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Future Prospects for Infrastructure: Towards a Multi-model Integration in Transport and Communications During the 2024-2030 Administration

Infrastructure constitutes a determinative factor within the model of prosperity and economic growth. Through proper planning and the use of public resources in an efficient, effective, economic, transparent and honest manner, it is possible to attract, encourage and trigger investment in the country, which, invariably, will result in growth and development in the areas of influence where the projects are carried out, as well as the wellbeing of their residents. During her campaign, the president elect announced the document known as “100 Steps for Transformation”, which outlines the main pillars, objectives and guiding principles of her administration. This document is regarded as laying out the foundations of what will be the National Development Plan which will be drafted by the Federal Government within the timeframes established in the Planning Law. From a reading of the document “100 Steps for Transformation”, Claudia Sheinbaum and the 2024-2030 Administration will pay special attention to infrastructure, with a holistic vision of investment and its effects on the development of Mexico with four key components: inclusion, innovation, sustainability and planning based on the regional vocations of the country. As part of the national project which has been called the “Second Floor of the Fourth Transformation”, an interesting proposal has been put forward, with the objective of encouraging investment in transport and communications infrastructure with a multimodal vision. As will be discussed below, the proposal for multimodal integration seeks primarily to strengthen the competitiveness of our country by taking advantage of Mexico’s strategic location to encourage the integration of supply chains between all regions and their movements to and from overseas.   Context: A historic moment to be seized. Mexico finds itself in a privileged position within the current global context. On the one hand, we face the imminent transition from global to regional supply chains, which stems from the effect of the COVID-19 pandemic and the geopolitical and economic conflicts of recent years. In addition, the phenomenon of nearshoring, which aims to bring production chains closer to the final point of consumption, represents a clear opportunity to promote investment in Mexico because of its strategic geographic location for trade with North America and Asia. Being in this position unavoidably imposes an obligation on the authorities to provide the economic and legal conditions necessary to make Mexico an attractive market for investors, both domestic and foreign; as well as the corresponding challenge for the private sector to identify and take advantage of the investment opportunities that this context offers. Proposals for the 2024-2030 Administration: Promotion of investment in infrastructure with a focus on integration. The document “100 Steps to Transformation” sets out a strategy of continuity for the  work carried out by the administration lead by Andrés Manuel López Obrador, identifying diverse areas of opportunity to consolidate the projects already underway and identifies new priority projects that will seek to encourage investment focused on the following sectors: rail, both passenger and freight; land, including highways, rural roads and urban transport; ports and airports. The proposals put forward by the 2024-2030 Administration envision that investment in these sections will not be carried out in isolation or independently, but on the contrary, will promote a comprehensive and multimodal vision that allows the benefits of each of the sectors described above to be leveraged so as to trigger regional development, as well as to take advantage of the opportunities that the country’s geographic location offer in terms of good transport, relocation and nearshoring. 1. Commitment to the promotion and strengthening of rail transport. As is public knowledge, during his administration, López Obrador boosted rail transport. Proof of this is the ambitious Tren Maya project, which is 1,554 kilometres long, has 20 stations and 14 stops, and which operates in a mixed mode, with both passengers and cargo. Likewise, the Interoceanic Corridor of the Isthmus of Tehuantepec project aims to restore and preserve the 308 kilometres of the Z Line that connect the Gulf of Mexico with the Pacific; the 329 kilometres of the FA Line which run from Coatzacoalcos to Palenque and will connect to the Tren Maya, as well as the 459 kilometres of the K Line which connects Ixtepec with Ciudad Hidalgo. Important legislative and regulatory amendments framed the efforts of López Obrador in the railway sector, such as the reforms of the General Communication Roads Law in relation to railway allocations, as well as the strengthening of the Railway Transport Regulatory Agency. In line with the commitments outlined in her “100 Steps for Transformation”, Sheinbaum plans to continue implementing the Fourth Transformation to boost the railway sector in the country, placing a special emphasis on the fact that new projects will be developed with strict adherence to suitable tech-finance studies to ensure they have a positive impact on the mobilities of the cities and areas that require it, aiming to improve railway safety. In terms of freight rail development, it is expected that, during this next administration, the Tren Maya and Interoceanic Corridor project will be consolidated and the Roberto Ayala-Dos Boca and Line K to Chiapas connection projects will be completed. Among the new projects that will be