From special interests and political corruption to persisting security issues and weak institutions, managing reform in Mexico’s fragile democracy will be a true test of President Pena Nieto’s leadership and his historic coalition.

These themes are analysed in Elizondo's forthcoming paper Achieving Reform: The political economy of the Pacto por México.

When Peña Nieto won the presidency in December 2012 with only 38 per cent of the vote, it seemed he would follow the same ineffective path of his predecessors. However, shortly after his inauguration President Nieto unveiled the Pacto por México, an agreement with the two major opposition parties, the PAN and the PRD, which put forth 95 points for major reform. This was done not in the middle of an economic crisis, but as a reaction to mediocre growth.

According to Elizondo, there are three reasons that explain why this was possible. First, a growing consensus among the Mexican political and business elite that structural reform was the best path to increased growth and overall prosperity. Second, the internal political dynamics in the two major opposition parties made collaboration possible. In fact, it was the PRD leadership that first suggested the idea of a national pact. Third, the government offered financial incentives to legislators of all political parties to secure their support—a sort of “legalised” corruption. This mechanism was made politically feasible by the very complacent media.

This discussion was the third in a series of case studies on 'Building Coalitions for Reform'. The series, organised by the Legatum Institute, the National Endowment for Democracy’s International Forum for Democratic Studies, and World Affairs, explores the politics of economic reform in developing democracies.

About the Speakers

Carlos Elizondo Mayer-Serra is a professor and researcher at Centro de Investigación y Docencia Económicas (CIDE) in Mexico City. He is currently on sabbatical at the Graduate School of Public Administration and Public Policy at the Tec de Monterrey. Previously, Carlos served as Ambassador and Permanent Representative of Mexico to the OECD. He is a national researcher of the Mexican National System of Researchers and writes a weekly column for Excelsior. He has authored several books, most recently Con dinero y sin dinero... Nuestro ineficaz, precario e injusto equilibrio fiscal (Random House Mexico, 2012). Recently, he was appointed as an independent member of the Board of Directors at Pemex. Carlos received his Ph.D. and M. Phil. in Political Science from the University of Oxford in 1994.

Christian Caryl is a Senior Fellow at the Legatum Institute and the editor of Democracy Lab, a website co-published with Foreign Policy magazine that follows political transitions from around the world. Previously, Christian worked as Washington bureau chief for Radio Free Europe/Radio Liberty. From 2000 to 2009 he was a foreign correspondent for Newsweek, running the bureaus in Moscow and Tokyo. He has reported from some 50 countries and his assignments have ranged from Japanese cuisine to the wars in Afghanistan and Iraq. His first journalistic assignment was covering the collapse of communist East Germany and the fall of the Berlin Wall. He is the author of the book Strange Rebels: 1979 and the Birth of the 21st Century (Basic Books) which was shortlisted for the 2013 Cundill Prize in Historical Literature.

Christopher Walker is Executive Director of the National Endowment for Democracy’s International Forum for Democratic Studies, a leading center for the analysis and discussion of the theory and practice of democratic development. His articles have appeared in publications including the Wall Street Journal, the New York Times, the Washington Post, Foreign, Barron’s, The Far Eastern Economic Review, Frankfurter Allgemeine Zeitung, the Journal of Democracy, and World Affairs.