Mexico could cancel private prison contracts, says president By Reuters

© Reuters. FILE PHOTO: Mexico’s President Andrés Manuel López Obrador listens to the national anthem after addressing the nation

MEXICO CITY (Reuters) – Mexico’s president will seek better conditions for the government in the private prison contracts signed by his predecessors, he said on Wednesday, adding that he could cancel them if better deals are not reached. Private prison contracts were too expensive and represented the worst of privatization, President Andrés Manuel López Obrador said at a regular government press conference. “We need to speak with the providers of these services so that an agreement is reached because we consider (the contracts) abusive,” said López Obrador. He said a civil lawsuit is being drawn up to cancel the contracts if new terms are not reached. López Obrador has lobbied energy and chemical companies for contracts he considers unfair. US asset manager BlackRock Inc (NYSE 🙂 is among investors who have been involved in prisons in Mexico. During the government of López Obrador’s predecessor, President Enrique Peña Nieto, payments for the Ramos Arizpe prison in the northern border state of Coahuila jumped almost 18% just before BlackRock bought it, according to records reviewed by Reuters. in 2017. BlackRock at the time declined to comment. The asset manager did not immediately respond to a request for comment for this article. Former President Felipe Calderón, who preceded Peña Nieto, launched the partial privatization of Mexican prisons during his 2006-2012 term with eight facilities. Under Calderón’s model, the contractors did not manage security or medical care at the facilities, but instead secured the land, built the jails, and then provided services such as food and laundry on 20-year contracts. López Obrador, who ran and lost to Calderón and Peña Nieto, routinely criticizes both men for a variety of political disagreements, as well as alleged bribery during their terms. The leftist López Obrador said a renegotiated agreement should benefit the government’s finances.

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