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AMLO's losing super-majority in the lower house, Mexico City not longer a stronghold

Fernando Llano/AP

Mexico's Ruling party sees support in Mexico City fall: Mayor Claudia Sheinbaum of Mexico City who governs for Morena, a leading contender to succeed AMLO said “In recent months there was a very powerful smear campaign against the [Morena] movement, which had an impact on [some] sectors of the population.”
- Mexico News Daily.

- Morena seen taking several states, hurt in capital stronghold
- Mexico City results reflect national socioeconomic divides

By Max de Haldevang and Justin Villamil/Bloomberg

Petroleumworld 06 08 2021

Mexican President Andres Manuel Lopez Obrador's coalition is on course to lose its super-majority in the lower house after midterm elections, dealing a blow to his chances of passing constitutional reforms to further his nationalist agenda.

The president's Morena party and allies will hold between 265 and 292 seats in the 500-person chamber -- far short of their current two-thirds majority, according to a partial tally of Sunday's voting by the country's electoral institute. The ruling coalition is on track to hold at least nine governor seats of the 15 up for grabs.

The peso led gains among emerging-market currencies as it became increasingly likely that AMLO, as the president is widely known, will encounter stronger checks on his legislative power. Mexico's benchmark dollar bonds held little changed.

While the president was not on the ballot, the drop in support for his party suggests that his star may be waning three years after winning a landslide. With Mexico hit by one of the highest death tolls from the pandemic, opinion polls showing AMLO's failure to curb corruption and the appalling bloodshed across the country, Morena went into the vote in a more fragile position. The elections ended up being one of the most violent in Mexican history.

“The markets will take it positively that Morena and its allies have lost the super-majority,” said Benito Berber, chief Latin America economist at Natixis in New York. “AMLO is less strong than he was three years ago, but he's still very strong.”

Yet the president sought to frame the election results as a win for his agenda, and called the vote “free” and “clean.”

“I'm very grateful because as a result of this election, the parties that sympathize with the transformation project that is underway will have a majority in the lower house,” he told reporters Monday morning. “You can imagine how I am, happy, happy, happy.”

The smaller majority will make it significantly harder for Lopez Obrador to achieve his goal of passing sweeping legislative changes, most notably to Mexico's key energy sector. After enjoying hefty majorities in both chambers of congress since taking office in late 2018, AMLO will now have to deal with a stronger opposition as he tries to deliver his ambitious reform of Mexico, which he calls a “fourth transformation.”

“The results are a big setback for Morena and the president in the sense that they will have to negotiate going forward,” said Veronica Ortiz, a political analyst in Mexico City, who forecasts that Lopez Obrador will become more radical and attempt to rule by decree and referendum. “He really doesn't have the disposition of a negotiator.”

Of the 300 seats in congress up for direct election, Morena and allies are currently winning 184 to the opposition alliance's 109 as of 10:15 a.m. in New York. The remaining 200 seats are decided by proportional representation. The ruling alliance is expected to take home between 34.9% and 35.8% of the vote, down from the 37.3% it won in 2018, according to the electoral authority.

The results will also force the president to rely more on the ruling coalition, particularly the Green Party and the Labor Party, to move forward his ambitious agenda.

“The Green Party and the Labor Party are going to charge AMLO dearly for their support,” said Natixis' Berber. On the other hand, victories in the gubernatorial races indicate that Morena remains in a very strong position ahead of the nation's 2024 presidential election, he added.

Murders, Attacks

The election was blighted by violence, with dozens of candidates murdered, kidnapped or attacked. On top of the lower house and the 15 state governorships, hundreds of city halls and local legislatures were up for grabs. Turnout was between 51.7% and 52.5%, the electoral authority said on Sunday night.

Other headwinds that may have resulted in the president's wings being clipped include his regular outbursts at the media and “elites:” While they play well with his base in the poorer south, they risk alienating the key strata of more educated voters who backed him three years ago in a revolt against the established parties' failure to tackle corruption. A deadly metro accident in Mexico City also damaged his government in a core stronghold, resulting in the loss of several districts in the capital on Sunday.

The outcome “puts the brakes on the president's project to transform the country, at least on constitutional matters,” said Javier Martin Reyes, a political scientist at research center CIDE in Mexico City. “The risk is that Lopez Obrador keeps betting on decrees and laws that are probably unconstitutional, generating more tension, making the judicial power more important.”


By Max de Haldevang and Justin Villamil from Bloomberg.
06 07 2021



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