Mexican President Andrés Manuel López Obrador welcomed Tuesday a “new nationalization” of the electricity sector by announcing the purchase of thirteen power plants from the Spanish group Iberdrola. The amount of the transaction reached six billion dollars (5.4 billion francs).
It is a “historic day”, insisted in a video on Twitter the nationalist leftist president, at the origin of a reform of the energy sector to limit foreign participation, which worried his foreign partners. “The Mexican government today signed an agreement to buy thirteen power plants from Iberdrola that will be part of the public patrimony and will be operated by the CFE [commission fédérale d’électricité, ndlr]. It is a new nationalization.”
Today the Government of Mexico signed an agreement to purchase 13 electricity generation plants from Iberdrola that will form part of the public patrimony and will be operated by the CFE. It is a new nationalization. pic.twitter.com/gL38A7tcf9
– Andrés Manuel (@lopezobrador_) 4 avril 2023
The CFE will thus increase from 39 to 55% its share in the total electricity production of the country of 126 million inhabitants, specified the Minister of Finance, Rogelio Ramírez.
Spain in the sights of AMLO
Just a year ago, the Supreme Court validated the reform of the energy sector approved by Parliament to strengthen the share of public companies. This reform threatens billions of foreign private investments and the development of renewables, according to the United States, which does not exclude measures within the framework of the North American free trade agreement.
Another major partner of Mexico, Spain is in the crosshairs of the Mexican president, who has asked for a “break” in the relationship with Madrid. Andrés Manuel López Obrador was very critical of Iberdrola, one of the flagships of the Spanish economy.
“Mexico is not a land of conquest,” he said at the end of May, when the energy regulator imposed a $447 million fine on Iberdrola, a sanction finally suspended by justice. Iberdrola was accused of selling electricity illegally.