Mexico’s Finance Minister Carlos Urzúa has resigned, accusing the country’s president of basing economic policies on “extreme” (leftist) ideology.
Urzúa’s resignation deepens the fear that Mexico’s left-leaning President López Obrador, known commonly as AMLO, may follow in the footsteps of former Venezuelan president Hugo Chavez, whose economic measures have left the South American country in an unprecedented economic chaos.
AMLO quickly accepted the resignation, replacing Urzua with Arturo Herrera Gutiérrez, an official who previously served as assistant secretary in the Finance Secretariat. The president defended his economic plans, saying “we cannot put new wine in old bottles.”
In his resignation letter, Urzua says he had no option but to resign as AMLO’s close aides had taken control of his ministry and were influencing his policy decisions.
They “don’t have any knowledge of public finance” and advocated for policy decisions based on political ideology rather than sound economics, Urzua said with reference to AMLO’s aides.
AMLO’s economic policies have already scared investors. Soon after taking oath of office, he scrapped plans for an already partially-built new airport in Mexico City and vowed to auction off a presidential plane in order to save money.
He announced cash transfers to the elderly and stopped funding a few government agencies, saying they were wasting tax-payers’ money.
AMLO’s Morena party has long been advocating for cutting bank fees and using central bank reserves for funding infrastructure projects. Urzua opposed all such socialistic measures.
US ratings agency Moody’s has called Mexico’s policymaking as “unpredictable”, and some investment banks are suspecting that the economy could already be in recession, according to Reuters.