July 2011

Battered Mexican leftist Party of the Democratic Revolution stumbles toward 2012 election

Dave Graham

Mexico's leftist Party of the Democratic Revolution was so sure of winning the last presidential election in 2006 that supporters took to the streets for months when it lost.

Now the party might have to join forces with the very rival it accused of stealing that election -- the ruling conservative National Action Party, or PAN -- to even compete next year.

President Felipe Calderon's party faces an uphill struggle to cling to power, tainted by a bloody war with drug gangs that he launched shortly after taking office at the end of 2006.

As the death toll in the war has risen beyond 40,000, Calderon's ratings have slumped, though his old rivals in the leftist party known as PRD have failed to take advantage.

Seen in 2006 as a force for change, the PRD has lately made more headlines for infighting, opening the door for the return to power of a once-reviled party that dominated Mexico for most of the 20th century.

Feeding off the left's weakness, the Institutional Revolutionary Party (PRI) that ruled Mexico for 71 years has regrouped and is now in a position to retake power.


Mexican independence tower is late and over budget

Officials in Mexico have said that a monument being built in Mexico City to celebrate 200 years of independence from Spanish rule is late and over budget.

The monument, the Trail of Light, is now expected to be ready in December.

The setbacks have earned it unflattering nicknames, such as 'Monument of Mexican Dependence' and "Monument of Shame".

Mexican Education Secretary Alones Lujambio, who took over the project after last year's delays, said there was evidence of inefficiency, but not corruption.


Mexico reports first measles case since '07

Latin American Herald Tribune - The first measles case since 2007 has been reported in Mexico and the patient is an 18-month-old French girl. The last case of a Mexican infected with measles was reported in 2004.


Army seizes more than 840 tons of meth chemicals

Reuters - The Mexican army has seized just under 840 tons of chemicals used for making methamphetamine in a warehouse in an industrial area in Queretaro, one of the biggest finds of its kind ever made in the country.

Audi prefers to build its own plant in Mexico

Reuters - German carmaker Audi reportedly prefers to build its own manufacturing plant in Mexico rather than use the U.S. factory of parent Volkswagen. Audi wants a new factory in Mexico to produce the sport utility vehicle Q5.


With no TV prospects, Telmex focuses on fiber

Fresh from a defeat that left it out of the Mexican TV market, Telmex will upgrade its broadband network to reach more affluent customers to counter declining revenues and call traffic from fixed phone services.

Telmex, owned by world's richest man Carlos Slim, suffered a blow in May as the government dashed for now its hopes of offering television services in Mexico, a long-coveted plan to boost the company's weakening bottom line.

The decision was one of a string of recent setbacks for Slim as regulators try to curb his power in the phone and Internet markets following years of near unrestricted growth and slack policing of the telecommunications market.


Ex-Cancun mayor released as case falters

Los Angeles Times - Yet another high-profile drug-prosecution case in Mexico careened toward collapse Wednesday when federal officials were forced to release the former mayor of Cancun, arrested 14 months ago for allegedly consorting with violent cartels.


Pemex is filling sovereign void with $1 billion bond offering in overseas markets

By Andres R. Martinez and Ben Bain

Petroleos Mexicanos, the largest oil producer in Latin America, is tapping the overseas bond market for the second time this year as a decline in government issuance fuels demand for debt sold by state-owned companies.

The yield on the company’s dollar bonds maturing in 2021 fell to 4.66 percent this week, the lowest since Nov. 12, according to data compiled by Bloomberg.

The securities yield 82 basis points more than similar-maturity Mexican government notes, down from 89 a month ago. Brazil’s state-controlled oil company Petroleo Brasileiro SA is paying a yield premium of 81 basis points, or 0.81 percentage point, above government debt maturing in 2020.

Investors seeking to buy Mexico’s higher-rated debt are turning to bonds sold by Pemex and other state-owned companies instead after the government pared offerings, said Sergio Mendez, who helps manage about 99 billion pesos ($8.5 billion) at pension fund Afore XXI.
Mexico, whose BBB rating from Standard & Poor’s is the second-lowest investment grade, plans to sell $3 billion of bonds abroad this year, down from $5.9 billion in 2010, Deputy Mexican Finance Minister Gerardo Rodriguez said last month.

Pemex, based in Mexico City, sold $1 billion more of its bonds due in 2021 to yield about 4.8 percent yesterday. The company, which is also rated BBB, issued $1.25 billion of 30- year bonds to yield 6.56 percent in May.


Stocks close sharply lower as earnings disappoint

Dow Jones - Mexican stocks suffered deep losses Wednesday on disappointing second-quarter earnings reports for local heavyweights, as more companies prepared to release their numbers. The IPC index fell 1.1 percent to 35,342 points.


Hurricane Dora moves away from Mexico

AP - Hurricane Dora is getting stronger as it moves away from Mexico, and the government there has discontinued its tropical storm watch. Forecasters say the Category 4 storms' top winds have increased to 140 mph early Thursday.