pursued are the Mexico – Tuxpan Railway Corridor, the Guadalajara – Aguascalientes Railway Link, the Mazatlán – Durango railway line, as well as various metropolitan highways and an increase in intermodal connection points to double the amount of cargo currently transported by rail. With regards to passenger rail infrastructure, the main objective is to connect people in an efficient and sustainable way through the development of a Strategic Plan for the rail Sector, guided by the philosophy of sharing use of tracks (types of service, speeds and systems of operation). To this end, it is proposed to follow up on the “Decree declaring the provision of public passenger rail transport services in the Mexican Railway System as a priority area for national development”, which established that the first seven routes to be operated would be: Mexico-Veracruz-Coatzacoalcos Train, AIFA-Pachuca Interurban Train, Mexico-Queretaro-Leon-Aguascalientes Train, Manzanillo-Colima-Guadalajara-Irapuato Train, Mexico-San Luis Potosi-Monterrey-Nuevo Laredo, Mexico-Queretaro-Guadalajara-Tepic-Mazatlán-Nogales and Aguascalientes-Chihuahua-Ciudad Juarez. Finally, as part of the government's proposals and actions contained in “100 Steps for Transformation”, it includes evaluating the use of 18,000 kilometres of railways in two stages, the first of which includes the Mexico - Queretaro - Leon - Aguascalientes Train, the Mexico - Queretaro - Guadalajara Train, the Mexico - San Luis Potosi - Monterrey - Nuevo Laredo Train and the Mexico - Puebla - Veracruz Train. 2. Connectivity for all: road infrastructure, rural roads and urban mobility. During several administrations, road infrastructure has been one of the main pillars for promoting infrastructure investment. It is clear that a safe, efficient and modern road network is a driver for mobility and economic growth, benefiting the population and the transport of goods. However, the President Elect proposes, in addition to continuing with the measures to strengthen the road network, to pay special attention to the infrastructure associated with rural roads and those related to urban mobility. In relation to road infrastructure, the “100 Steps for Transformation” envisages as one of the main objectives focused efforts on road maintenance with special attention on rural areas and marginalised communities, emphasising the multimodal approach by which the road network is to be integrated with other modes of transport such as rail, ports, and public transport in order to facilitate and develop the transport of people and goods. In summary, an improvement and expansion of the tolled and federal road network: widening of the Los Cabos to Tijuana coastal highway, construction of the Los Mochis to Ciudad Juarez - Chihuahua highway, widening of the Guaymas to Ciudad Juarez highway, the highway connecting San Luis Potosi-Saltillo-Monclova-Piedras Negras, construction of the Pachuca-Huejutla-Tamazunchale highway, widening of the Toluca - Tejupilco - Coyuca de Catalán - La Unión- Zihuatanejo highway, construction of the Cuautla-Tlapa-Marquelia highway, widening of the Puebla-Amozoc highway and the coastal highway from Salina Cruz to Zihuatanejo. In respect of rural road infrastructure, a fundamental objective is to restore at least three thousand kilometres of rural roads and to expand the National Roads Manpower Programme in the states of Oaxaca, Guerrero, Chihuahua and Hidalgo. This is expected to benefit the 21% of our country’s population living in towns with less than two thousand and five hundred inhabitants. True to her experience and achievements in Mexico City during her term as Head of Government, Claudia Sheinbaum has made urban mobility, public transport and electromobility in the country’s cities one of her government’s priorities. To this end, it is proposed to coordinate and support measures in the main cities of the country which will seek to implement electric mass public transport systems, such as the trolleybus, metrobus and cablebus. It is also expected that the next administration will carry out measures aimed at the transition to electromobility. 3. Transform Mexico into a logistics powerhouse by developing port infrastructure and investing in development hubs for wellbeing. As part of the “100 Steps for Transformation”, the importance of port infrastructure in the development and economic growth of the country is recognised. As stated in that document, boosting the growth of port capacity in the country “…enables and will enable Mexico to occupy its rightful place among the world’s logistics powers, while ensuring the supply of components and goods”. During the administration of President López Obrador, significant work was carried out in the port sector. From the structural reforms and the integration of the National Port System to the development and modernisation of the ports of Coatzacoalcos and Salina Cruz as part of the development of the integrated programme for the Interoceanic Corridor it is evident that, for the so-called Fourth Transformation, ports occupy a fundamental place for the development of the country. As part of the continuity proposed as part of the “Second Floor of Transformation”, the need to strengthen the port sector with a multimodal integration approach is reiterated. The “100 Steps for Transformation” recognises that it is not only through investment in ports and terminals that growth and development in the port sector will be consolidated, but that it is necessary to provide such port and terminals with a complementary connectivity infrastructure to distribute, in Mexico and abroad, the goods arriving at the ports and terminals. Her aim is, on one hand, to promote multimodal transport that