Mexican Billionaire Says Health Officials Wrecking Economy
Mexican Billionaire Says Health Officials Are Wrecking Economy
(Bloomberg) -- Mexican billionaire Ricardo Salinas Pliego on Monday called on government health officials to stop imposing “authoritarian” policies to contain the spread of the coronavirus outbreak that the mogul said were damaging the economy.
Salinas Pliego, who owns bank and appliance dealer Grupo Elektra and the country’s second largest TV network TV Azteca, said Mexicans needed to be free to decide what precautions they wanted to take in the face of the virus. He asked health officials to stop making new rules and said shutdowns had caused “enormous damage to our precarious economy.”
“Stop spreading panic and fear with your massive publicity campings,” he wrote in a statement posted on Twitter. In all caps he added: “Let us decide, don’t impose your authoritarian vision.”
Salinas Pliego has been one of the most vocal proponents of keeping the economy open in Mexico despite the virus’s spread. His TV network was warned by the government in April for calling on the public to ignore the nation’s health czar. While the billionaire has attacked the government, President Andres Manuel Lopez Obrador has also shown resistance to shutting down the economy and dragged his feet before calling a health emergency at the end of March.
Mexican officials are now attempting to implement a complex “traffic light” system to gradually open the economy even as new cases and deaths have been hitting record highs. Lopez Obrador has started touring different parts of the country, which has drawn criticism for sending mixed messages to Mexicans. The country has lost more that 1 million formal jobs in the past three months and the economy is seen sinking around 8% this year in its biggest recession since the Great Depression.
Salinas Pliego’s chain of Elektra stores was chastised by the labor minister for remaining open despite government orders, but the company argued its banking services were essential. Even after Lopez Obrador said Elektra stopped selling appliances, a tour of several of its stores by Bloomberg News in May, and a call to its customer service line, found that non-essential products were still on sale.
Before the billionaire tweeted his statement, Lopez Obrador said on Monday morning that his administration hasn’t acted in an authoritarian way, noting that the federal government had not enforced curfews, but instead called on voluntary restrictions.
“We can begin to go out” if we take precautions, the president said. “If we take care of ourselves we can move forward, not stay paralyzed in our homes.”
Mexican retail and bank stocks have been hit hard by shutdowns. Non-performing loans at Elektra’s Banco Azteca bank unit rose to 11% in April compared to 2.89% in the same month last year, according to data released June 8.
Shares have fallen more than 7% after Elektra posted its first quarter results last month - where net income fell 97% due to a bad loan - and it’s still outperformed the S&P/BMV IPC since late February, falling only half the 16% plunge of the general index.
Salinas Pliego said government officials should focus on defending Mexicans from “criminals and vandals.” “They worry us more than the virus,” he wrote. “They are not civilized like most people.”
Murders have continued to rise under Lopez Obrador, who pledged to control gang violence by fighting root causes like poverty, while Mexico City and Guadalajara have seen violent protests over Mexican cases of police brutality in recent weeks.
©2020 Bloomberg L.P.