The Mexican Paradox

Guest: Jorge Guajardo, political advisor and former Mexican Ambassador to China

Mexico is a country riddled with contradictions – from President Lopez Obrador’s leadership to the country’s economy, and even to tourism. How should we look at all these contradictions?

It’s confusing. For one, President Andrés Manuel Lopez Obrador – or AMLO, as he is called – declared a rhetorical war on the private sector at the beginning of his administration.  Yet, contrary to experts’ forecasts, the economy is holding on pretty well – at least for now. On the tourism front, it’s still one of the world’s booming tourist destinations, notwithstanding travel advisories, warnings of drug gang-related violence and crime sprees in tourist destinations.  And on trade, the government is protectionist while negotiating and ratifying a new North American trade agreement. Our guest, Jorge Guajardo, former Mexican Ambassador to China who has worked in the public and private sector of Mexico, joins us to make sense of all these contradictions.

We started by asking Jorge about AMLO himself. He’s incredibly popular in the polls yet many people have grave doubts about many aspects of his policies, particularly the recent electoral reforms undermining the electoral agency’s ability to oversee illegal election expenditures.  Why is he so popular? Guajardo said, “The first thing I tell people when I try to explain Mexican President Lopez Obrador is to think of Donald Trump. They’re identical political creatures. They’re very good at waiting for the wins, they’re very good at knowing what is popular and what is not. They care about power more than about good government, and they ride the popularity wave towards achieving their goal of power, and they do it well.”

We asked Guajardo about President AMLO’s openly anti-business posture. Guajardo said, “His rhetoric is anti-business. His actions are not. He has not increased the tax base for the business community. He has not increased regulation. He has ensured that free trade continues. So, in that sense, his rhetoric tends to be much more anti-business than his actions are. And I think the business community has taken the measure of that, and they’re proceeding accordingly.”

What about the energy sector, an important economic driver for petroleum-exporting Mexico? AMLO has been particularly hostile against renewables. Guajardo responded, “What I would advise private sector companies now is to position themselves to start seeking areas of opportunity — partnerships, supply chains – which is not an easy thing. The supply chain for renewable energies, particularly solar panels, has been a problem. The same applies to windmills. So, I would say the opportunity right now is to start positioning themselves and wait for October 1st, 2024 when there will be a new administration.”

Then – the crystal ball portion of the podcast. Is Guajardo optimistic or pessimistic about the next 5 years for Mexico? Guajardo responded, “I am optimistic after the next 18 months. I am very pessimistic for the next 18 months for the simple reason that – I’m going to end as I started, comparing President Lopez Obrador with President Trump. We know that as they start losing power, they have this instinct to burn down the country. That is my concern.”

How will AMLO spend his last year in office? Find out more by listening to the latest Altamar episode, available wherever you get your podcasts. You can download the episode here.