Claudia Sheinbaum is set to become Mexico’s first female leader in a landslide victory, capitalizing on outgoing President Andres Manuel Lopez Obrador’s popularity while also inheriting rampant criminal violence and a large fiscal deficit left by his government.
The former mayor of the nation’s capital and candidate for the ruling Morena party is projected to receive between 55 per cent and 63 per cent of the votes, according to three exit polls. Xochitl Galvez, representing a coalition of opposition parties that had ruled the country for nearly 90 years, is estimated to obtain between 27 per cent and 33 per cent of the ballots.
The task facing the scientist-turned-politician is daunting. AMLO, as her mentor is known, allowed drug cartels to expand their influence across Latin America’s second-biggest economy, resulting in record murder rates. He also went on a spending spree toward the end of his mandate, writing out welfare checks that made him a hero to the working poor but left the country saddled with the largest fiscal deficit since the 1980s.
The challenge for Sheinbaum, 61, is that she owes AMLO her victory and now needs to tread carefully around his legacy. AMLO has an approval rating of about 60 per cent, meaning he could have easily won the vote if the constitution didn’t bar presidents from seeking reelection.
So while Sheinbaum pledged on the campaign trail to follow his vision, she cannot afford to leave a public security crisis to fester. Mexico’s largest-ever elections were also the deadliest in its modern history.
AMLO Legacy
Amid a weakening economy, she must also find a permanent fix for state-owned Petroleos Mexicanos, the world’s most indebted oil company, which has become a drag on public finances. Rating firms have already warned that no action could cost Mexico its investment grade.
Sheinbaum’s wide lead will give her some room to maneuver. It suggests that Morena and its allied parties are poised for a strong legislative performance, likely maintaining control of both houses of congress and perhaps even obtaining two-thirds of the seats. A supermajority gifts her the power to approve constitutional changes that have eluded AMLO.
Congressional results are expected to take longer to be released.
“Her election will be as much a vote of thanks for what AMLO has done as it is a vote of enthusiasm for Sheinbaum herself,” said Andrew Paxman, a history professor at the Center for Research and Teaching in Economics. “Whether that is enough for her to remain an effective leader remains to be seen, because of this question mark that is her future relationship with congress.”
While winning by a large margin will help Sheinbaum push her agenda through congress, a crucial question persists: Will her government be merely an extension of AMLO’s or will she seek meaningful changes to address Mexico’s most pressing issues?
Prospects of Morena becoming an even stronger political force, coupled with uncertainty about whether Sheinbaum would pursue controversial reforms of the judicial and electoral systems AMLO sought and failed to approve, have worried investors. They would prefer a strong opposition that keeps her in check.
And even if she decides to make changes, it’s uncertain how far she would be able to go. Over his six-year term, AMLO has made profound changes to institutions such as the military, which he turned not only into the most visible security force in the country, but also into a construction behemoth in charge of building and running airports, railroads and other infrastructure projects.
She will also have to consider whether to implement business-friendly reforms and promote investment in energy, water and other infrastructure projects for Mexico to take full advantage of the nearshoring trend that has companies seeking to relocate closer to the large US consumer market.
Super Peso
Under AMLO, the national currency became the best performer in emerging markets. The “super peso” was initially a welcome development because it stimulated domestic consumption of imports. But it has become a burden for the economy, raising production costs of exporters and weakening the purchasing power of remittances that Mexicans receive from relatives abroad.
Some business leaders see signs that Sheinbaum could be friendlier to the private sector, and more open to change the nationalist energy policies implemented by AMLO. That remains to be seen. She has mostly stuck to the basic tenets that made the outgoing leader so popular, promising to expand welfare programs and decrying corruption at all ranks.
Many of Sheinbaum’s policies — from the relationship with China to migration — will also depend on who the next US president will be. Donald Trump’s possible return to the White House may be a complicating factor as it’s not clear whether both leaders would get along.
Domestically, Sheinbaum will also need to keep the ruling coalition united. Morena has left-wing roots but has grown to host members who defected from other parties, becoming an amalgamate with little ideological consistency.
The outgoing president has promised to hand over the reins and retreat to his ranch after leaving office, but whether he’s really ready to leave the spotlight is another question — especially if the ruling coalition starts to fracture.
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