Mexico’s president threatens constitutional change if power bill struck down

RIO DE JANEIRO, BRAZIL – Mexican President Andrés Manuel López Obrador said on Wednesday, March 17th, he would send an initiative to Congress to reform the constitution if a new law to increase state influence over the electricity market is deemed unconstitutional.

Last week, a judge temporarily suspended the government’s electricity bill, which was passed by lawmakers earlier this month and aims to strengthen state power utility the Comisión Federal de Electricidad at the expense of private operators.

Speaking at a regular news conference, the leftist president said he would pursue a change in the constitution if the legislation is ultimately struck down by Mexico’s judiciary.

Read: Mexico’s Top Court Strikes Down Parts of President’s Power Plan

López Obrador argues that the previous administration skewed the electricity market in favor of private operators with its own constitutional overhaul. Earlier this month, he said he is seeking to renegotiate the terms of existing contracts.

Some companies were eager to reach a deal with the government, López Obrador said, without naming any. However, there would need to be “discounts,” he said.

Trade experts say that a repeal of the prior government’s energy reform could breach Mexico’s commitments to investors under the regional trade deal it sealed in 2018, the United States-Mexico-Canada Agreement (USMCA).