The country had an eventful political year with a general election held in July 2012. President Felipe Calderón was replaced by Enrique Peña Nieto from the Institutional Revolutionary Party. The election itself was surrounded by controversy, but after a ruling from Mexico’s Federal Electoral Tribunal, Mr Peña Nieto is now the undisputed president elect and takes power on the 1 December 2012. The political uncertainty during the first half of the year had a knock-on effect on shareholder confidence and the number of M&A deals in Mexico fell slightly. We have seen a corresponding drop in the number of M&A lawyers with only 43 practitioners included in this edition, compared to 45 in 2011.
The new proposed mining laws are now hitting the net. Legal and accounting sites are in full discussion as to what the impact will be. Outright exemptions are discussed. I have often talked about the environmental issues of mining in Mexico. I had called most miners with mines in Mexico about nine months ago and did a lot of expanded research and came to the conclusion that my shares in EXK were safe, cough. EXK has released their report on community affairs and it shows strong giving and support to the local communities. EXK continued to drop in share price. I believe that EXK has been offsetting any proposed tax increases with community giving which is stated as rules for tax fairness in the proposed bill. The new president of Mexico is going to get tough about the environment. EXK has received recent awards for keeping a clean and safe environment. So stupid funds need to wait up and realize this.