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GENERAL SITUATION IN MEXICO

Weekly Review # 56 I May 26, 2021

TOWARDS THE “NEW NORMAL”

DISTRIBUTION OF DEATHS PER STATE DUE TO THE PANDEMIC

INFORMATION UPDATED ON MAY 24, 2021 AT 19:00 HRS LOCAL TIME.

NEW CASES REPORTED: 703

SOURCE: https://www.gob.mx/salud/

CONFIRMED CASES: 2,397,307

NEW DEATHS REPORTED: 48

CONFIRMED DEATHS: 221,695

INCREASE OF CONFIRMED CASES SINCE THE FIRST REPORT MAP WITH THE DISTRIBUTION OF THE INCIDENCE RATE OF ACCUMULATED CASES OF COVID-19 BY ENTITY OF RESIDENCE.

National rate 1858.77

0 to 500 (1 states) 501 to 1,000 (4 states) 1,001 to 1,500 (12 states) 1,5001 to 2,000 (6 states) >2,000 (9 states)

Elaborated by Prodensa with information from the Health Ministry of Mexico

PANDEMIC’S SITUATION IN THE WORLD • As of May 24, 2021, globally there have been reported confirmed 166,860,081 cases (508,074 new cases) of COVID-19 and 3,459,996 deaths (10,807 new deaths*). Lethal rate: 2.1%. • In the last 14 days, the number of new cases accounts for 5% (8,674,988) of the total of accumulated cases. *https://www.who.int/docs/default-source/coronaviruse/situation-reports/20200323-sitrep-63-covid-19.pdf?sfvrsn=d97cb6dd_2

SOURCE: https://www.gob.mx/salud/

TOWARDS THE “NEW NORMAL” INCIDENTS OF CONTAGIONS IN THE POPULATION BY REGION AS OF MAY 24

DEATH INCIDENTS IN POPULATION BY REGION AS OF MAY 24

SOURCE: https://www.gob.mx/salud/

KEY POINTS OF PRESIDENT ANDRES MANUEL LOPEZ OBRADOR’S Morning Press Conference May 19-25, 2021

COVID-19 Dr. Hugo Lopez-Gatell commented that there had been a sustained reduction for 19 weeks. He indicated that Mexico is in a situation similar to the one in April 2020, but with the difference that there is a downward trend. He pointed out that the vaccination of people aged 50 and over is still ongoing.

G-20. WORLD HEALTH SUMMIT The President participated at the World Health Summit and greeted the countries’ leaders that make up the G-20. He welcomed and approved the proposal of the President of the United States, Joseph Biden, to make available the patents of the pharmaceutical companies that produce the vaccines against COVID-19.

VACCINATION PLAN Lopez Obrador pointed out that the medical personnel of COVID-19 hospitals has already been vaccinated. He added that teachers have already been vaccinated in 30 of the 32 states in the country. He commented that it is still planned that the population over 18 years of age will be vaccinated by October. He estimated that in June, the vaccination of people over 40 could begin.

BANK OF MEXICO The President informed that the current Governor of the Bank of Mexico, Alejandro Diaz de Leon, will not be renewed. An economist with a social dimension with experience who has worked in an area related to financial management will be promoted to fulfill the requirement.

ECONOMIC RECOVERY Regarding the credit rating with a stable outlook, President Lopez Obrador commented that the economic growth forecasts are being met and that both rating agencies, banks, and financial organizations, agree that it will grow from 5 to 6% this year and that Mexico is already recovering.

SOURCE: https://www.youtube.com/channel/UCxEgOKuI-n-WOJaNcisHvSg

BUDGET 2022 As an express question about the 2022 budget, President Andres Manuel Lopez Obrador commented that they are working to determine how to finance all projects for the country’s development. He pointed out that the budget for the priority programs and the one contemplated for Dos Bocas, the Mayan Train, the modernization of the six refineries, the Felipe Angeles airport is guaranteed.

VACCINATION PROGRESS

As of May 24, 26,655,760 doses had been applied. 11,794,554 people have the complete scheme. Information regarding age groups and health or education workers is no longer available. As of now, 34,179,015 doses have been received. The vaccines applied in Mexico are Pfizer BioNtech, AstraZeneca, SinoVac, Sputnik V, and Cansino.

