Mexicans up in arms

Mexicans up in armsStage protests over petrol price hike Protests in 10 states are the latest headache for Mexican President Enrique Pena Nieto. Mexicans angry over a steep hike in petrol prices blocked roads around the country on Monday, but the government refused to budge on the energy reform behind the increase.

The business federation Coparmex also weighed in, calling the increase inflationary and bad for consumers.

Police said protesters blocked roads in around 10 states and that in some cases officers clashed with demonstrators.

President Enrique Pena Nieto's government announced last week that the price of petrol would increase by as much as 20 percent to 0.88 dollars per litre while diesel would rise by 16.5% to 0.83 dollars. The increases took effect on New Year's Day. Pena Nieto has promised that fuel prices will eventually fall thanks to a landmark 2014 energy reform he instituted, which ended a seven-decade-old monopoly held by the state-run firm Pemex.

The government plans to end subsidies and let the market dictate prices in March. But Mexicans will feel the pinch at the pump before they start falling.

Deputy treasury secretary Miguel Messmacher said Monday the new price increases would stay in place, saying prices were already artificially low in Mexico. He acknowledged people were angry.

“These things always cause concern. That is understandable,” he said. “We are aware this is an unpopular measure.”

The protests are the latest headache for Pena Nieto.

His popularity has plummeted below 25% this year due to his government's failure to curb drug-related violence, disappointing economic growth and his unpopular decision to host Donald Trump before the anti-immigration Republican won the US presidential election.

The fall in global oil prices in recent years has forced the government to cut its budget and slash spending at Pemex.

And the peso has fallen to historic lows due to Trump's protectionist rhetoric against Mexico.

The liberalisation of petrol prices was supposed to begin in 2018, but the government decided to start it now.

NAMPA/AFP