Issue 148-July-Aug 2020

November 11, 2020
The Repercussions of U.S. Elections in Mexico

300 Palabras

By Mario Melgar Adalid

The results of the November 2020 U.S. elections will be historic and have a global impact, including significant repercussions in Mexico. In Mexico, analysts are speculating as to which U.S. presidential candidate will be best for Mexico. President Trump’s supporters highlight factors which, according to their calculations, would tip the balance in favor of the Republican incumbent, most notably the amicable personal relationship he enjoys with his Mexican counterpart, President Andrés Manuel López Obrador. The joint participation of the United States and Mexican presidents in the USMCA is an important factor to consider, as some believe that Democrats do not support the business solutions that were agreed upon by and among the three countries. Although it may seem trivial to … read more

November 11, 2020

Political Thermometer

Mexico’s federal system is largely modeled after the federal framework adopted by the United States of America. The central idea is that the federal government coexists with the state governments, which acting together comprise a balanced political structure. Each government has powers that are granted by a general constitution that establishes the rules for the distribution of power, jurisdiction and obligations. For a variety of reasons, discrepancies naturally arise between state and federal governments. When these disputes cannot be resolved through political dialogue, it is the task of the federal Supreme Court to resolve them. Not all Mexican state governments are currently aligned with the same political party. In what could be considered an historic development, not even the political … read more

Economic Indicators

On August 31, 2020, updated financial indicators reflected:

Peso/Dollar Exchange Rate: $21.8602 pesos per Dollar.

Mexican Stock Exchange: The Mexican Stock Exchange (BMV) closed 36,840.73 points.

Interest Rates: The Average Interbank Rate (TIIE) for a 28-day period was at 4.7690%

Reductions in Estimated Income Tax Payments in Mexico
By Miriam Name and Esteban Gómez Aguado

The COVID-19 pandemic is causing a steep drop in revenues for Mexican companies during fiscal year 2020, which will also result in decreased net income and, in many cases, negative cash balances. Mexican companies will need to keep a close eye on their cash flow and analyze strategies and options to improve their cash balances. One strategy that should be considered involves a reduction of estimated income tax payments, paid on a monthly basis to cover the total annual income tax incurred. The estimated income tax payments for 2020 are being calculated based on an amount of net income that is potentially too high, compared to the likely net income that will actually be received this fiscal year. Article 14 … read more

Compliance with Guidelines for Reopening Operations and for Temporary Remote Work
By Pablo Sáenz and Fernanda Magallanes

As a result of the COVID-19 pandemic, Mexican companies that i) are deemed essential, ii) are deemed to be non-essential but are and currently undergoing a reopening process, and iii) those that due to the nature of their work have employees working remotely, must implement and maintain specific written protocols and policies in accordance with federal and local guidelines requiring numerous measures to be taken to ensure a safe return to work, and if applicable, to regulate temporary remote work. In addition to maintaining appropriate protocols and policies, companies must also maintain certain documentation such as logbooks, questionnaires, records of the delivery of personal protective equipment, signage, communications, and training records, among others. In the event of a workplace inspection, … read more