directly affect the efficiency required by the supply chains, reducing the costs and transportation time of goods and, on the other hand, to promote the installation of new companies interested in the potential of our country derived from the nearshoring phenomenon. One of the main measures that, in terms of the “100 Steps for Transformation”, will be implemented by the Sheinbaum Administration will be to continue with the development of the Interoceanic Corridor of the Isthmus of Tehuantepec, which includes two fundamental government actions to promote investment in the region: the modernisation and expansion of infrastructure of the port of Salina Cruz and Coatzacoalcos and investment in the development hubs for wellbeing distributed along the corridor. These two actions seek to promote private investment in a sustainable and lasting manner, which will lead to benefits for the country through the development and promotion of trade and transport of goods in the country and abroad, as well as economic development and job creation in the region, which will translate into greater wellbeing and quality of life for the population. In addition, the projects identified in the “100 Steps for Transformation” as priorities in the port sector include the expansion and/or construction of the port of Ensenada, Guaymas, Mazatlán, Manzanillo, Lazaro Cardenas and Salina Cruz on the Gulf of California and the Pacific, as well as the ports of Seybaplaya, Coatzacoalcos, Veracruz and Altamira on the Gulf of Mexico. 4. Airport Infrastructure that meets present and future needs. As part of the 2024-2030 Administration’s multimodal infrastructure integration proposal, the airport sector will remain one of the Federal Government's priorities. Claudia Sheinbaum’s administration is expected to continue the measures initiated by López Obrador concerning the improvement, restoration, maintenance and expansion of the Mexican Airport System; to consolidate the efforts to turn Felipe Ángeles International Airport (AIFA) into a viable alternative for passengers from the ZMVM, and as a cargo hub connected with the corridor comprising Mexico City, the State of Mexico and Hidalgo; and position Mexicana de Aviación as a competitive airline. In order to take advantage of Mexico’s strategic location as a guiding principle for the relocation of foreign investment, it is essential that the airport infrastructure, both for passengers and cargo, is prepared to meet the growing need for air transport. To this end, government actions for the 2024-2030 administration include strengthening the state-owned sector for the construction, development and operation of airports in Mexico; planning the second phase of AIFA, which will include the expansion of the passenger terminal and the cargo area to a capacity of 700 thousand tonnes per year; continuing with the expansion of concessioned airports through the review and application of their Master Development Programmes; as well as the expansion of the airports of Ensenada, Tepic, Tamuín, Torreón, Lázaro Cárdenas y Puerto Escondido. Final Reflections From a reading of the “100 Steps for Transformation” and the statements of the president elect and her spokespersons, it is clear that the Federal Government’s 2024-2030 commitment to infrastructure will have two guiding principles: the first is to continue, expand and strengthen the flagship projects of Andrés Manuel López Obrador; the second is to promote investment in projects that take advantage of Mexico’s strategic location and promote the integration of supply chains through the transport of goods between all the regions of the country and their movement to and from overseas, thus strengthening the country’s competitiveness. The document outlines the projects that will be prioritised by the public administration; however, it is the responsibility of the private sector to identify investment opportunities in projects, whether greenfield or brownfield, which meet the requirements and principles established by the future president of Mexico. For her part, the greatest challenged facing the administration led by Sheinbaum will be to continue the national project initiated by her predecessor, while identifying her own philosophy and being able to deliver in accordance with it; to take advantage of the country’s current contact and the appetite of the private sector (national and foreign) to invest in Mexico and, finally, to identify the mistakes inherited from the outgoing administration that have resulted in an atmosphere of uncertainty for investors. Both the public and private sector will need to bring in experts to enable them to address with the utmost diligence, responsibility, certainty and knowledge the challenges they both face in order to achieve a common goal, national growth and development. At CMS Mexico we have had the opportunity to participate in several of the key projects that, in accordance with the “100 Steps for Transformation”, will be continued by the 2024-2030 Administration, such as the implementation of the first stage of the Tren Maya during the coordination with the then National Tourism Development Fund (FONATUR); the rehabilitation of Line K that interconnects with Central America and runs from Ixtpec, Oaxaca to Ciudad Hidalgo, Chiapas; the implementation of 3 development hubs fir well-being located in Oaxaca and Vercruz, as well as the development and modernization of the ports of Salina Cruz and Coatzacoalcos as part of the integrated programme of the Interoceanic Corridor of the Isthmus of Tehuantepec, among others.   Infrastructure & Projects Partner at CMS México

Defending Marketing Authorization of Medicines before COFEPRIS: failure to respond and arbitrary cancelations.

