Mexico's economy starting to flop

Mexico City

LARGELY lost amid the frantic scramble after drug lord Chapo Guzman's dramatic escape, one of the biggest leaps of faith for the Mexican economy landed with a flop.

At the first auction last month to sell the rights to drill for oil in Mexico - as the country opens its oil industry to foreign investment for the first time in eight decades - the government sold just two of its 14 blocks. The disappointing showing for President Enrique Pena Nieto's signature economic reform prompted the government to modify the terms of the contracts for next month's auction, and added to what has been a noticeable string of bad news for Latin America's second largest economy.

Mexico has been held up as one of the economic bright spots among emerging market economies, as Mr Pena Nieto's government has pushed through constitutional reforms aimed at making major industries such as oil and telecommunications more competitive. But in recent months, Mexican newspapers have kept running banner headlines of economic gloom: the value of the peso has plummeted to record lows against the US dollar, growth rates have shrunk to dwarfish size, and the only things that seem to be getting bigger are the poverty rate and the ga…