Mexico’s AMLO Says Banxico Autonomy Fears From Bill Overblown

Mexican President Andres Manuel Lopez Obrador said it was an “exaggeration” to suggest the central bank’s autonomy could be affected by a controversial bill that will force the institution to buy dollars.

Voting on the proposal, which the central bank known as Banxico says could force it to take money from illicit origins including drug trafficking, was postponed until February on Tuesday after fierce opposition from policy makers and the private sector. While Lopez Obrador said he agreed with the decision by congressional leaders to delay the bill, he also said that fears of its impact on Banxico are overblown.

“Sometimes people exaggerate through ignorance, they talk for example about affecting the Bank of Mexico’s autonomy and that seems to me an exaggeration,” the president said at a daily press conference on Wednesday. “Of course we need to respect the Bank of Mexico’s autonomy but without exaggerating.”

The bill’s backers say it would help Mexican migrants get dollars into the banking system, but Banxico argues only 1% of remittances sent home from workers living abroad is in cash. Leaders in congress said they would form a joint-work group to iron out problems with the bill in January after its passage by the Mexican senate last week led to pushback by Banxico and the country’s top private banks.

AMLO, as the president is known, said the postponement will provide time to gather opinions on the bill and make sure the public doesn’t have a warped understanding of it.

Passing the legislation in its current form may hurt Mexico’s standing against illegally gotten money, IMF Managing Director Kristalina Georgieva said separately.

“By solving a small problem, a bigger problem could be created and put at risk, whether real or perceived, Mexico’s reputation in its efforts to fight money laundering, as well as undermining the central bank’s reputation,” she said in an interview published Wednesday with Excelsior newspaper and two other publications.

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