Presidential candidate Claudia Sheinbaum of the “Sigamos Haciendo Historia” coalition waves to supporters during the 2024 closing campaign event at the Zocalo on May 29, 2024 in Mexico City, Mexico.
Hector Vivas Getty Images News | Getty Images
Mexican leftist climate scientist Claudia Sheinbaum has won enough votes to become the Latin American country’s first female president.
The country’s electoral institution released a flash count estimate on Sunday, saying Sheinbaum won the presidential election. The estimate has a margin of error of +/- 1.5%, the agency said.
A protégé of longtime ally and mentor Andrés Manuel López Obrador, Sheinbaum is now poised to succeed AMLO when his six-year term as president ends on October 1.
In a speech after the preliminary results, Sheinbaum said that the government will have “republican austerity, financial and fiscal discipline and autonomy,” according to a CNBC translation, adding that the country “will not have an authoritarian or oppressive government.”
“We will maintain the necessary division between economic power and political power. We will always defend and will work for the main interests of the Mexican people and the nation,” he said.
Sheinbaum also sketches Mexico’s relationship with the United States under its stewardship. “With the United States, there will be relations of friendship, mutual respect and equality, as has happened until now. And we will always defend the Mexicans who find themselves on the other side,” he said.
The US dollar is very low against the Mexican peso around 1 am local time.
Current President Lopez Obrador congratulated Sheinbaum for becoming the country’s first female prime minister in 200 years in a video address translated by CNBC: “The name of Mexico is brought back to the heights. It’s proud to be Mexican.”
Sheinbaum, a former Mexico City mayor dubbed the “ice woman” by her political rivals, has vowed to continue AMLO’s policies and win support from the ruling Morena party.
A public view of Mexico’s presidential candidate for the ruling Morena party, Claudia Sheinbaum, closes a campaign rally, in the Zocalo square in Mexico City on May 29, 2024.
Pedro Pardo Afp | Getty Images
After dominating the polls for months, Sheinbaum defeated her electoral rival, center-right businesswoman Xóchitl Gálvez, in a landmark vote.
Galvez acknowledged the provisional results in a speech after his release, saying he had communicated with Sheinbaum to admit defeat.
“I accept the result because I love Mexico, and I know that if everything goes well for the government, it will be good for our country,” he said according to a CNBC translation, describing the election as “historic,” but also calling out it was “the most violent” in the country’s history. Thirty-seven candidates were killed during the election process, according to Reuters.
“My admission (of defeat) is accompanied by a strong call for results and solutions to the country’s grave problems,” Galvez said, asking the audience to “consider me a fighter, who will not stop fighting for Mexico where life, truth and freedom are respected.”
Economic challenges
Sheinbaum takes charge of Mexico, which is still undergoing an economic recovery after a severe downturn during the Covid-19 pandemic. The country is shedding 8.5% of its annual GDP in 2020 – the biggest contraction since the 1930s, according to Reuters.
The World Bank says that, over the last three decades, the country has “underperformed in terms of growth, inclusion, and poverty reduction compared to similar countries.”
In a release at the end of May, Deloitte Senior Economist Marcos Novelo highlighted the sharp economic downturn led by Covid and the country’s slow recovery, relative to other major economies.
“We suspect that, after a shock like the pandemic, there are still some distortions in Mexico’s economic data, which creates the illusion that the recovery is more dynamic today than compared to the past,” he wrote.
The International Monetary Fund expects the Latin American country of more than 132 million people to record GDP growth of 2.4% this year, compared to an expansion of 3.2% in 2023.
Analysts say Mexico’s next government will face significant fiscal and structural realities, requiring tough choices when balancing investment plans, popular – but expensive – welfare programs, and most importantly, Pemex. State-owned oil companies have been struggling amid rising debt levels and lower-than-expected oil production.
Claudia Sheinbaum, presidential candidate of the ruling MORENA party, reacts while speaking to supporters after winning the election, in Mexico City, Mexico June 3, 2024.
Raquel Cunha Reuters
“Without a concrete solution to the elephant in the room – Pemex – neither external market sentiment nor credit rating agencies are convinced of Sheinbaum’s fiscal credentials,” said analysts at Verisk Maplecroft in a new research note.
“His main proposal – to kick the can by repaying Pemex’s upcoming debt obligations (USD 6.8 billion in 2025, followed by USD 10.5 billion in 2026 – and a total of $ 39 billion by the end of the decade) – is impossible. to wash with investors, because of Pemex’s deep structural problems,” he added.
Sheinbaum previously worked as a contributing author to a report from the United Nations Intergovernmental Panel on Climate Change. However, the 61-year-old did not make the climate threat facing Mexico a central part of her campaign.
