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Mexico's president-elect aims to avert energy crisis

Staff Writer | July 10, 2018
Mexico's President-elect Andres Manuel Lopez Obrador on Monday said a plan was afoot to avert a crippling energy crisis caused by low oil and gas output.
LatAm   The idea is to invest in infrastructure to rehabilitate refineries
"We are going to rescue (the industry)," Lopez Obrador promised at a press conference following his meeting with members of the Confederation of Industrial Chambers, stressing that "the energy sector is undergoing a severe crisis, especially in crude and gas production."

The idea is to invest in infrastructure to rehabilitate refineries and increase national output with an eye to cutting down on energy imports.

Lopez Obrador, who will take office on Dec. 1, campaigned for rolling back some of the structural reforms implemented by the current administration, including opening up the possibility of private investment in the long nationalized oil industry and liberalizing gasoline prices, which may rise at the pump.

"There is going to be no spike in gasoline prices," Lopez Obrador pledged, adding that the prices will only rise to keep with inflation, at least during the first three years of his six-year term.

The president-elect, 64, has been meeting with corporate and business leaders since his landslide victory in the July 1 election, in a bid to promote public-private sector cooperation for his goal of achieving a 4-percent annual economic growth.

According to Lopez Obrador, corruption in Mexico is the single biggest obstacle to growth as it diverts public funds from infrastructure and other development projects.

Reduction in the income tax and the value-added tax rate in several parts of the country, such as border areas and the southwest Isthmus of Tehuantepec, is too on the way.

To stimulate growth in outlying regions, Lopez Obrador aims to decentralize the government by relocating certain ministries. Secretariat of Tourism, for example, could be moved to Chetumal, home to Mexico's No. 1 resort Cancun.

"It isn't fair or even recommended for public investment or private investment to be concentrated just in certain regions of the country," Lopez Obrador said. "We want the entire country to be able to grow equally."