Next vacancy at Banco de México

In recent weeks, concern has been reborn about the next proposal that the Executive must send to the Senate to fill a vacancy on the Governing Board (JG) of Banco de México. The vacancy that will be generated corresponds to Deputy Governor Gerardo Esquivel, whose term expires on December 31. It must be remembered that Esquivel was approved for the Board in 2019 to end the four years that sub-governor Roberto del Cueto still had to resign. Esquivel meets the legal age requirement to be renominated. However, López Obrador has repeatedly sent signals in public that he does not intend for him to repeat in office.

Esquivel made headlines again when, surprisingly, at quarter to 12, the president named him a candidate for the presidency of the IDB. Revealing that he does not know how these issues move at the international level, where lobbying and negotiation are crucial, he headed Esquivel to certain defeat. It is surprising that Esquivel has lent himself to it, since the logical thing to do would have been to decline the proposal in the absence of that lobbying strategy. It was undignified for a good economist like Esquivel to exhibit him internationally in a painful humiliation where only two countries voted for him.

Last week in the morning AMLO praised Esquivel as a professional with a social sense who “has helped us a lot.” But he did not mention that he would consider ratifying him as deputy governor and, instead, he nonchalantly said that he would find him “a place in an international organization representing Mexico.”

AMLO does not understand that to be part of the JG of the central bank requires a highly technical and experienced profile. But he favors ideological profiles. Some possible names have already transcended at the rumor level. Esquivel has played a decent role in the JG, and will be remembered for his dissenting votes to raise the interest rate. If AMLO is thinking of a highly ideological person, it would be better to rename Esquivel, who has already gone through the learning curve of monetary policy, a matter that was alien to him. Now, if AMLO had a flash of maturity, he would nominate a cadre from within the Bank who already had experience and, above all, institutional memory, which today no member has.

It is probable that AMLO, to show his contempt for autonomous bodies, will take time to nominate the new member and could leave the deputy governorship vacant for several months, as he has done with the board of COFECE and IPAB. The Bank’s Board of Directors can function temporarily without major problems with four members. Especially at this juncture where the JG is very clear about how to move monetary policy for the next 12 months and strong disagreements between its members are not foreseen. On one occasion, during January-June 2007, the JG met with four members.

If Esquivel is not renominated, he has already declared that he would return to his position as research professor at Colmex, his true vocation, from where he will be able to resume his relevant contributions on inequality and poverty. Good luck.

Twitter: @frubli