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Tuesday, Dec. 31, 2013

Enrique Peña Nieto is person of the year

Education, fiscal, energy and political reforms passed; Mexico finally will have re-election and more political accountability; energy reform could have a lasting, long-term positive impact on the economy

      epnPresident Enrique Peña Nieto, who got four major reforms passed this year despite lacking a congressional majority, is MexicoPerspective's Person of the Year.

      Peña Nieto and his team were able to get the Mexican Congress to pass education reform, fiscal reform, energy reform, and political reform. All this is not to mention telecommunications and labor reform. The political reform, which will allow consecutive re-election of legislators and local officials, may have had more to do with getting the National Action Party (PAN) to pass the energy reform.

     The now-dead Pacto por Mexico, an agreement among Peña Nieto's Institutional Revolutionary Party (PRI), the PAN and the Democratic Revolution Party (PRD), had a lot to do with the progress made this year. The PAN wound up angered by the fiscal reform's raising of the value- added tax along the border from 11% to the national level of 16%, but the PRI was able to get it passed with the help of the PRD. Then, the PRI and PAN combined to vote in the energy and political reforms. The political reforms should provide more accountability. The energy reforms, over time, could have a positive, long-term impact on the economy.

     Bloomberg News Service today in an article titled "Mexico's Amazing Year" lauded Peña Nieto's reforms, and said that while they should provide long-term growth, lamented that Mexico's economic growth this year will only be 1.2%. It said Mexico needs to do much more to bring vastly more workers into the formal employment sector, collect more taxes, and strengthen rule of law to get the economy to work much more efficiently.

      Many analysts have lamented that the reforms did not go far enough. And in the past, reforms that have passed have not been well implemented. Also, the PRI itself blocked similar reforms during PAN administrations. Still, if Peña Nieto's government can now deliver on carrying out the reforms, Mexico may really be going places.

Americas Society / Council of the Americas reforms explainer

El Mexicano: "Transformations" editorial of Dec. 31 says reforms, which some thought to be impossible at beginning of year, have great potential.

Update, Jan. 3: Frontera columnist Benedicto Ruiz says that while 2014 could wind up being the year of transformation promulgated by the PRI, it instead or also may be "a crucial and complicated year, in economics as well as in the social and political arenas." His column (PDF).
The Mexico Institute's Duncan Wood notes that perhaps due to slow economic growth and continuing violence, Peña Nieto's approval rating is only 44%, and says 2014 may be a pivotal year. His piece, CNN.