Weekly Report 134

GENERAL SITUATION IN MEXICO

RELEVANT NEWS

DIGNIFIED VACATIONS: DEPUTIES’ COMMITTEE APPROVES THE INITIATIVE AND PASSES IT TO THE PLENUM

The initiative now establishes that at least 6 days of vacation can be taken continuously.

With a public division in Morena, the Labor Commis sion of the Chamber of Deputies approved the labor reform regarding dignified vacations in Mexico.

The initiative, which includes the ‘controversial’ chan ge that erased the possibility of taking 12 days of con tinuous vacation, was approved with 17 votes in favor, 4 against, and 2 abstentions.

The document now states the following:

“Working persons shall enjoy at least six days of vaca tion on a continuous basis, of the total period that co rresponds to them in accordance with the provisions of Article 76 of this law.”

According to the initiative, the other six days will be taken in a staggered manner as agreed between the workers and their employers.

KEY POINTS OF PRESIDENT ANDRES MANUEL LOPEZ OBRADOR’S Morning

Press Conference

November 30-December 6, 2022

POLITICAL AGENDA

• Electoral Reform: The President and the Minister of the Interior, Adan Augusto Lopez, announced that the initiative to reform the secondary laws on electoral matters will be presented on December 6 as a consequence of the opposition blocking the constitutional reform initiative in the Chamber of Deputies. He clarified that, in this way, it will not be possible to reduce the number of legislators and the budget to the parties; however, the INE’s budget can be modified in order to save money and control vote buying.

• New Federal Government airline: The President reiterated that there will indeed be a new airline and that it will be managed by the company Gru po Aeroportuario, Ferroviario y de Servicios Auxil iares Olmeca-Maya- Mexica S.A de C.V. Likewise, it is sought to be inaugurated next year, at the same time of the delivery of the Mayan Train. In this way, he assured that, with the new airline, the price of airline tickets will go down and that there is a pos sibility that cabotage will be authorized; although he expressed his hope that this measure will not have to be resorted to. He pointed out that the former workers of the extinct Mexicana Airlines

agreed to hand over the brand of the company for the creation of the new airline of the Federal Gov ernment.

• Report from the Governor of Campeche: The Gov ernor of Campeche, Layda Sansores, announced that, with the support of Rocio Nahle, Minister of Energy, there is a possibility that an aqueduct will be built in Ciudad del Carmen; construction would begin this year. She also commented that the con struction of a combined cycle plant could begin so that natural gas can reach the state of Campeche. Likewise, the Governor announced that the Fed eral Government will contribute with an extraor dinary 100 million pesos for the remodeling of the Historical Center.

ECONOMY

• Minimum Wage: The President of the Republic thanked the business sector because an agree ment has already been reached in the National Minimum Wage Commission (CONASAMI) on the minimum wage increase. He also highlighted the consensus between the business, labor, and gov ernment sectors. The Minister of Labor and Social Welfare, Luisa Maria Alcalde, stated that the mini

KEY POINTS OF PRESIDENT ANDRES MANUEL LOPEZ OBRADOR’S

mum wage increased from $172.87 to $207.44, an increase of 1,052 pesos per month. In the case of the northern border, from $260 to 312 pesos per day. In addition, he mentioned that 90% of the pur chasing power was recovered in real terms from 2018 to 2022.

• Credit Institutions Law Reform: A reporter asked about the President’s opinion regarding this issue. The President responded that the Minister of Fi nance, Rogelio Ramirez de la O, will give his opin ion on the matter. He also commented that there will be no changes in the banking operation rules because it was one of his campaign promises.

INTERNATIONAL

• Pacific Alliance and North American Summit: Re garding the upcoming trip to Peru on December 14, the President mentioned that the purpose of the meeting is to sign Pacific Alliance agreements between Chile, Colombia, Peru, Mexico, and the integration of Ecuador. He said that at the North American Summit, to be held on January 9 and 10 next year with his counterparts from the US and Canada, he will talk about the integration of all of Latin America. On the other hand, the President in dicated that his visit to Colombia could take place after such meeting.

• Foreign Investment: The President emphasized that Mexico is doing well with the USMCA, it is the most attractive country for foreign investment, which is growing like never before. He mentioned his desire for more and more investment to come to the south-southeast of the country. He reaf firmed that integration with the United States and Canada is yielding results, with Mexico being the main trading partner of the United States. It is im

portant to seek the union of the countries of the Americas because it could become the most im portant region in the world, but it lacks integra tion.

