As protests against a judicial reform led by incoming president Andres Manuel Lopez Obrador gained momentum, the peso fell over 2 %, and judges and magistrates on Wednesday resorted to a strike.
Lopez Obrador has a top priority over the controversial reform, which would allow judges to be elected by popular vote, including justices of the Supreme Court, who claims it will help fight corruption and violence.
However, the decision Morena party has sucked up the industry since claiming yet larger numbers of Congressional chairs than initially anticipated in a June federal election, properly guaranteeing them the ability to pass constitutional amendments when the fresh Congress takes office next month.
” We are heading towards an extraordinary constitutional crisis, a turmoil that, if not stopped, may leave deep wrinkles in our cultural fabric”, Juana Fuentes, chairman of the union that brings together judges and courts, said on Wednesday.
Fuentes claimed that the strike would continue until the proposal was abandoned, but that the judiciary would still be able to handle urgent cases.
Opponents of the reform claim that the judges ‘ popular vote would end merit-based career paths and make the judiciary even more vulnerable to influence from outsiders, such as those from political parties or even organized crime organizations.
Markets are worried the changes would erode key checks and balances on presidential power, damage the business climate in Latin America’s second-largest economy, and lead to trade disputes under the North American trade agreement, USMCA.
The initial election of judges would be squeshed into two parts under an altered proposal, which appears to have failed to calm concerns.
On Tuesday, investment bank Morgan Stanley downgraded Mexico to “underweight”- an effective sell recommendation- saying the proposed judicial reform” should increase risk” and could hit investment. ” That’s a problem as nearshoring is reaching key bottlenecks”, the bank said in a note.
In afternoon trading, the Mexican peso fell more than 2 %, and the stock market fell 0.6 %.
Lopez Obrador criticized the strike and asserted that he would not change his mind about the change.
” Nothing is happening with their movement, it does n’t matter, because they do n’t serve the population”, he said during a regular morning press conference.
