As shock waves stemming from Wal-Mart’s corruption case began to ripple across Mexico, the government on Thursday approved the nation’s first anti-corruption law.
The move appeared orchestrated to coincide with the Mexico comptroller’s office announcement 24 hours earlier that it will investigate the widening bribery case, caving into international and local anti-corruption officials and politician’s pressure that it nust get to the bottom of it.
The ordeal has sent Walmart de Mexico’s shares plummeting in recent days. On Thursday, the share closed at 28.7 pesos, down from a 52-week high of 35 pesos.
“The government is very worried and they are going to investigate this,” said Pedro Hernandez, a partner at PWC Mexico’s M&A practice.
Hernandez said it’s pivotal for Mexico to probe the case and punish its regional government officials and Walmart, if they are found guilty. Failing to do so will scare foreign investors away from the country, which is already suffering from heavy drug-related crime, he noted.
Mexico is expected to benefit from investors´ growing interest in the high-performing emerging markets as the world continues to rile under a stinging recession. According to Hernandez, the government expects to attract $19.8 billion in foreign direct investment this year, a huge jump from 2011′s $14.6 billion.
“But if something goes wrong with Walmart, if they don’t pursue this case, all of this could fall down,” Hernandez warned.
Fox News Latino - Speaking in Houston, Mexican President Felipe Calderon said Wednesday that U.S. state immigration laws, such as that of Arizona, under review by the U.S. Supreme Court, smack of xenophobia.
Reuters - Telefonica arrived from Spain framing the expansion as a social crusade as much as a business. But from a business perspective, Telefonica has spent a fortune while remaining a low-end brand, and it has run into regulatory trouble.
Associated Press — Mexican cement giant Cemex says it pared its losses to $26 million in the first quarter of 2012 compared to a $229 million loss in the same time period last year. Sales increased in the first quarter to $3.5 billion.
Dow Jones - Mexican stocks were little changed in early trading Thursday as first-quarter earnings season moved into high gear, offset by concerns about economic growth after a smaller-than-expected drop in U.S. weekly jobless claims.
Bloomberg - Sugar output in Mexico, the world’s sixth-largest producer, has fallen 9.5 percent so far this season, according to industry committee Conadesuca.
Dow Jones - Mexico's Compartamos said Wednesday its net profit expanded 12 percent on the year in the first quarter as the microfinance lender grew its loan portfolio and attracted new clients in Mexico, Guatemala and Peru.
Bloomberg - Mexico’s federal government granted Wal-Mart de Mexico 200 permits and 2,000 contracts over a period of six years, El Universal reported. In 2009, the government re-zoned “forested land” in Playa del Carmen for a Wal-Mart supermarket.
Dow Jones - Mexico likely had a trade surplus in March similar to that registered a month earlier, as high prices for crude-oil exports offset slightly lower production and automobile exports set another record.