Where Mexico is at as 2014 comes to a close

How about it?
How about it?

We are into late December here at the Mexico Business Blog Global Campus, which is either a sprawling, eco-friendly complex in central Mexico City or a fortified underground lair carved deep into the Ajusco mountain, depending on our temperament each day. Virgin of Guadalupe Day has come and gone already, which means most office workers’ minds here in Mexico are now fully focused on the customary end-of-year lunches, dinners and receptions that are taking the place of any kind of work that might otherwise have been performed or at least thought about. We, of course, are maintaining our usual stringent productivity standards but before we head out to the next punchbowl-centric holiday soiree, we thought we would comment briefly on some things that happened in Mexico over the past year.

Like every year, whether it regard the Mexican economy or our sports teams of choice, at the beginning of 2014 we thought “This is going to be our year.” And, as always, we are ending the year with no victory in hand and no small measure of disappointment. As we say here about our national football team after each international loss, “They played like never before, and lost as always.” On the economic front, you could make a case that it wasn’t as bad as it seemed. GDP growth has been on a track hovering around 2% for the year, which is nothing to go jumping naked in the pool about. But really, in this international environment? Countries like Spain, France and Japan would be jacking up interest rates if their economies caught fire like that. HSBC put some candy in our stocking by projecting 2015 GDP growth for Mexico at 3.8%. Even if HSBC is hitting the punch bowl early, at least some qualified source is upbeat for the short term.

Two areas that provide grounds for optimism going forward are auto manufacturing and the energy industry. Vehicle manufacturing of all kinds in Mexico is experiencing an unprecedented boom, with 2014 automobile production on track to blow past the 3 million units mark for a record high. This year Mexico will surpass Brazil to become Latin America’s largest vehicle producer, and with a recovering internal market and exports to Asia growing, this trend is likely to continue. The automotive manufacturing frenzy also brings with it a steady stream of foreign direct investment (FDI), coming soon to a ProMexico PowerPoint near you. As for the energy sector, government and private industry continue to augur major investment and thriving competition in oil, gas and electricity, but the process is edging forward at a rather measured pace. Earlier this month the Mexican government published the rules that will guide the initial round of exploration rights auctions in which private companies may participate, to be held in 2015. As government flacks feverishly beat tambourines and hurl confetti from rooftops to build buzz for the auctions, sourpuss pundits point out that plunging oil prices could severely undermine interest in the tenders. The overall posture as we head into the holidays seems to be “let’s just wait and see what happens,” but the Peña administration is still holding out hope that interest will be there once the auctions open.

Advanced manufacturing, energy reform and optimistic growth forecasts are all hopeful signs of continued economic development that should lead to a better tomorrow for all Mexicans. Unfortunately, however, the most important story of 2014 turned out to be the kidnapping and probable massacre of 43 students in Ayotzinapa, Guerrero. In Mexico, this story did not reveal to us that our police and politicians are hopelessly venal, corrupt and working in collusion with the organized crime groups that rule large swaths of the countryside at their pleasure. We already knew that. Domestically it was a brutal reminder of the horrors endured in these areas and the complete and utter impunity enjoyed by criminals – politicians included – in rural and urban areas alike. But the Peña administration has shown little interest in this topic. For them, the kick in the stomach was that Ayotzinapa suddenly caught the attention of the world media, which with a snap of its fingers substituted imagery of a brutal third world backwater for the stock photos of GM plants and gleaming skyscrapers that it had come to favor for stories about Mexico.

The French media took to the Ayotzinapa story with particular zeal. This is understandable, since France is still cranky about the Florence Cassez and Maude Versini affairs, although France24 ended up with its tail between its legs over its Ayotzinapa coverage to some degree, but that’s a story for another post. A little further north, The Economist and the Financial Times expressed indignation and much clucking of tongues over the affair and President Peña’s subsequent besmirchment by the appearance of conflict of interest in rigged government contracts. To this we reply: Bitch, please. Right up until Ayotzinapa these guys had been going all Pepe Le Pew over Peña and his visionary leadership, and then all of a sudden they’re playing the “I am shocked” card. Whatever, they have deadlines to meet.

In any case, the moral of the story is this: For Mexico to develop and grow and bring prosperity to Mexicans and our business partners around the world, Ayotzinapa and all it represents is more important than record auto production. It’s like trying to fly a tiny model airplane with a huge cinder block tied to the tail. If our leaders would only dedicate the time and energy they put into covering up the reality of the country into to facing up to it, getting their hands out of the cookie jar and working on grounded public policies in support of education and justice, this place would be amazing. Even more, it would send a message of hope for the future, which for so many Mexicans is just not there at the close of 2014. So how about it, Presidencia, Cámara de Diputados, Gobernadores, Presidentes Municipales? It can be your New Year’s resolution for 2015. We’re waiting.

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