RIGHT TO HEALTH, A HUMAN RIGHT. Article 4 of the Mexican Constitution considers health as a human right, so the government is obliged to guarantee it to Mexican citizens, primarily by providing access to public health services such as public hospitals; and having a health law legal framework that sets the basis to provide safe and effective health products, services, and treatments. This means the Federal Commission against Sanitary Risks (“COFEPRIS”), the Mexican health authority that authorizes and surveils medicines must be efficient in the evaluation and authorization of medicines and therapeutic alternatives to keep quality medical products in the market and protect the health of Mexicans.   THE REGULATORY REGIME. In Mexico, to be manufactured, imported, and marketed, medicines require marketing authorization of medicines under the General Health Law ("GHL") and the Health Supplies Regulation ("RHS"), which must be renewed every 5 years. To renew the marketing authorization of a medicine, it is necessary to request it 150 days before its expiration date. This is intended to give COFEPRIS enough time to evaluate and analyze the request for an extension of the marketing authorization before its expiration date and do not affect the holder. However, COFEPRIS does not currently comply with these timeframe objectives even though they are expressly stated in the law. On the other hand, there are precedents where it is established that those requests for the renewal of the marketing authorization that have been filed on time and have not been resolved are understood to be approved. This causes uncertainty in the purchase of products in the public sector such as the Mexican Health and Wealth Fare Services (“IMSS”), Mexican Health and Wealth Fare Services of Government Employees (“ISSSTE”), and Ministry of Defense (“SEDENA”), being these only some examples due to the validity of the products and the capacity to receive them in their warehouse when COFEPRIS has not answered the extension of the marketing authorization of a medicine. This issue is not limited to causing problems in the public sector, as the problem is also transferred to the private market. In addition, inconsistencies have been detected in the criteria that generate arbitrary refusals without being duly grounded to these extensions of the marketing authorization that lead to the cancellation of it and as a consequence affect the continuity of the supply of medicines at a national level. This is a very serious problem as it jeopardizes the supply of medicines to patients, as well as the production chain and financial planning of companies engaged in the health sector.   LEGAL TRENDS AND DEFENSES FOR DEALING WITH REGULATORY UNCERTAINTY. Some of the successful defense strategies to these problems are: Administrative appeal. Administrative Litigation. Amparo Proceeding. These means of defense allow to combat arbitrary acts of authority and the lack of response of the same in which is possible to get both provisional and definitive suspensions for the benefit of our clients. The suspension is a precautionary measure that has the effect of maintaining things in the same state in which the law foresees them until the trial is resolved. This is a great benefit because, as mentioned above, if the authority does not respond, the extension of the marketing authorization is understood to be appropriate, and the product can continue to be commercialized. Thanks to the suspension, health companies can maintain the production chain of the medicines that submitted the extension of the marketing authorization on time but have not received an answer from COFEPRIS and therefore continue their commercialization under the protection of a judicial resolution that authorizes it. Likewise, thanks to administrative lawsuits, COFEPRIS has been forced to issue the renewal of the marketing authorization. This results in a great benefit for society because the medicines that people consume remain in the market and the companies dedicated to the health sector are not affected in the production chain or the commercialization. This strategy has implied significant progress in both the regulatory and judicial spheres, as once again the judiciary has been the one to remedy the deficiencies of the executive branch, i.e. the deficiencies faced by COFEPRIS as an institution. On the other hand, strategies have been implemented to combat unfair competition in the pharmaceutical sector through investigations and consultations on marketing authorizations, import permits, imports under the agreement of January 28, 2020, interaction with irregular importers and traders, and complaints, among others. These strategies have resulted in the authority issuing health alerts regarding products that pose a risk to the population.   CHALLENGES FACING SANITARY REGULATION IN MEXICO. In Mexico, health regulation faces great challenges, in particular, the pharmaceutical sector, both in the field of medicines and medical devices related to regulatory uncertainty and, as a consequence, corruption. Currently, several regulatory and operational impediments negatively affect access to medical treatments to the detriment of the health of the Mexican population. One of the major regulatory impediments is the failure of the authorities to comply with the deadlines established by law to resolve user requests. To provide regulatory certainty, and full compliance with the regulatory framework for protection against health risks, which translates into: Provide clarity to the user on the authorization requirements and their definition, the internal evaluation process, and the time associated with each of the stages of the evaluation. Ensure a standardized evaluation based on technical and scientific criteria and not on arbitrary and bureaucratic criteria. Effective recognition of the decisions of regulatory authorities in other jurisdictions. To guarantee regulatory harmonization with internationally valid standards to favor industrial development, access to new medical treatments, and competitiveness. On the other hand, health regulation in Mexico must promote the implementation of the recommendations issued by the World Health Organization so that the procedures, services, and resolutions provided by the health authority are similar to what is done internationally. In this regard, in 2022 the Ministry of Health announced a regulatory certainty strategy for the pharmaceutical and medical device sector so that by 2030 the challenges mentioned in this section will have been overcome and the regulatory framework for protection against health risks will be fully complied with.