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On Saturday, Enrique Pena Nieto was signed in as the new president of Mexico, the second largest economy in South America. He won the elections with promises of ending the years of violence that have gripped the country, boosting the failing economy, and encouraging foreign investment in the state oil company Pemex in order to turn Mexico into a major oil exporter once again.
In his inaugural speech in the centre of Mexico City Pena Nieto firmly said that “the state has lost ground in important areas. Lawlessness and violence have robbed various parts of the country of peace and freedom. My government's first aim will be to bring peace to Mexico.”
Mexico really has been struggling for the last few years. Its economy is far weaker than it should be and growing at a much slower rate than most South American countries. It has been plagued by gang and drug violence, which saw more than 60,000 people killed during Felipe Calderon’s term, the predecessor to Pena Nieto.
Calderon time in office was not helped by the fact that his PAN party never held the majority in Congress and therefore could not push through the legislation it wanted in order to make the changes that it had envisaged.
Related Article: Mexico May Open Up Oil Market on Heels of Major Finds
Pena Nieto and his PRI party do not suffer from the same fate and have already seen a labour reform passed by Congress since his election victory. Next he wants to strengthen Mexico’s tax base and encourage private investment in Pemex.
Mexico has some huge oil reserves, and new ones are being discovered all the time, such as two new fields up in the Gulf of Mexico, or others in the state of Tabasco. Foreign capital will help develop these new finds, and return Mexico to the oil producing power that it once was.
By. Joao Peixe of Oilprice.com
Joao is a writer for Oilprice.com