HEALTH

• Improvement of the health system in Campeche: The President announced today the start of the health improvement plan in the State of Campeche. To date, this plan has been installed in 9 states of the Republic: Nayarit, Colima, Tlaxcala, Baja Cali fornia Sur, Sonora, Sinaloa, Guerrero, Veracruz, and Campeche. Likewise, it is expected that by next year the plan will be present in all the states of the country.

KEY POINTS OF PRESIDENT ANDRES MANUEL LOPEZ OBRADOR’S

ENVIRONMENT

• Glyphosate and pesticides: Asked about the use of glyphosate and pesticides in food products, President Lopez Obrador mentioned that the is sue is being addressed and “they don’t want it banned.” He pointed out that those who defend glyphosate argue that there is still no substitute in the world. Hence, the president referred to the de cree to limit the volume of glyphosate used with the purpose of restricting its use more and more each year. In this sense, he commented that he is in contact with Conacyt to look for an applicable organic alternative.

• Brewery industry: Lopez Obrador stated that the ideal is to no longer give concessions in the use of water for industrial purposes in the north of the country since water for human consumption must

be guaranteed, as it is not rational to give priority to industries, mines or breweries or to consume water with arsenic, and to have to buy plants for the treatment of water with arsenic which is harm ful to health. Therefore, facilities are provided for those who need to install industries that require water to do so in the south-southeast of the coun try. He commemorated that the company under stood the situation, they were given an option in Veracruz and there they are already building their plant to export their product to the United States, mainly. He reiterated that no more water conces sions will be granted in the country to companies that consume too much water.

ENERGY

• Total Company: Commenting on the withdrawal of the French energy company from our country, due to the lack of legal certainty on the part of the En ergy Regulatory Commission (CRE) and PEMEX, the President commented that he has no informa tion. He stressed that there is no problem in the country with the arrival of investments. Likewise, he commented that all fuel distribution companies have 20-30-year concessions, which were granted after the energy reform of the Peña Nieto adminis tration, which does not have any problem, except for some cases where huachicol was sold.

• Relocation of PEMEX to Ciudad del Carmen: The President announced that PEMEX’s offices will be relocated to Ciudad del Carmen before the end of his six-year term. However, the governor of the state, Layda Sansores, intervened to comment that the city is already saturated and that there is no capacity to handle the relocation of offices. The President concluded by saying that the relocation will have to be studied in depth due to the Gover

KEY POINTS OF PRESIDENT ANDRES MANUEL LOPEZ OBRADOR’S

SECURITY

• Veracruz: President Lopez Obrador highlighted the rehabilitation of the Fort of San Juan de Ulua and announced the rehabilitation of the building where Benito Juarez signed the Reform Laws. The President mentioned that Governor Cuitla huac Garcia is making an exemplary government, above all that has to do with honesty. Likewise, General Rafael Ojeda, head of the Ministry of the Navy, presented a report on the state’s security situation. Among the data on the crime rate, there was a drop in crimes such as intentional homicide, kidnapping, and femicide. The governor informed that Veracruz, in impact crimes per 100,000 in habitants (December 2018 - October 2022), ranks seventh nationally in extortion, ninth in robbery of transportation companies, and twelfth in business robbery.

nor’s comments, but that it is a commitment made with Ciudad del Carmen, so the proposal must be taken seriously.

• Dos Bocas Refinery: The President mentioned that it is in an integration phase and said that by mid-2023 it will be operating at full capacity. He emphasized that it would process 340 thousand barrels of fuel and acknowledged the work carried out by ICA, Techint, and Samsung. He also com mented that 50 billion pesos have been invested in rehabilitating six refineries. He stated that ev erything aimed at food and energy self-sufficien cy must be a priority.

• Hydrocarbon theft: President Andres Manuel Lo pez Obrador mentioned that an average of 5,600 barrels per day are stolen in the country; when he started his government there were 80,000 barrels per day. He commented that huachicol has been reduced in Veracruz and that problems continue in Hidalgo and Puebla. The President highlighted that the fight against huachicol has generated sav ings of more than 231 billion pesos. This amount is equivalent to twice the budget of Veracruz.

NEWS BY STATE

BAJA CALIFORNIA

During the working visit of the Secretary of Foreign Relations Marcelo Ebrard of fered support in training and taking ad vantage of international agreements to promote the Baja California Aerospace Cluster. And the President of Index, Luis Manuel Hernandez, highlighted that in the country the industrial sector rep resents 18% of formal jobs, 62% of ex ports and 18% of the Gross Domestic Product (GDP) and that it’s also the sec tor that invest more in research and de velopment.

