that construction GDP would fall in 2017 and not grow during 2018. The first part of our forecast was confirmed, but the rest of it was not, at least until the middle of this year, 2018. The GDP of construction closed 2017 with a fall of 1.1% in the annual rate. This is a result of the 10% decline in civil works and the slowdown in building that only improved 0.4%, both in annual terms. However, for the second quarter of 2018, the construction sector has an accumulated advance of 2%. Civil works are behaving as expected, even on negative ground, explained primarily by low investment in infrastructure works despite the announcement of the most ambitious infrastructure plan of the latest investments, which simply failed. Thus, only building remains as a driver of construction. The level of prices of construction materials has accelerated over the last few months, reaching almost 10%. -
Ben S Bernanke: Celebrating 20 Years of the Bank of Mexico's
Ben S Bernanke: Celebrating 20 years of the Bank of Mexico’s independence Remarks by Mr Ben S Bernanke, Chairman of the Board of Governors of the US Federal Reserve System, at the “Central bank independence – progress and challenges”, a conference sponsored by the Bank of Mexico, Mexico City, (via prerecorded video), 14 October 2013. * * * It is a pleasure to offer a few remarks at this conference marking the 20th anniversary of the Bank of Mexico’s independence. In August 1993, Mexico’s congress approved changes to the country’s constitution that granted policy autonomy to the Bank of Mexico and made price stability its primary mandate. Over the past two decades, these actions, along with a number of other constructive steps taken by Mexican policymakers, have paid substantial dividends in terms of improved economic performance. At the time that the Mexican congress changed the status and mandate of the central bank, the nation’s economy had been suffering periodic bouts of economic instability for many years. The 1970s through the mid-1990s in particular were marked by episodes of high inflation, boom-and-bust cycles, and financial crises. Indeed, shortly after the new Bank of Mexico law went into effect in April 1994, the Mexican economy entered the throes of the so- called peso crisis. However, the changes to the monetary policy framework, along with greater fiscal discipline and the adoption of a more flexible exchange rate, soon bore fruit. Notably, inflation fell to single-digit levels by the early 2000s. And in 2001 the Bank of Mexico formally adopted an inflation-targeting regime, which – outside of some temporary fluctuations – has succeeded in keeping inflation at around 4 percent. -
The Mexican Peso Crisis of 1995 and Its Aftermath
6 The Mexican Peso Crisis of 1995 and Its Aftermath The financial rescue of Mexico in 1995 constitutes the most extensive use ever made of the ESF to supply credit to a foreign government. The Treasury made $20 billion available to Mexico, and Mexico’s maximum drawings peaked at $11.5 billion in medium-term loans, all of which were repaid by January 1997.1 Despite a drop in income for many social groups in Mexico, the economic results suggest that the rescue was dramatically successful. The episode nonetheless raised far-reaching and vociferously debated questions about the role of the ESF in financial rescues and produced temporary constraints on the Treasury’s discretion to use the account. Origins of the Crisis In response to fundamental policy reforms under the Carlos Salinas administration, and in anticipation of the North American Free Trade Agreement (NAFTA) entering into force at the beginning of 1994, large amounts of capital flowed into the Mexican economy during the early part of the decade. Mexico received more foreign investment during this period than any of the other emerging markets. While the Mexican govern- ment had made substantial progress in implementing reforms and had greatly reduced the rate of inflation, it had also made a number of mis- 1. In addition, the Federal Reserve advanced $1 billion to Mexico, bringing total maximum drawings from the United States to $12.5 billion. 61 Institute for International Economics | http://www.iie.com takes: the banking system was weak, and monetary policy had become overexpansionary, the current account deficit too high, external debt too short-term, and official exchange-rate exposure too large. -
GAO-03-891 International Trade: Mexico's Maquiladora Decline
United States General Accounting Office GAO Report to Congressional Requesters July 2003 INTERNATIONAL TRADE Mexico’s Maquiladora Decline Affects U.S.- Mexico Border Communities and Trade; Recovery Depends in Part on Mexico’s Actions a 03-891 July 2003 INTERNATIONAL TRADE Mexico’s Maquiladora Decline Affects Highlights of GAO-03-891, a report to U.S.-Mexico Border Communities and congressional requesters Trade; Recovery Depends in Part on Mexico’s Actions Mexico’s maquiladoras have After growing rapidly during the 1990s, Mexican maquiladoras experienced a evolved into the largest component sharp decline after October 2000. By early 2002, employment in the of U.S.–Mexico trade. Maquiladoras maquiladora sector had contracted by 21 percent and production had import raw materials and contracted by about 30 percent. The decline was particularly severe for components for processing or certain industries, such as electronics, and certain Mexican cities, such as assembly by Mexican labor and Tijuana. The downturn was felt on the U.S. side of the border as well, as reexport the resulting products, primarily to the United States. Most U.S. exports through U.S.-Mexico land border ports fell and U.S. maquiladoras are U.S. owned, and employment in manufacturing and certain other trade-related sectors maquiladoras import most of their declined. components from U.S. suppliers. Maquiladoras have also been an The cyclical downturn in the U.S. economy has been a principal factor in the engine of growth for the U.S.– decrease in maquiladora production and employment since 2000. Other Mexico border. However, the factors include increased global competition, particularly from China, recent decline of maquiladora Central America, and the Caribbean; appreciation of the peso; changes in operations has raised concerns Mexico’s tax regime for maquiladoras; and the loss of certain tariff benefits about the impact on U.S. -
Mexico's Monetary Policy Communication and Money Markets
Working Paper, Nº 15/15 Mexico, May 2015 Mexico’s monetary policy communication and money markets Alicia Garcia-Herrero Eric Girardin and Arnoldo Lopez-Marmolejo 15/15 Working Paper May 2015 Mexico’s monetary policy communication and money markets Alicia Garcia-Herrero*, Eric Girardin* and Arnoldo Lopez-Marmolejo* Abstract Central bank communication is becoming a key aspect of monetary policy. How much financial markets listen and, possibly, understand Banco de Mexico’s communication on its monetary policy stance should be a key consideration for the central bank to further modernize its monetary policy toolkit. In this paper, we tackle this issue empirically by using our own index of the tone of communication based on Banco de Mexico’s speeches and statements and find that money markets do not only listen but they also understand the stance of monetary policy conveyed in the central bank’s words. Regarding the ability to listen, first, we find that both the volatility and volume in the money market rates change right after communication from Banco de Mexico’s governing body. As for the markets’ understanding, we find a statistically significant rise in money market interbank rates the more hawkish communication is. All in all, our results show strong evidence of effective oral and written communication from the Central Bank towards Mexico’s money markets. Key words: Mexico monetary policy communication; money market. JEL: E52, E58, E43. * Alica Garcia Herrero ([email protected]) is affiliated with the Research Department of Banco Bilbao Vizcaya Argentaria (BBVA) and is visiting fellow at Brussels-based think tank BRUEGEL.