Has Mexico's moment finally arrived?

http://www.theguardian.com/world/2014/jan/09/mexico-moment-reforms-enrique-pena-nieto

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Mexico begins the new year bathed in predictions that its "moment" has finally arrived thanks, primarily, to a frenzy of reforms since President Enrique Peña Nieto took office in December 2012.

But beneath the glow, question marks hang over the country because of its longstanding security crisis, rampant poverty, inequality – and even the reforms themselves.

"If things go well, Peña Nieto could go down in history as one of the great reformers of the past 100 years," says political analyst Raymundo Riva Palacio. "If it does not, the failure will be monumental."

The reforms include education, telecommunications and tax overhauls, crowned by last December's audacious constitutional changes that open the way for more private sector participation in the crisis-ridden state-owned energy sector.

For Pierpaolo Barbieri and Niall Ferguson, writing in the Wall Street Journal, the reforms put Mexico on the threshold of transforming itself "from Latin America's laggard into North America's new engine of growth".

Mexican economists tend to be less upbeat. "The reforms should give the 'Mexican moment' some momentum," says Carlos Elizondo, a staunch supporter of the free market vision that inspired the changes. "Now the government has to deliver."

It already seems clear investors are holding back until they see what kind of secondary legislation is put in place to make the reforms operable, while left-leaning observers are particularly concerned about the capacity of national regulators to have any control over multinational companies, particularly in energy.

Economist Rogelio Ramírez de la O takes his criticism deeper. "The reforms are not enough," he says, pointing to the absence of a complementary drive to dynamise the domestic economyand allow Mexico to become less dependent on exporting to US consumers. "They do not validate talk of a moment."

Almost everybody, meanwhile, stresses the potential impact on investor confidence of drug war-related violence and regional governability crises that have continued unabated since Peña Nieto took office, though they receive less media attention.

The national official death toll has fallen slightly, but even the government admits that kidnapping rates have risen dramatically. Some regions also hover on the verge of civil war as new armed vigilante groups challenge the influence of the cartels and the security forces seem at a loss about what to do.

Even the best-case scenarios predict that the majority of Mexicans will see no direct benefits, such as lower energy bills, from the reforms for at least 18 months. It will take years more for even substantially higher GDP growth than the paltry 1.3% managed in 2013 to make any dent in the poverty that affects about half the population.

The current disarray of Mexico's political left also leaves fewer institutional channels for neutralising growing signs of radical discontent in a country with world-record inequality rates where conspicuous corruption remains common.

In his new year message Peña Nieto urged Mexicans to think of 2013 as "the year Mexico dared to take off". A look at the projected flight path suggests he should prepare for turbulence.

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