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Analysis

Pact for México: a Political Roadmap for Reform

Tue, 01/22/2013 - 11:20

In March 2012, while he was still a presidential candidate, Enrique Peña Nieto signed an agreement with Mexico’s largest business chamber, the Consejo Coordinador Empresarial (CCE). This document, entitled Agenda for Mexico, engaged the presidential candidate in the promotion of a series of structural reforms geared towards the country’s economic development, namely regarding education, labor, tax collection and government spending, energy, justice and democracy.

As elected President, Peña Nieto supported former President Felipe Calderón’s labor reform initiative. His party’s votes in Congress were essential to ensure the approval of over 80% of the modifications proposed by the Executive. As a result, Mexico’s Labor Law now allows more flexible schemes for the recruitment of workers, and it includes and protects the notion of decent work proposed by the International Labor Organization, thus increasing access to the labor market and fostering productivity while also strengthening workers’ rights. The CCE congratulated both the outgoing and incoming administrations and urged Peña Nieto to continue supporting the major legal modifications proposed in the Agenda for Mexico.

Peña Nieto has shown from the beginning of his term that his government is decided on the approval of the multiple structural reforms put forward by the CCE. On the day of his inauguration, December 1st 2012, he signed a covenant with the country’s main parties: the PRI, his own party and Mexico’s biggest legislative group that also controls most of the state governments; the PAN, the right-leaning party which governed for the past two presidential terms; and the PRD, the leftist party whose presidential candidate disputed the election’s results. The PRI’s electoral ally and Mexico’s fourth biggest political force, the PVEM, added its signature a few weeks later. The agreement, called the Pact for Mexico, aims to rally support for upcoming reform. In order to ensure pluralism and broad approval for future reforms, the main objectives of the initiatives and their content will be negotiated among the four main parties by the means of a governing council.

The fact that the country’s biggest parties signed the Pact for Mexico is a reflection of their leaders’ commitment to the reforms, but it might not translate into widespread support for the initiatives issuing from the agreement. This is especially true in the case of the PRD: a considerable number of the party’s members, including its Secretary General, opposed National Party Leader Jesús Zambrano Grijalva in his decision to sign the pact. In fact, the party is planning a survey to accurately measure its members’ support for the pact. If the results of this survey turn out to be negative, they could sway the party away from the commitments signed by Zambrano Grijalva.

The Pact for Mexico has already yielded its first results. Before the end of Peña Nieto’s first month in power, Congress had already approved a constitutional reform to restructure the country’s educational system, in spite of voting divisions within the PRD’s parliamentary group. By the end of January 2013, 19 State Congresses had also approved the initiative, thus enabling the President to sign and enact the first constitutional reform of his administration. Less than two months later, on March 11, 2013, the governing council of the Pact for Mexico presented another initiative for constitutional reform, this time focused on telecommunications. It took the Chamber of Deputies only 10 days to discuss the proposed reform, agree on modifications and approve it. This time, all of the signatories of the Pact for Mexico wholly supported the initiative. Nevertheless, the reform’s discussion in the Senate proved to be more complex. Six commissions within the legislative chamber, ranging from Radio and Television to Justice, participated in the discussion and modification process. These commissions had to turn in their draft bill to the Senate in early April so it could be voted on before April 30, during the last Regular Session Period in Congress. The support of the PAN and most of the PRD, in addition to the vote of the PRI and the PVEM, ensured the approval of this reform, which will guarantee the availability of open television broadcast and facilitate the transition from analog to digital communication signals.

The President and his party have certainly found a great dialog mechanism in the Pact for Mexico, and they are confident that the remaining reforms – among which the fiscal and energy reforms seem to be the most crucial – can be fostered by the major political forces in the country thanks to this pact. The four parties represented in the agreement’s governing council support the general notion of structural reforms and now their goal is to pursue energy and fiscal reform during the next regular session period.

Peña Nieto has stated that Mexico’s economy will grow at a rate of 5% to 6% if the upcoming structural reforms are implemented. The Pact for Mexico aims to set the conditions that will test that prediction before the apparent calm surrounding the new administration vanishes. The President knows that the political sea he is successfully navigating will only get rougher as new reforms tackle over-privileged interest groups and election periods approach.