Latest news with #pan-Mexican
Mint
12-05-2025
- Business
- Mint
America First may be a boon for Walmart's Mexican business
THERE ARE few more potent symbols of American capitalism than a Walmart supercentre, its endless aisles heaving under the weight of as many as 150,000 different products, from fresh avocados to fancy Zojirushi rice cookers. Similarly, there are few more visible emblems of the ties that bind America's and Mexico's economies than those supercentres catering to shoppers south of the Rio Grande. The same can be said of the company that runs these capitalist wonders, alongside neighbourhood Bodegas Aurrerá and Sam's Club membership-only big-box stores, across all 32 Mexican states (and in Central America). Walmart de México, or Walmex, is majority-owned by Walmart but listed on the Mexican stock exchange. It is the country's most valuable public company, worth some $45bn, and its largest private-sector employer, with a workforce 200,000 strong. Like its parent in Bentonville, Arkansas, it is bracing for a Trumpian makeover of North American commerce. For once, it may be better placed to withstand the disruption. Last year was rough for Walmex. Together with other Mexican businesses, it had to contend with stubborn inflation, interest rates near record highs and a rising minimum wage. In June a left-wing populist, Claudia Sheinbaum, won the presidency and her Morena party consolidated control of Congress, allowing it to push ahead with plans to emasculate the courts. Five months later Donald 'Tariff Man" Trump romped back to power in America, threatening to lob grenades at the global rules-based trading system and maybe actual missiles at drug cartels on Mexican soil. Investors dumped the peso and fled the Mexican bourse, whose main index slumped by 14% in 2024. In addition to these pan-Mexican problems, Walmex had to steer a swivelling trolleyful of company-specific ones. In contrast to American Walmarts, its outlets count as relatively high-end. This makes them more vulnerable to penny-pinching by Mexicans, who still buy perhaps a third of their groceries from informal tienditas and mercados. On the formal high street it has had to fend off competition from fast-growing rivals such as Tiendas 3B, an Aldi-like discounter which went public a year ago. Online it was being outmatched by e-commerce marketplaces such as Mercado Libre. Sales and operating profit grew more slowly than in previous years. Margins tightened. To top it off, Mexico's competition regulator was breathing down its neck over its alleged abuse of market power in its dealings with suppliers. By late November, Walmex's market value languished at 900bn pesos, down from 1.3trn pesos in January that year. In dollar terms it had collapsed by 40%, from $73bn to $44bn. Even in Mexico's struggling stockmarket the company looked disappointing. Next to its go-getting parent up north, whose market capitalisation leapt from $450bn to $740bn on the back of perky American GDP growth and Mr Trump's promise of more of the same, it appeared the underachieving offspring. As the weaker of the two firms in the feebler of the two economies, Walmex might be expected to suffer more than Walmart now that Tariff Man is putting his duties where his mouth is. On March 4th Mr Trump imposed 25% levies on imports from Mexico and Canada, ostensibly because they were letting fentanyl flood into the United States. He paused most of them two days later, but may change his mind again next month. Even before the latest whiplash, Mexico's central bank halved its forecast for Mexican GDP growth this year, to 0.6%, given all the uncertainty. That is bad for consumer spending—and so for Walmex's bottom line. Yet in several ways Walmex looks less exposed to Mr Trump's policies than Walmart. Measured by value, just 17% of what Walmex sells in Mexico comes from abroad. Walmart's equivalent share in America is twice that. In 2022 Walmart imported nearly 1m standard 20-foot containers, more than any other American company, according to the Journal of Commerce, a trade publication. It does not say where these boxes originate. But it is a good guess that many arrive from Mexico (all those avocados and other fresh produce) and similarly tariff-hit China (some of those Zojirushi rice cookers), as well as Canada (for which Mr Trump reserves especial scorn). Helpfully for Walmex, any retaliatory tariffs Ms Sheinbaum may impose would probably be targeted so as to minimise the harm to Mexico's wobbly economy. This points to another source of comfort for the company, and Mexican business as a whole—the president herself. Who's the piñata? Yes, she clings to some costly populist pledges, such as raising the minimum wage by 10% or so a year. Still, Mexican CEOs report that she has proved more receptive to their concerns than expected from a protégée of her business-loathing predecessor, Andrés Manuel López Obrador. Were it not for Mr Trump's economic vandalism, she might have been less inclined to soften her attitude to the private sector, they say. In a sign that forbearance may be spreading, in December Mexico's competition cops concluded the investigation into Walmex with a $5m slap on the wrist. At the same time, Mr Trump's fentanyl finger-wagging is forcing Ms Sheinbaum at last to crack down on organised crime, a perennial corporate bugbear. In late February Mexico extradited 29 alleged kingpins to America. As a Mexican executive sums it up, with a Morena-dominated government, 'the only check and balance comes from Trump." That is not to say todo está bien. Walmex's share price has stagnated since Mr Trump first announced the tariffs on Mexico at the end of January. But things could be much worse. Just ask investors in Walmart, whose stock has lost 11% of its value. Subscribers to The Economist can sign up to our Opinion newsletter, which brings together the best of our leaders, columns, guest essays and reader correspondence.