SONORA

Jesus Gamez Garcia, president of Index Sonora, indicated that this year they will close with 225,000 jobs and it is ex pected that 15,000 jobs will be generat ed in the first half of next year, but this will depend on job stability. Job stabili ty and regularizing supply chains will be the main challenges for next year for the Maquiladora and Export Manufacturing Industry, which aims to reach 240,000 jobs in the State in the first half of the year, mentioned.

NEWS BY STATE

NUEVO LEON

The city of Monterrey and the metropol itan area report a high risk due to poor air quality, which considerably affects the health of Monterrey residents. The State Government activated the envi ronmental alert due to the poor air qual ity that prevails.

COAHUILA

The United States ambassador to Mexico, Ken Salazar, assured that during his visit to Mazatlan, he reaffirmed that Sinaloa, Coahuila and Durango have a strategic place for food security in North Amer ica and to strengthen regional supply chains.

TAMAULIPAS

The Secretariat of Economic Develop ment in Tamaulipas lists two projects considered important to develop in Ciu dad Victoria and to support the central region, one of them is a productive park called “Bienestar TecnoTam”, which will operate with clean energy and will have services for workers.

QUERETARO

The Governor of Queretaro, Mauricio Kuri Gonzalez, through the Ministry of Finance, presented the fiscal miscellaneous and the 2023 economic package to the LX State Legislature, which amounts to 51,636 mil lion pesos, which translates to 12.5% more than the previous year. The State Presi dent explained that the 2023 economic package was prepared in a prudent man ner because it is based on projections made by the Federation and the special ists themselves, establishing a Gross Do mestic Product growth between 1.2% and 3.0%, as well as an inflation forecast for the end of 2023 of 3.2%. Mr. Kuri Gonzalez added that, in order to benefit the citizens in the homologation of tax criteria and determination of contributions, the Fiscal Pact between the State and its 18 munic ipalities was consolidated, which seeks to strengthen the State’s finances in an inte gral manner. As part of this fiscal pact, the initiative presented reflects the unification of the entity to contribute to the develop ment policy of the tourist activity in the area of lodging establishments, for which a rate of 2.5% is contemplated at the state level, complemented with the 1% that cor responds to the municipality, so that in a single window and before a single tax au thority, taxation is carried out promoting digital media.

JALISCO

The Government of Jalisco launched the public policy called Jalisco Tech Hub Act, which has among its main objectives the consolidation of the innovation and high technology ecosystem that is based in the state, and the creation of conditions that facilitate the process of relocation of indus tries known as nearshoring. This strategy, which was presented by Governor Enrique Alfaro Ramirez, will have three main lines of action: first, the redesign of the educa tional offer both in the Guadalajara Metro politan Area and in the rest of the regions of Jalisco, to adapt it to the needs of the innovation and high technology ecosys tem. Second, the delivery of government incentives to support the companies of such ecosystem; and third, the supply of land precisely to make possible the arrival of the companies that are relocating their facilities to settle them now in the Mexican territory, within this nearshoring trend. The investment planned by the Government of Jalisco to implement the Jalisco Tech Hub Act policy in 2023 is 1,184 million 334,238 pesos, which should have a favorable im pact on this innovation and high-tech eco system, made up of companies such as Siemens, HP, Intel, IBM, Bosch, and Oracle, although in general, it has more than 600 high-tech companies, 300 software and services companies, and 5 incubators and technology parks.

GUANAJUATO

Guanajuato’s Secretary of Economic and Sustainable Development, Ramon Alfaro, commented that the five projects for the state for next year are from Europe and Japan. He said that the projects are related to photovoltaic and hydrogen-based ener gy generation. We have a portfolio that we are going to promote together with Envi ronmental Management, the energy agen cy, and it is not only a photovoltaic issue, nor additional to the San Felipe project, but other alternatives such as generating hydrogen-based energies, that is what we are also working on,” he said.

AGUASCALIENTES

The Municipalities of Aguascalientes and San Luis Potosi held a meeting to establish collaborative work in favor of the econom ic development of both cities. Francisco Javier Sanchez Lopez, Director of Econ omy of the Secretariat of Social Econo my and Municipal Tourism (Setum) held a meeting with Jaime Chalita Zarur, Director of Economic Development, and Enrique Gonzalez Hernandez, General Coordinator of the San Luis Potosi City Council, in which they analyzed experiences to strengthen public policies and programs in this area. The meeting was held at Setum’s facilities where they also agreed to exchange proj ects that contribute to the generation of new jobs, as well as to the opening of suc cessful businesses that promote greater economic flow and benefits for entrepre

neurs. Francisco Javier Sanchez reaffirmed the commitment of the Municipality of Aguascalientes to collaborate to promote the integral development of this region of the country.