MEASURES TAKEN BY STATES IN MEXICO

BAJA CALIFORNIA Remaining in the medium risk tier for the week of May 24th to May 30th, Baja California state officials report 370 active Covid-19 cases along with the state, with a decrease in most municipalities, except for Ensenada and Tecate. Hospital occupancy remained basically the same, at 24.93%, with 436 hospital beds available and 240 available respirators. According to the last cut on May 25th, 446,976 people have been vaccinated, including adults over 50 years old, medical staff, academic staff, and pregnant women, and vaccination will continue for adults over 50 years old, mainly in the cities of Tijuana and Mexicali. In a joint effort between the private and public sector, with much lobbying with the US Government, six companies in Tijuana, including Poly, Coca-Cola, Jacuzzi, Flextronics, Baja Call-Centers, and Sempra-IENOVA, have received permission to vaccinate 10,000 Mexican collaborators in a specially designed location in the Tijuana-San Diego border. This effort may be replicated in other border cities to accelerate the vaccination plan in the manufacturing sector.

SONORA With all 72 municipalities of Sonora in a green light, the State of Sonora continues to be considered in the lowrisk tier for the week of May 24th to May 30th. According to the official report on May 25th, that there are currently 680 active Covid-19 cases in the state, a large decrease from 731 cases from last week. Reports also confirmed that there are 64 current hospitalized Covid-19 patients, also in decrease, with 42 patients are considered acutely ill and 15 critical patients using respirators. There were also reported 45 new confirmed cases, and there have not been new losses of life in the past 24 hours, although there was one reported fatal case during the weekend. With the vaccination plan underway, it was reported that a new shipment with over 84,000 AstraZeneca vaccines was received in Sonora and will be applied to adults between 50 to 59 years old in the municipalities of Caborca, San Luis Rio Colorado, Sonoyta, Magdalena, Empalme, Benito Juarez, Cajeme, and Huatabampo starting on May 25th.

MEASURES TAKEN BY STATES IN MEXICO

COAHUILA The governor of Coahuila, Miguel Angel Riquelme Solis, led the meeting of the Work Table of the Education Sector in the region. He thanked everyone for their contribution in the Pilot Test for school return that does not present setbacks. He asked that of the 70 schools that have already returned and of the 110 expected to return on May 31, to make a report of infrastructure and labor problems. He informed that 8,000 students are back in the public sector, that there were no indicators of contagion during the first week. NUEVO LEON Following Monday, May 31, the government plans to resume face-to-face classes in high school and higher education, while the cases of COVID-19 contagion began to rise from the middle of the previous week. For the moment, the health authorities of the entity maintain the intention of allowing face-to-face classes. Still, it will depend on the evaluation they will make next Thursday, May 27, when the indicators on the behavior of the pandemic will be reviewed.

TAMAULIPAS Tamaulipas will continue in the yellow COVID-19 risk epidemic semaphore until June, as determined by the Federal Government’s Health Secretariat, which can be related to the upward trend reported by the entity. In the daily coronavirus conference held in the National Palace, it was reported that the extension of the medium risk level will be in effect until June 6, so the start of the pilot phase of face-to-face classes scheduled for this May 31 at 11 schools in Tamaulipas, will be carried out under this risk of a pandemic.

MEASURES TAKEN BY STATES IN MEXICO

JALISCO The Ministry of Health of Jalisco registered 88 new coronavirus infections, bringing the total number of confirmed cases to 249,370 in the state. Vaccination against COVID-19 in municipalities of three regions of Jalisco (Tamazula, Ciudad Guzman, and Puerto Vallarta) closed with 28 thousand 388 doses of the AstraZeneca vaccine that were applied in adults aged 50 to 59 years; and 818 doses of the Sinovac vaccine with which it seeks to protect pregnant women. At the same time, immunization began this Monday in 41 municipalities in seven regions. All vaccines are safe and effective in preventing severe complications from this disease. It is important to remember that immunity against the coronavirus is reached 15 days after the second dose (or, in its case, the only dose). Even vaccinated persons can become infected and spread the coronavirus. Therefore prevention measures should be maintained.

