Politics: AMLO and the businessmen: hesitant pragmatism

MEXICO - Report 18 Jun 2018 by Guillermo Valdes and Esteban Manteca

Relations between Andrés Manuel López Obrador and most of the country’s business class have long been fraught. The man who increasingly seems will be the country’s next president has often had choice words for some of the country’s most powerful business leaders and has troubled them with his appeals to aspects of the economic policies Mexican governments pursued in the mid-20th century. For their part, business leaders have eyed López Obrador with mistrust, when not expressing open hostility and playing an important role in opposing his presidential campaigns, including during the current contest.

But as the odds grow of an AMLO victory on July 1, both the candidate and his detractors in leading business circles have taken a more pragmatic tack as they try to gauge to what extent they might influence and benefit from a future government, and as the candidate hopes to sustain private investment levels and a degree of financial stability, at least during the initial stages of his administration.

Just how long such an easing of tensions can endure will depend on how myriad matters play out, such as the composition of an AMLO government and whom he will nominate to key autonomous bodies, his handling of fiscal and economic policies, and what is to become of the structural reforms enacted in recent years, especially that of energy, and the major infrastructure projects already underway.

If AMLO's initial responses to these questions help reassure business owners, he may enjoy something of a honeymoon period or at least détente. But if the transition period and first months of a new government give cause for alarm or he proves too erratic in his policy decisions, many employers may feel the need for a more defensive or confrontational approach, although some sectors will likely benefit from changes to economic policy such as a major expansion of infrastructure, which could win him construction sector allies. Ultimately, disputes are likely to accumulate, although we should not expect a binary relationship, but rather differentiated degrees of conflict and collaboration.

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