SAN LUIS POTOSI

According to figures from the National Insti tute of Statistics and Geography (Inegi), in the third quarter of 2022, the unemployed population in the country was two million people, which means that the correspond ing Unemployment Rate was 3.4 percent, lower than the figure recorded in the same period of the previous year, which was 4.2 percent. At the end of the third quarter of the year, 43,323 people were unemployed in San Luis Potosi, which represents 3.4 percent of the economically active pop ulation of San Luis Potosi. However, as in the rest of the country, the percentage of Economically Active Persons dedicated to informality increased to 55.0 percent, far from the first places of informality.

NEWS BY STATE

CDMX

The Minister of Government (Secgob), Marti Batres, informed that on instructions from the Head of Government, Claudia Sheinbaum, he will head dia logue tables to listen and address the concerns of the neighbors who are de monstrating at the intersection of Nue vo Leon and Mexico avenues, in the Xo chimilco district, in order to prioritize dialogue on the works being carried out by the Mexico City Water System (Sa cmex). Accompanied by the general coordinator of Sacmex, Rafael Carmona, he clarified that the work was requested by neighbors, which consists of draina ge and sanitation, not to extract water from the area, and whose objective is to protect the health of the population of Xochimilco and avoid pollution of the Caltongo canal.

STATE OF MEXICO

With the aim of safeguarding the inte grity of property and people who live in and transit through the territory of the State of Mexico, as well as that of migrant visitors arriving in the state, the “Migran te Mexiquense Operativo de Invierno 2022-2023” program was launched. This was announced by the Ministry of Se curity (SS) through the Undersecretary of State Police and the Coordination of International Affairs of the Government of the State of Mexico, through a press release. For this reason, 18 modules of attention to migrants were installed at the points of greatest transit flow in the State of Mexico, where people can find information, support services, guidance, and road assistance 24 hours a day.

INVESTMENT NEWS

NORTHEAST

- MEOR

On Tuesday, November 29, Meor inaugurated the HubsPark industrial park in Apodaca, Apodaca in which 300 million pesos were invested and 800 di rect jobs and 1,500 indirect jobs were generated.

- DAYE

On Tuesday, November 29, Daye announced that it will invest 120 million dollars in a plant in the mu nicipality of Salinas Victoria, Nuevo Leon, which will employ 2,000 workers. The company specializes in the production of power tools and smart garden pro ducts.

- LEAR CORPORATION

On Wednesday, November 30, Lear Corporation in augurated the expansion of its plant in Zacatecas, Mexico. The investment was 160 million pesos and will generate 600 new jobs.

NORTHWEST

- GILERO

On Tuesday, November 29, Gilero opened a new plant in Tijuana to manufacture high-tech products for the medical sector. The initial investment was 2.5 million dollars and the corporation announced an investment of 4 million dollars by 2024 and 350 jobs are expec ted to be generated.

-BECTON DICKINSON

On Wednesday, November 30, BD inaugurated a hi gh-tech medical device plant in Tijuana, Baja Califor nia. The investment was 38.6 million dollars and is expected to generate 500 new jobs over the next 2 years. Phase one starts with 75 jobs.

CENTRAL MEXICO

- REALIX ESTATES

On Monday, November 28, Grupo Realix Estates star ted construction of the Industrialix Industrial Park, with an investment of 1,572 million pesos in the muni cipality of Corregidora, Queretaro.

GUNTHER WERKS

On Wednesday, November 30, the governor of Gua najuato, Diego Sinhue Rodriguez met with the CEO and founder of Gunther Werks with the purpose of attracting investment in advanced technology for automotive vehicles.

LABOR

VACATION DAYS INCREASE IN MEXICO

This week the labor and social security committee at the Mexican chamber of deputies resume the debate and analysis of the legisla tive bill to increase the minimum vacation days in Mexico.

The committee has approved the senatorial bill to increase the min imum days to 12 but with minor changes, keeping only 6 mandato ry consecutive days instead of mandating 12 consecutive vacation days. The legislative bill is expected to go to the floor of the lower house next Thursday December 8 and then back to the senate for the final legislative process.

Once approved by the Mexican congress changes to the vacations days must be posted in the Mexican official gazette to finalize its legal process an become law starting Jan 1st 2023.

ALVARO GARCIA HR, Vice President

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