GUANAJUATO During the last 24 hours, the Ministry of Health of Guanajuato reported only two new confirmed infections of COVID-19 in the entire state. Still, there were also nine deaths of people infected with this disease. The only two cities that recorded a new infection were Irapuato and Salamanca. The municipality of Leon had no cases yesterday. However, out of the nine deaths, four correspond to Leon’s residents, two more were from Irapuato, and the cities of Salamanca, San Francisco del Rincon, and Valle de Santiago registered the death of one of their residents infected with the coronavirus. In all of Guanajuato, 11,036 people have died from this disease, and 121,523 people have recovered.

MEASURES TAKEN BY STATES IN MEXICO

QUERETARO The Ministry of Health informed that four people died from COVID-19, and 28 more were infected. In total, there are 68,176 cases and 4,774 deaths. There are also 66 hospitalized patients; 30 of them are seriously ill. Therefore, hospital occupancy is 7%, 9% in beds with ventilator, and 6% in beds without a ventilator. Given the change to green traffic light of epidemiological risk, caution must be taken to avoid the risk of an increase in the number of COVID-19 infections, affirmed the Organizational Spokesperson, Rafael Lopez Gonzalez. He specified that although the vaccination against COVID-19 is progressing, this is not enough to contain the pandemic, so people vaccinated should continue with the sanitary measures. He pointed out that although hospitalization shows a downward trend, the number of people who need to go to the hospital could increase due to increased active cases.

AGUASCALIENTES The Institute of Health Services (Issea) reports a total of 22,394 cases of COVID-19 in the state, 25 more confirmed in the last 24 hours. There are ten deaths due to COVID-19 and 48 people receiving hospital care due to complications from the disease. A total of 48 tests of people suspected of carrying the virus are being analyzed, and 350,435 doses of vaccines have been administered to senior citizens, health and education sector personnel, people between 50 and 59 years of age, and pregnant women. On Monday, May 24, the vaccination against COVID-19 continued for all those people between 50 and 59 years of age, who live in the capital city and for some reason have not been able to attend the previous days; people over 60 years of age who live in any municipality of the state and who have not received the first dose will also be immunized. Pregnant women over 18 years of age and who are nine weeks pregnant will also be vaccinated.

MEASURES TAKEN BY STATES IN MEXICO

STATE OF MEXICO The State of Mexico will continue to be in yellow at the epidemiological traffic light. Health measures such as the use of facemask and social distancing continue to be in place, and the return to face-toface classes may take place at the same time in Mexico City (June 7).

CDMX Mexico City authorities announced that the city will continue to be in the yellow epidemiological traffic light. They noted that this is the first time since April 13, 2020, that the number of people hospitalized for COVID-19 in Mexico City is below 1,000. Mexico City Mayor announced that face-to-face classes will start in Mexico City on June 7. All schools must include strict health measures such as having all teachers and education workers vaccinated, use of facemasks at all times, use of filters, use of open spaces, social distancing, among others.

MANUFACTURING INDUSTRY OUTSOURCING REFORM: A THORN ON THE SIDE FOR MEXICO COMPETITIVENESS. In recent days, the reform to the Federal Labor Law regarding labor subcontracting, commonly known as the Outsourcing reform, came into effect. Among the main objectives of the changes to our legislation is eliminating tax evasion and avoidance carried out by some companies through outsourcing and guaranteeing that workers have all the labor rights granted by law. This law prohibits the subcontracting of personnel but allows the subcontracting of specialized services that are not part of the corporate purpose or the main economic activity of the company. It also establishes the obligation to keep a registry before the Ministry of Labor and Social Welfare (STPS, in Spanish) and the registration in the public registry of subcontracting companies of services and specialized works, the joint and several liabilities in case of non-compliance, the granting of a three-month term for the subcontracted workers to become part of the payroll, among others. While the intention is to protect workers and prevent abuse of subcontracting, these will undoubtedly have a significant impact on economic activity, competitiveness, and job creation. Many experts have pointed out that the elimination of subcontracting will entail the risk of job losses and an increase in informality since many companies that currently have subcontracted personnel will not be able to hire them directly. In addition, the transition time for companies is very short (three months), and the penalties for non-compliance are very high (categorized at the same level as organized crime). Many of the large transnational companies operating in the country under this contracting scheme may be forced to reduce their operations and will not rehire the personnel under their payroll. Usually, these companies, most of them small and medium-sized, use this contracting system not to avoid their responsibilities but because it allows them to optimize their production processes and reduce costs. These savings, in turn, allow companies to invest in

