The News
Mexico will pause relations with the US and Canadian embassies, President Andrés Manuel López Obrador said, after their ambassadors criticized a controversial plan to overhaul the country’s judiciary.
The Mexican leader said the rupture did not mark a suspension of overall relations between the key trading partners. It came after the US ambassador took the unusual step of openly criticizing a Mexican domestic policy, saying the proposed judicial overhaul posed a risk for democracy, while the Canadian ambassador relayed concerns from investors.
“Hopefully there will be a statement from [the US] that they are going to be respectful of the independence of Mexico,” AMLO said Tuesday.
Under the overhaul proposal, all judges, including those in the Supreme Court, would be laid off and reelected by popular vote, which experts fear could lead to the country’s powerful drug cartels imposing their agents on the courts.
SIGNALS
Overhaul could put North American trade at risk
The proposed layoff of judges and their subsequent direct reelection could make it impossible for Mexico to comply with its international obligations under a key treaty between Mexico, the United States and Canada, particularly around labor disputes, a Mexican judge told The Hill. The primary fear internationally is that bad actors could weaponize the situation to bribe or threaten judges into carrying out their bidding, and that the politicization of courts would jeopardize impartiality. Another part of the overhaul, which aims to dissolve some autonomous regulatory agencies, “poses a significant risk” to the multilateral trade agreement, Agence France-Presse reported a political risk analysis firm as saying, because it wouldn’t respect clauses in the deal that aim to prevent state interference.
AMLO retains popular support, but judicial changes could be overreach
Despite widespread criticism of the proposed judicial overhaul, the outgoing president still has the support of the electorate, confirmed by the June election victory of his de facto successor, Claudia Sheinbaum — a “clear mandate of continuity,” a columnist argued in El País. However, his handling of the judicial overhaul could be overreach — the ruling party has taken the “questionable” approach of translating its renewed strength “into a strict imposition of AMLO’s wishes.” The process of imposing the changes on the judiciary has been marred by tensions, as protests erupted against the proposal, while federal court employees and judges remain on strike.
Impact of judicial changes may be overstated
From an economic perspective, the short- and medium-term impact of the proposed judicial reform may have been overestimated, the Latin America Risk Report newsletter argued. Other positive factors, such as the trend for the US to move production facilities from Asia to Mexico so that they’re closer — known as “nearshoring” — may end up having a bigger impact than the negatives. And President-elect Sheinbaum may take a “more productive” approach once in power, one that could help the Mexican economy improve. However, the long-term business implications of moving to directly elect judges are hard to predict, however, the newsletter concluded.