Mexico’s electoral body, the National Electoral Institute, announced preliminary results and a quick count of the 2024 elections on June 3, 2024.
According to the preliminary results, the National Regeneration Movement (Morena) candidate Claudia Sheinbaum won more than 58% of the votes, while the opposition candidates Xochitl Galvez Ruiz won between 26.6 and 28.6% of the votes, and Jorge Alvarez Maynes between 9.9%. -10.8% of the votes.
Sheinbaum will now become the country’s first female president and will begin her presidency on October 1, 2024.
Sheinbaum, a left-wing former mayor of Mexico City, had campaigned on continuing the political course set over the past six years by her political mentor and outgoing leader Andres Manuel Lopez Obrador (AMLO), whose popularity among the poor led to Sheinbauz’s victory in the recent elections.
In addition to the presidency, more than 20,000 posts were contested at federal, state and municipal levels in Mexico’s largest-ever election.
Morena and his allies are likely to win a two-thirds supermajority in both houses of the Mexican Congress (the Senate and the Chamber of Deputies), allowing the coalition to push through constitutional reforms without the support of the opposition.
According to initial results, the Morena coalition will win at least 346 seats in the 500-seat lower house and between 76 and 88 seats in the 128-member Senate, where 85 seats are needed for a supermajority.
Markets reacted negatively to Sheinbaum’s landslide victory, with both the stock market and the value of the Mexican peso falling on fears that a supermajority in the country’s Congress could lead to constitutional changes, reducing existing checks and balances .
Mexico’s benchmark index fell 6.1% on June 3, 2024, while the peso hit a seven-week low of 17.75 against the US dollar on the same day (signaling a decline of 4.29%), according to data of the London Stock Exchange Group; it ended the session down 3.8% at 17.67 per US dollar, marking its weakest daily close since November 2023.
The decline in stock prices and the value of the peso is due to growing concerns that the Morena Party will have a clear path to implement controversial constitutional reforms, which AMLO sought; These reforms include several issues in areas such as pensions and the energy sector, along with controversial judicial and institutional reforms that are likely to weaken the separation of powers and result in the disappearance of a number of independent regulatory bodies.
Claudia Sheinbaum, a climate scientist and PhD (Doctor of Philosophy) in energy engineering, is committed to sustainable development and poised to transform the country’s energy landscape during her term.
Sheinbaum’s roadmap for 2024-2030 reports that her government will align with former President AMLO’s energy policy, which is based on energy self-sufficiency through the strengthening of the state oil company Petróleos Mexicanos (Pemex), and the recovery and takeover of refineries.
Sheinbaum unveiled a plan in April 2024 to invest more than 225.9 billion pesos ($13 billion) in new energy generation projects through 2030.
This investment will be made in increasing wind and solar energy generation and modernizing five hydroelectric power stations in the country.
Sheinbaum had campaigned on a promise to continue former President AMLO’s pro-labor policies, pledging to preserve democracy, respect business freedom and facilitate private investment.
However, when she takes office in October 2024, she will face major challenges, such as high homicide rates, tackling a budget deficit and spending on social programs.
A major challenge for the new government will be the management of state-owned energy company Pemex, the world’s most indebted oil company.
If Pemex’s debt is not restructured, it will likely downgrade the investment-grade rating of Mexico’s sovereign debt as the state will have to bail out the company.
While Sheinbaum has pledged to support Pemex and oppose any attempt to privatize its assets, she has not provided details.
Sheinbaum’s election also presents a mixed picture for the construction sector: her promise to continue AMLO’s policies in the infrastructure sector is seen as a positive development for the sector, while her announcements to continue austerity policies are seen as a negative development seen.
Furthermore, despite infrastructure being a priority for the incoming government, the government’s high budget deficit, due to AMLO’s overspending on welfare programs and infrastructure developments in recent quarters, is likely to limit the new government’s ability to continue investing in the infrastructure sector with Sheinbaum speaking about the need for new highways, trains, airports and ports in her acceptance speech in early June 2024.
The outgoing president’s government will leave a number of infrastructure projects to the next government.
On June 3, 2024, AMLO reported that most government projects, including the Mayan Train Project and twenty hospitals, would be completed before he left office.
However, some work related to the renovation of the Customs, including the Nogales Railway Project, which will remove rail lines from Nogales to facilitate the expansion of the commercial port of Guaymas, will be completed by the next administration.
The federal government’s focus on completing major infrastructure works has boosted construction sector output in recent quarters.
According to the National Institute of Statistics and Geography, the monthly indicator of industrial activity (IMAI) in the construction sector increased by 9.6% year-on-year (yoy) in March 2024, following year-on-year growth of 12.2% in February and 16 .3% in January 2024.
The average IMAI in the construction sector increased by 12.6% in the first three months of 2024, from 95.1 in the first quarter (Q1) of 2023 to 107.1 in Q1 2024. In total, the IMAI registered an annual growth of 15.5% in 2023 and 2.8% in 2022.
There has been a notable increase in demand for infrastructure projects such as energy, warehouses, industrial parks and distribution or logistics points.
Mexico’s construction sector is expected to experience significant growth through the remainder of 2024, with the Mexican Chamber of Construction Industry expecting the sector (according to the latest estimates announced in early June 2024) to grow between 3 and 5% in 2024 will experience.
“AMLO Policies Must Continue After Sheinbaum’s Victory in Mexico Elections” was originally created and published by World Construction Network, a brand owned by GlobalData.
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