The Pragmatic Approach to Economic Growth
Claudia Sheinbaum, Mexico’s current president, has demonstrated a pragmatic approach to economic growth. She actively seeks collaboration with the private sector, consults with economists and bankers to accelerate growth, and is on the verge of announcing new investment plans in the energy sector. This proactive stance contrasts sharply with her predecessor’s reclusive tendencies, who spent most of his time after morning press conferences on self-promotion.
Building Trust with the Private Sector
Sheinbaum has not hesitated to extend olive branches to the private sector. She has convened economists with ideological affinity and met with banking leaders to discuss financing for strategic projects and private enterprises. She has also signaled a pragmatic approach for the energy sector and advocated for free trade in response to Donald Trump’s threats. However, these gestures of openness clash with the fortress of the Fourth Transformation and its legislative architecture, which has already dismantled independent bodies. The independence and credibility of the Judicial Power have also eroded during Sheinbaum’s tenure, leaving a new generation of eager-for-power and luxury ministers exposed.
The Contradiction of Sheinbaum’s Leadership
Next week, two significant announcements are expected, showcasing this duality of the current administration: an ambitious investment plan for the energy sector with hopes of extensive private participation and a proposed electoral reform aiming to perpetuate a single party in power.
For investors, reconciling the invitation to invest in energy with a justice system subservient to political interests and rules designed to eliminate opposition is impossible. The fiscal weakness and the cost of welfare programs, as highlighted by Fitch Ratings, further restrict the state’s capacity to be the sole economic driver.
Necessity, Not Conviction, Drives Collaboration with the Private Sector
Sheinbaum’s government requires private sector involvement not out of ideological conviction but due to arithmetic necessity. Without these capital inflows, the fiscal model of the Fourth Transformation cannot sustain growth.
The Risk of Imposing Authoritarian Measures
Despite her ability to listen and propose, Sheinbaum seeks to impose the ideological foundation inherited from her predecessor’s disastrous term. This pragmatism driven by necessity must be credible, as the private sector may deem the cost of trust too high if this mirage game continues.
Key Questions and Answers
- What is the current approach of Claudia Sheinbaum to economic growth? Sheinbaum has adopted a pragmatic approach, actively seeking collaboration with the private sector and consulting economists and bankers to accelerate growth.
- How does her leadership contrast with her predecessor’s? Unlike her predecessor, Sheinbaum is proactive and engages with the private sector, contrasting his reclusive tendencies.
- What are the upcoming significant announcements by Sheinbaum’s administration? The administration plans to unveil an ambitious investment plan for the energy sector with private participation and propose electoral reform to maintain a single party in power.
- Why is private sector involvement crucial for Sheinbaum’s government? Private capital inflows are necessary to sustain the fiscal model of the Fourth Transformation, as growth cannot be maintained without them.
- What risks does Sheinbaum’s administration face in imposing authoritarian measures? The private sector may deem the cost of trust too high if Sheinbaum continues to impose ideological measures, undermining the credibility needed for successful collaboration.
