What is happening both in the airline industry with the measures adopted by the Department of Transportation in the United States that put AIFA, Mexican airlines, and border transportation in check, as well as the problems that several entities of the Republic faced due to blockades of corn producer organizations, have a common cause: López Obrador’s errors.
In the case of aviation, López Obrador’s first mistake and whim was the closure – against all economic logic of the NAIM – and the construction of the AIFA, which was inaugurated without access roads, which translated into a very low influx of passengers and, to promote it, it was unilaterally decided to transfer all cargo operations from the AICM to the AIFA, and reduce the takeoff and landing spots or times at the AICM from 53 to 43 per hour.
Both the transfer of cargo operations and the reduction of slots in 2023 generated protests from United States airlines and the Department of Transportation. With the arrival of Trump, and Sean Duffy as head of the DOT, complaints from the United States increased, accusing Mexico of violating the 2015 Bilateral Air Agreement and since last August it has demanded that the 2023 Decree be repealed, announcing the first restriction measures on Mexican airlines, and ending the antitrust immunity of Delta and Aeroméxico, which are legally challenging the decision in the United States Courts.
The new retaliatory measures – unprecedented in the bilateral relationship – imply a severe impact for AIFA, which will lose income due to the cancellation of 13 routes to the United States, as well as for Aeroméxico, which had to cancel its route and inaugural flight to Puerto Rico on Wednesday; to Viva Aerobús, which already had tickets sold just at the start of the winter season for 9 new routes to the United States, from AIFA, which began in November, and to Volaris, which had a new route to Newark.
If an agreement is not reached with the DOT, all new routes from the AICM and AIFA to the United States will be stopped, and in 4 months airlines will not be able to transport cargo from the AICM.
President Sheinbaum and the head of the SICT, Jesús Esteva, deny that the Bilateral Air Agreement has been violated, and are looking for a political background that will make an agreement difficult.
Another problem is that neither in this government nor in that of López Obrador, the head of the SICT has managed to efficiently coordinate either the director of the AIFA or the director of the AFAC, which depend on the Defense; nor to the director of the AICM, which depends on the Navy. It is urgent that Sheinbaum put order in the sector and strengthen Esteva.
Agro, the cost of disappearing market mechanisms
In the case of agriculture, road blockades in 20 states set off warning signals in the business sector due to the delay in delivery of goods and pressure from farmers so that, in addition to a greater government subsidy, companies are forced to pay a higher price for corn, which would generate an increase in prices and greater inflationary pressures due to the rise in tortilla prices.
The origin of the problem is the erroneous agricultural policy of López Obrador, who disappeared market mechanisms such as reference prices, which gave certainty to all producers, regardless of their size.
In addition, transgenic corn, which is allowed in the United States, was prohibited, causing our producers to lose competitiveness; price coverage schemes disappeared; insurance and soft credit with the extinction of the National Financial Institution for Agricultural, Rural, Forestry and Fisheries Development (FND).
In its place, a social support scheme was launched for small producers that is welfare-based and generates votes, but not productivity in the field.
The crisis broke out due to the drought of recent years, the increase in production costs, and the lower prices of grains and oilseeds in the international market.
In this regard, Juan Carlos Anaya, CEO of Grupo GCMA, criticized the agreement reached with the Bajío producers because it generates a gap of up to 1,400 pesos per ton between regions and lacks clear criteria to define the market price.
He urged a return to the objective or reference income, or well-being if you want to call it that, because the important thing is not the name but rather generating certainty.
He assured that the target income should also apply to sorghum and durum wheat, which are outside the guaranteed prices and return to contracts or agreements between producers and buyers, with a market, supply and demand mechanism.
GDP fell 0.3% in the 3rd Quarter
At the end of Q3, GDP fell 0.3% and the SHCP’s goal of growing 1% this year will definitely not be achieved.
Secondary activities, that is, industrial activities, fell at an annual rate of 2.9%, while premiums grew 3% and tertiary activities that cover commerce and services rose 0.9%.
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