Flip-flop, Mexican-style: Leftist now pro-business
Andres Manuel Lopez Obrador, opposed by Mexico's business community in 2006 when he narrowly lost the presidential election, now is embracing the investor-friendly policies of Brazil.
MEXICO CITY — Andres Manuel Lopez Obrador was opposed by Mexico's business community in 2006 when he lost the presidential election by less than a percentage point. He's trying to claw his way back into contention in this year's race by wooing his old critics.
Out are campaign slogans such as "for the good of Mexico, the poor come first," and in are pledges to balance the budget and protect the central bank's independence. To protest his defeat six years ago, the candidate blockaded Mexico City's largest business boulevard for weeks, but now he says he wants to emulate Brazil's investor-friendly former President Luiz Inácio Lula da Silva.
The strategy is having some success, especially among business leaders in the northern industrial belt hardest hit by drug violence, which has cost 47,000 lives since current President Felipe Calderón declared war on the drug gangs.
"He's realized that you can't fix the world with socialism," said Alejandro Gurza, a Ford dealer in the border state of Coahuila and a former vice president of Mexico's car-dealership association. "Businessmen were afraid he would expropriate their property. We realize he's changed."
The campaign is taking place as Latin America's biggest economy after Brazil is showing resilience amid a global slowdown. Mexico's gross domestic product expanded about 4 percent last year, and the government expects growth this year to reach 3.3 percent. Lopez Obrador charged fraud in 2006 when he lost to Calderón after leading in most polls earlier that year. Now, less than six months before the July 1 vote, he trails Enrique Pena Nieto of the Institutional Revolutionary Party, or PRI, by 29 percentage points in the latest Consulta Mitofsky poll.
The former mayor of Mexico City, who heads a coalition including the Party of the Democratic Revolution, was backed by 16 percent of those surveyed Nov. 21-27 by the Mexico City-based pollster. Pena Nieto was backed by 45 percent while Josefina Vazquez Mota of the ruling National Action Party had 20 percent. The poll surveyed 1,000 people and had a margin of error of plus or minus 3.1 percentage points.
"There will be security for all who invest," the 58-year-old Lopez Obrador said in a brief interview at a Dec. 22 rally in Mexico City. He has declined repeated requests for a more extensive interview.
While Pena Nieto is the candidate to beat, his lead isn't insurmountable, Enrique Krauze, a Mexican historian and publisher, said in an interview from Mexico City.
Pena Nieto, 45, the former governor of Mexico state, must convince voters that he represents a break from the populism and corruption that tainted his party during seven decades of uninterrupted rule until 2000, said Gabriel Casillas, chief economist at JPMorgan Chase in Mexico City.
In early campaigning, Pena Nieto has provided ammunition to critics such as novelist Carlos Fuentes, who said his "ignorance" made him unfit to run the country.
On Dec. 3, he struggled when asked by journalists at a literary fair to name three books that influenced him, finally identifying the Bible and attributing to Krauze a title written by Fuentes.
A week later, in an interview with the Spanish newspaper El País, he didn't know the price of tortillas and justified his lack of knowledge by saying he isn't "the woman of the household." He later said that he was referring to his "family context" and that the remarks shouldn't be taken as an attack on women.
Vazquez Mota, 50, may also climb to challenge Pena Nieto's lead if Mexico's economy continues to weather the European debt crisis and uncertainty over the strength of growth in the U.S., which buys 80 percent of Mexico's exports.
"Doubling the rate of growth, which we are proposing now, would permit us, if not to totally satisfy the demand for jobs in the formal employment market, then to get much closer to it," Mota said in a Dec. 29 interview in Mexico City.
Since October, Lopez Obrador, popularly known by his initials as AMLO, has met with hundreds of businessmen, swearing not to "take from the rich" and vowing to convert Mexico into a "loving republic." Among his supporters is Alfonso Romo Garza, the controlling shareholder of Monterrey-based brokerage Vector Casa de Bolsa and a board member of Gruma, the world's largest producer of corn and wheat tortillas.
"AMLO for me was an ogre" in 2006, Romo Garza said at a gathering of business leaders in Monterrey on Oct. 5. "I was intolerant."
Lopez Obrador's pledge to crack down on telecom and other monopolies won over Fernando Turner Davila, chief executive officer of Monterrey-based Katcon Global SA, a catalytic-converter producer with facilities in seven countries.
In 2006, the candidate "failed to approach the middle class and businessmen," Turner said by phone on Dec. 21. "He's corrected that now."
On Nov. 16, Lopez Obrador told local radio station Noticias MVS that he'd like to be the Mexican Lula, while saying each leader has their own characteristics. In two terms as Brazil's president, the former union leader helped lift 21 million people out of poverty while winning Brazil its first-ever investment-grade credit rating, thanks to policies that reduced inflation by half.
"Lopez Obrador's more moderate discourse definitely makes him a strong candidate," Casillas said in a telephone interview. Still, the election outcome will depend greatly on who Calderón's National Action Party nominates in a Feb. 5 primary, he said.
Critic of drug war
Many of Lopez Obrador's newfound business supporters are from the northern states, where the majority of deaths blamed on drug violence over the past six years have taken place. Like his rivals, he's criticized Calderón's deployment of the army to tackle the drug cartels, saying he'd pull troops off the streets and address the underlying causes of the violence, such as Mexico's poor education system.
Lopez Obrador was a leading opponent of Calderón's proposal to open up state-run Petroleos Mexicanos to more private investment, a move that economists say is needed to revive the country's oil industry. Output at Pemex slid 21 percent from 2006 to 2010 as crude production slowed at maturing oil fields. Third-quarter losses at the company widened to 81 billion pesos from 2.8 billion a year earlier.
If elected, Lopez Obrador says he'd reduce government purchases from foreign electricity companies because they charge high prices, according to a campaign video. He also called in a video posted to YouTube Oct. 17, 2010, for the "rescue" of Mexico's mineral wealth that he says was illegally given to mining companies between 1988 and 2006.
Foreign miners with operations in Mexico include Canadian companies Capstone Mining and Agnico-Eagle Mines, while Arlington, Va.-based AES Corp. and Spain's Iberdrola SA own utilities in the country.
His coalition wants the government to take control of half of the country's 1.54 trillion-peso ($112 billion) pension funds, which are managed by companies such as Citigroup's Banamex unit and BBVA Bancomer SA. Lopez Obrador distanced himself from the proposal in a Dec. 5 video posted on YouTube.
"There will be many people who will believe in Lopez Obrador," said Krauze, the historian and publisher, who coined the term "Tropical Messiah" to describe the candidate in a 2006 essay. "He is no longer on the attack; he's meeting with businessmen. But I think his concrete ideas haven't changed."