innovative systems that add extra value to production, making them more competitive. In addition, outsourcing allows for greater labor flexibility and adaptability, which are essential factors to face the rapid changes in the market. In this sense, specialists consider that the new regulation does not manage to eliminate the fundamental problem of tax evasion and avoidance, since those who carry out this type of practices have other mechanisms to evade responsibilities, such as the payment of fees to continue reducing their labor costs and to carry out temporary contracts, among others. This reform will also increase bureaucracy by imposing more requirements to register with the STPS. The elimination of subcontracting has all the characteristics to become the thorn on the side for Mexico’s competitiveness. It represents a radical change in the labor market that will generate uncertainty among economic agents and be detrimental to competitiveness. Additionally, the timing could not be worse. This reform is being promoted just when needed, perhaps more than ever, to reactivate employment and generate confidence to attract investment to the country.

GOOD NEWS

MEXICO TO BEGIN PHASE THREE TRIALS OF SANOFI, WALVAX COVID-19 VACCINES On Monday, Mexico Foreign Minister Marcel Ebrard said the country will soon begin phase three trials for COVID-19 vaccines by France’s Sanofi and China’s Walvax. Mexico’s health regulator Cofepris gave approved on Monday the trials of the Sanofi vaccine, which uses recombinant proteinbased technology. Phase three trials of the vaccine by China’s Walvax Biotechnology are also about to begin in Mexico. Walvax, which uses similar technology to the shots by Moderna and Pfizer, will use about 6,000 volunteers for the late-stage trials, the government said previously. Mexico’s own “Patria” COVID-19 vaccine will soon enter phase two trials, Ebrard said. The government has said the vaccine could be approved for emergency use this year. According to government data, Mexico has received about 33.5 million vaccine doses from foreign suppliers, including Pfizer, AstraZeneca, and China’s Sinovac. Ebrard said Mexico would have 40 million doses by June, increasing to 65 million by July.

SOURCE: REUTERS

EHS

RECOMMENDATIONS RECOMMENDATIONS FOR FULLY VACCINATED PEOPLE People are considered fully vaccinated for COVID-19 ≥2 weeks after they have received the second dose in a 2-dose series (Pfizer-BioNTech or Moderna) or ≥2 weeks after they have received a single-dose vaccine (Johnson & Johnson [J&J]/Janssen); there is currently no post-vaccination time limit on fully vaccinated status. Unvaccinated people refer to individuals of all ages, including children, that have not completed a vaccination series or received a single-dose vaccine. Guiding Principles for Fully Vaccinated People • Indoor and outdoor activities pose minimal risk to fully vaccinated people. • Fully vaccinated people have a reduced risk of transmitting SARS-CoV-2 to unvaccinated people. • Fully vaccinated people should still get tested if experiencing COVID-19 symptoms. • Fully vaccinated people should not visit private or public settings if they have tested positive for COVID-19 in the prior 10 days or are experiencing COVID-19 symptoms. • Fully vaccinated people should continue to follow any applicable federal, state, local, tribal, or territorial laws, rules, and regulations.

DAVID ANTUNEZ Environmental, Health, and Safety Director.

BASIC PROTECTIVE MEASURES AGAINST COVID-19

1 2 3 4 5 Wash your hands frequently with soap and water for 20 seconds.

When coughing or sneezing, cover your nose and mouth with a disposable tissue or use the inside corner of your arm.

Avoid shaking hands and kissing.

Keep your workspace clean and don't share personal items and utensils.

If you show symptoms of a cold or flu, go to a doctor. Do not self-medicate and inform your supervisor and Human Resources department.

VACCINATION FOR ADULTS OVER 50 YEARS OLD Vaccinations for adults over fifty years of age have recently started in several cities of the country. This segment of the adult population is beginning to include a larger number of working people who, to attend the time and place on the date that corresponds to their last name or address, may need to be absent from work when the appointment coincides with their working hours. Companies should consider that the labor authority has indicated that employers will not be able to deduct from the salary the hours that the worker is absent to go to the vaccination.

ALVARO GARCIA HR, Vice President

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