The Hill
13-02-2025
- Politics
- The Hill
Immigration has created a ‘Nuevo South' in North Carolina
In the foothills of North Carolina's Blue Ridge Mountains, a nondescript white clapboard house has become one of the most popular restaurants in rural Stokes County: Luna's Mexican Kitchen. This is Trump country (he got 79 percent of its votes last year), overwhelmingly white, and favored the president by nearly 82 percent in 2024. Yet, stereotypes notwithstanding, Luna's owner, Angel Hernandez, 35, says 'there are no words to explain our reception. Everyone was very nice. Everyone helped me.' After 18 months in business, patrons come from neighboring Surry County and as far as Virginia for Luna's pan-Mexican cuisine. The weekly Stokes News featured the restaurant in its 'Loaves and Dishes' column. Hernandez, a stocky man dressed in a black Cinco de Mayo T-shirt, spoke as music from a Colombian radio station filled the small restaurant. Twenty years ago, on the advice from an uncle living in the U.S., the teenager immigrated from northern Mexico to North Carolina's Piedmont region. Hernandez joined 'The Great Latino Migration,' a historic movement that brought millions of Spanish-speaking migrants to the Southeast. After years working various area jobs, Hernandez wanted to start a restaurant and so began driving in Stokes and Surry Counties. 'I saw this little spot,' he recalled. 'It was so cute.' The restaurant is a family affair, named for his daughter, Luna, one of his two American-born children. His young son helps out when not in school. His wife Andrea's name appears on the restaurant's blackboard specials ('Andrea's Burrito'). She is also an apartment manager. Hernandez and his restaurant exemplify a much larger trend, according to Rodrigo Dorfman, an artist, documentarian and a founder of a new magazine titled 'Nuevo South.' Dorfman says the Southeast's face is changing — again — with a browner complexion and ubiquitous Spanish language and accent. Hispanic migration here began around 1990, when farm workers, mostly single men, began stopping for work on the way from Georgia to Virginia's fields and orchards and even to New England. U.S. recruiting brought them to North Carolina, where they settled with their families. Dorfman's personal journey to the Tar Heel State was quite different. He accompanied his mother and father, novelist and playwright Ariel Dorfman, who escaped Chile's 1973 right-wing military coup and joined the faculty of Duke University, with its robust Latin American Studies program. Recently, more than 50 people, mostly Hispanic, including several small-business owners, attended Dorfman's magazine launch party in a skylit gallery on Duke's campus. On display was his art, combining photography, painting and AI, which he calls 'docu-painting.' Proceeds supported 'Nuevo South.' The quarterly's first, 144-page issue received a $17,400 City of Durham grant, and is printed in full color on heavy, glossy stock and perfect binding. It is 'strategically bilingual,' Dorfman says. There is artwork by young community interns, plus professional portraits of everyday people. Features range from Latina entrepreneurs to an aging drag queen. In the social media age, many magazines are jettisoning print and going digital-only. Launching a physical magazine seems counterintuitive, even countercultural. But as Dorfman explains, 'We live in the digital world because that's how we communicate with our loved ones far away — and we also value that which we can touch, that which physically brings us together.' While many Cubans, Venezuelans and Puerto Ricans settled in Florida, a potentially bigger story of Hispanic immigration to the southeast is emerging, with 'Nuevo South' its most recent milestone. Dorfman says his Durham-based magazine aims to preserve that saga. 'We need to find a way to share our narratives without erasing other narratives in the process,' he said, speaking of their integration in a new land. Which Dorfman is trying to do. His 2024 PBS 'POV' series film is titled 'Bulls and Saints,' about Mexican migrants to eastern North Carolina bringing many customs, including bull riding, the focus of a regular summer communal festival drawing thousands from the Southeast. The magazine's 'Duramitas' cover story focuses on Durham. The city's Hispanic community has grown exponentially since 1986, when barely a dozen people benefited from President Ronald Reagan's 1986 amnesty for 2.7 million undocumented immigrants. The community has grown 500 percent since 2005. Today, financial institutions and money transfer outlets accompany numerous convenience stores, food trucks, nail salons, lawn services, car parts and used tire businesses, takeout taquerias and restaurants (several specializing in Honduran and Peruvian cuisine) and dozens of construction companies. Migrant children have joined the professional ranks, and Hispanics serve on Durham's city council. 'Pincho Loco,' a favorite ice cream store near Duke's campus, encapsulates the Hispanic success story. It is run by a Salvadorean family whose son is in the U.S. military and whose daughter is a junior at Duke. However, increased Latino presence brings increased concern about the Trump administration's immigration crackdown. 'We know that the undocumented immigrant community is the most at risk,' Ivan Almonte, a longtime immigrant organizer told WUNC-FM radio. 'We're mobilizing the community across the state. It's important to be part of a group of community organizers because each county, each city, is different.' Almonte's Durham Rapid Response (Respuesta Rápida de Durham) serves the estimated 325,000 people who lack legal status in North Carolina. Most are Hispanics in construction, agriculture and service industries, according to the Office of State Budget and Management. 'After 30 years of settlement and a multi-generational presence firmly rooted in the South,' Dorfman says, 'we're trying to go from crisis mode to constructive mode. We are now facing this threat, but we can't fall back into crisis mode because we will lose everything we have built.'
