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Protests Over Student Deaths Seen Affecting Mexican Economy

  • Reuters

Demonstrators pass by a banner with pictures of the 43 missing students of the Ayotzinapa teacher training college in Tixtla, on the outskirts of Chilpancingo, in the Mexican state of Guerrero, Nov. 13, 2014.

Demonstrators pass by a banner with pictures of the 43 missing students of the Ayotzinapa teacher training college in Tixtla, on the outskirts of Chilpancingo, in the Mexican state of Guerrero, Nov. 13, 2014.

Mexico's finance minister said Thursday that there would most likely be some impact on Latin America's No. 2 economy from protests over the apparent massacre of 43 students abducted by police seven weeks ago.

Luis Videgaray told local radio that the often violent protests that have broken out around the nation could hurt new investment and delay hiring.

"It would be naive to say that it will not have an effect on the economy, but I would dare to say that this is not the most important thing," Videgaray said, pointing to the need to resolve investigations into the horrific crime.

Anger has deepened since the government said last week that evidence suggests the teaching trainees missing since Sept. 26 were murdered by gangsters in the southwestern state of Guerrero and their bodies burned to ashes in a bonfire at a garbage dump.

The students were abducted by corrupt police and handed over to a local drug gang, according to the attorney general.

Protesters set fire to the local legislature building on Wednesday in the capital of Guerrero, while other demonstrators blocked an airport in the neighboring state of Michoacan.

Mexico's economy has performed worse than expected in 2014.

The government cut back a 3.9 percent growth forecast for the year to 2.7 percent in May after a harsh winter in the United States crimped demand for Mexican exports and new taxes weighed on domestic consumption and investment.

Analysts now expect growth of about 2.3 percent this year.

Videgaray also said that Mexico's peso market is operating with sufficient liquidity and in an orderly manner.

The comment underscores the government's commitment to a free-floating currency despite a slump in the peso to a two-and-half-year low this month.

Mexico's stance contrasts with interventions used by other emerging economies to protect local currencies.

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