How Judicial Reforms Could (or Couldn’t) Impact Mexico

?? Mexico's Judicial Gamble: Reform Amidst Transition

As Mexico navigates the twilight of López Obrador's presidency and the dawn of Sheinbaum's historic tenure, we're examining a controversial judicial reform that's captivated the nation.

Our analysis reveals the scope of this change: by 2025, all Mexican judges will be elected, not appointed. Despite dire predictions, we've uncovered surprising economic stability - the stock exchange rose from 50,900 to 53,000 points post-reform. With 39% of prisoners held without official rulings, could this overhaul address systemic issues, or is it a political overreach?

As always, you're reading ConteNIDO, your go-to place for all things tech, AI, and innovation. Make sure to subscribe to receive our up-to-date analysis ??

Nido Indicators ????????

Auto Exports: 292,670 units on Aug 01, 2024 (??9.08% from Jul 01, 2024)

Consumer Confidence Indicator in Mexico: 47.60 points on Aug 01, 2024 (??1.06% from Jul 01, 2024)

Consumer Confidence Indicator in United States: 70.10 points on Sep 01, 2024 (??3.24% from Aug 01, 2024)

Federal Reserve Interest Rate: 5.00% on Sep 18, 2024 (??9.09% from Jul 31, 2024)

Bank of Mexico Interest Rate: 10.50% on Sep 26, 2024 (??2.33% from Aug 08, 2024)

USD-MXN Exchange Rate: 19.8017 on Oct 01, 2024 (??0.42% from Aug 30, 2024)

S&P/BMV IPC: 52,477.30 points on Sep 30, 2024 (??491.43 points from Aug 30, 2024)

Inside Nido: What we are doing

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• Forward Deployed Analytics Engineer, Mexico City, Mexico
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• Founding Engineer, Medellín

In the Know with Nido: What we are reading

???? Claudia Sheinbaum Sworn in as Mexico's First Female President

Claudia Sheinbaum, North America’s first female president, took office with a historic mandate. She inherits challenges like economic slowdowns, cartel violence, and maintaining stability amid Morena’s political dominance. A scientist, she pledges to continue López Obrador’s policies, balancing continuity with a more analytical, less polarizing leadership style. (Washington Post)

?? Mexico's Maritime Trade: Navigating Growth Amidst Infrastructure Challenges

Mexico's container traffic surged by 14% due to robust imports from Asia, with projections of 8 million TEUs by 2024. While Mexico's industrial sector thrives, port infrastructure struggles with capacity issues. Nearshoring and legal certainty are crucial for attracting foreign investment as the country adapts to shifting global trade dynamics.(Forbes)

?? Wall Street's Blockchain Evolution: New Frontiers in Finance

DTCC's Project Ion aimed to transform stock trade settlements with blockchain but was discontinued. Now, DTCC is pivoting to explore blockchain in collateral management, spurred by CFTC Commissioner Caroline Pham's belief in tokenized collateral as a potential game-changer. This reflects Wall Street's ongoing quest for effective blockchain applications in finance.(The Information)

?? Historic Leadership: Regina García Becomes First Female Head of Mexican Banking Association

Regina García Cuéllar has made history as the first woman to lead the Asociación de Bancos de México (ABM) in its 96-year existence. With extensive experience across multiple sectors and advanced degrees from ITAM and Harvard, her appointment marks a significant milestone for gender representation in the banking industry.(El CEO)

?? Banxico Cuts Interest Rate Again: A Shift Towards Economic Stability

Banco de México has lowered its benchmark interest rate to 10.50%, marking a total decrease of 75 basis points since March. This decision reflects concerns over weakened economic activity and a more favorable inflation outlook. Analysts suggest this may signal a trend towards rate normalization. Upcoming monetary policy meetings are set for November and December. (El Economista)

??? Andrés Manuel López Obrador: A Legacy of Resistance

Discover the pivotal moment in 1996 when a young Andrés Manuel López Obrador led a fierce protest against Pemex's privatization, showcasing his resilience and leadership. This event not only marked his rise as a significant leftist figure in Mexico but also exemplified the struggles of the Chontal Indigenous people.(El Pais)

?? South Korea's semiconductor stockpiles have plummeted 42.6% in August, the steepest drop since 2009, indicating robust demand for AI memory chips.

