Except for Mexico, most countries are walking away from nationalized consumer companies


López Obrador has relied almost exclusively on state-owned companies of the kind that dominated Mexico’s economy in the 1970s, most of which were sold off by his predecessors.

Some he has recently created, like the government mining company he gave a monopoly over lithium deposits to hoping to jump on the U.S. electric car boom, touting its reserves of the key battery component. But the company has no experience in producing or refining lithium and hasn’t yet turned a shovelful of dirt.

The president also wants to revive some state companies, like a small government-owned bank for which he envisions building thousands of branch offices, and Mexicana, the defunct state-owned airline. Elsewhere, countries are walking away from such nationalized consumer companies.

Perhaps less controversial is López Obrador’s “internet for all” program. While Mexico’s private and foreign telecoms already offer coverage on about 85% of Mexico’s territory, Mexico’s poorest citizens live in communities so small or remote that it is not profitable to serve them.

López Obrador entrusted the task to the state-owned electrical utility, which has no experience in the field, and a small, cash-strapped telecom firm that the government bailed out and took over.

Gerardo Flores Ramirez of the Mexican think tank Telecommunications Law Institute notes that despite spending almost $900 million from 2020 to 2023, the government system has coverage of only about 70% of the country, and won’t reach even modest, reduced goals of 92% until 2028.

“They are not going to meet the goals,” concluded Flores Ramirez.

Source: OEM

Mexico Daily Post