Production and shipments rose by 10.3% and 16.1%, respectively, suggesting that the chip sector, crucial for the economy, continues to thrive despite a slowdown in export growth. (Bloomberg)

?? Raspberry Pi Launches Affordable AI Camera Module for Smart Applications Raspberry Pi introduces a $70 AI Camera Module equipped with a Sony IMX500 sensor and RP2040 chip, enabling real-time object detection. Ideal for industrial uses like smart city sensors, this module processes images independently, freeing the Raspberry Pi for other tasks. Reliable production ensures availability until January 2028. (Raspberry Pi)

?? SoftBank's $500 Million Bet on OpenAI Amid Leadership Shifts

SoftBank's Vision Fund is set to invest $500 million in OpenAI as part of a $6.5 billion funding round, elevating OpenAI's valuation to $150 billion. This comes as the company faces leadership changes, including the exit of its CTO, and considers a shift to a for-profit model.(Bloomberg)

?? Governor Newsom Rejects AI Safety Bill Amid Controversy

California Governor Gavin Newsom has vetoed SB 1047, an AI safety bill that faced opposition from major tech firms but garnered support from scientists. Citing its limited scope, Newsom is collaborating with experts to craft more inclusive legislation. This decision fuels ongoing discussions about AI regulation and public safety, even as other AI bills are enacted. (Wall Street Journal)

?? DP World Pursues Strategic Trade Hub in Mexico

DP World is in discussions with the Mexican government to establish a trade hub aimed at facilitating cargo transport to the U.S. The port operator seeks a site for an industrial park, reminiscent of its successful Jebel Ali port in Dubai, as it aims to enhance its presence in North American trade. (Wall Street Journal)

In-depth with Nido: What we are thinking

If you’ve been following the news about Mexico, then odds are you encountered two great topics. On the one hand, the start of Claudia Sheinbaum’s tenure as Mexican president—the first woman to ever hold the position. A theme that has been submerged with great debate as to whether Sheinbaum—a former academic with a PhD in renewable energy—will make her own path in the nation’s chief executive or will follow on a path set forth by her party, Morena (more on Politico). On the other, and quite conversely, the country has been engulfed by a series of reforms pushed by current President Andrés Manuel López Obrador in his last month in office. Chief amongst them, an ambitious reform to Mexico’s justice system (more on the New York Times).

Much like that, the nation is now suspended between the last acts of President López Obrador, and a broad uncertainty as to Sheinbaum’s first steps.

At ConteNido, we’ve already covered Sheinbaum’s triumph and cabinet picks extensively (read more at ConteNido). So this week, we wanted to cover the other topic that has engulfed mexican media for months. Namely, President López Obrador’s reforms. And, more specifically, the one reform that is on top of everybody’s mind: the rise of Mexico’s new judiciary system. Most importantly, understanding its potential impact to Mexico beyond speculation and doom calling.

Let’s start with the basics. What 's going on?

During the last stretch of his Presidency, Andrés Manuel López Obrador found himself in an odd scenario. Due to a change in electoral calendars, the current president had a one month overlap with the nation’s new Congress—a Congress in which his party, Morena, had gained an ample majority (more on CNN). In that period, he decided to use that power to reform the nation’s justice system—which, quite likely, has been the greatest source of tension for his administration.

Why the judiciary? Well, in great part because it is the culmination of multiple long held battles (some ideological, some more pragmatic). For years, President López Obrador has engaged in a series of attempts to reform Mexico’s judicial system, mostly in an effort to eliminate “privileges” held by the nation's Supreme Court. Arguably the first tension came when the López Obrador administration tried to cap the salaries of all public servants to be below that of the president—a decision the Supreme Court opposed and was able to avoid in the aftermath of reform (more on El Financiero). Throughout his administration, President López Obrador encountered great pushback from Mexico’s Supreme Court when attempting to reform mining regulation and the country’s non-partisan electoral authority (more on El Universal and El País). All these tensions culminated in the surprising removal of federal budget assigned to the Supreme Court and the first signs of the reforms to come (more on El País).

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