Job One for Mexico's New Leader: Fix Migrant Crisis

President-elect Andrés Manuel López Obrador faces a host of pressing issues, including Central American migrants at the U.S. border.

President-elect Andrés Manuel López Obrador faces a host of pressing issues, including Central American migrants at the U.S. border.


Photo:

Oscar Ramírez/Notimex/Newscom/Zuma Press

MEXICO CITY—President-elect Andrés Manuel López Obrador will become Mexico’s president on Saturday amid a migration crisis that threatens to strain relations with the U.S. and rising concerns about his economic and security plans.

Mr. López Obrador, 65, will don the presidential sash at Mexico’s Congress before lawmakers and some 400 foreign guests, including U.S. Vice President Mike Pence; Ivanka Trump, President Trump’s daughter and senior White House adviser; and Venezuela’s Socialist President Nicolás Maduro, whose administration is under U.S. sanctions.

After his inauguration, the leftist nationalist will face issues that will test U.S.-Mexican ties, especially a crisis at the border, where thousands of Central American asylum seekers are stranded in Mexico as the Trump administration toughens its immigration stance. As border tensions rise, Mr. Trump has threatened to close the border.

Central American migrant children who have trekked for a month across Central America and Mexico in the hopes of reaching the U.S., played at a temporary shelter in Tijuana this week.

Central American migrant children who have trekked for a month across Central America and Mexico in the hopes of reaching the U.S., played at a temporary shelter in Tijuana this week.


Photo:

guillermo arias/Agence France-Presse/Getty Images

Migration “is the most important matter that we have right now,” Olga Sánchez, who will become Mr. López Obrador’s interior minister, said on Wednesday.

The issue will top the agenda when incoming Foreign Minister Marcelo Ebrard holds a working dinner on Sunday with U.S. Secretary of State Mike Pompeo in Washington. Mr. Ebrard and U.S. officials have been discussing a plan in recent weeks that would require migrants seeking asylum in the U.S. to wait in Mexico while their claims are processed, say members of Mr. López Obrador’s team.

U.S. officials have been discussing a new plan with the incoming Mexican administration over how to handle the rising number of migrants, seen here in a Tijuana shelter.

U.S. officials have been discussing a new plan with the incoming Mexican administration over how to handle the rising number of migrants, seen here in a Tijuana shelter.


Photo:

alonso rochin/epa-efe/rex/Shutterstock

In exchange, Mr. López Obrador wants the U.S. to significantly raise the number of asylum requests it processes and provide funds to help shelter and assist migrants. The Mexican leader also seeks U.S. backing for his six-year, $20 billion initiative to foster development and investment in Central America aimed at providing the region’s citizens more reason to stay home, these people say.

“The new government inherits a huge, unexpected problem at the border,” said Eunice Rendón, who leads Mexican nonprofit Migrant Agenda. “You can’t be weak with Trump, but you need some sort of collaboration.”

Mr. Ebrard has said that the new administration will preserve Mexico’s policy of offering asylum to Central American migrants. According to the Interior Ministry, nearly 700 Central American migrants who arrived in caravans in recent weeks had obtained humanitarian visas to stay and work in Mexico.

The ministry recently said it has repatriated about 11,000 Central Americans in recent weeks. Nearly 100 of them were deported for using violence in an attempt to illegally enter the U.S. before being repelled by Border Patrol agents with tear gas last week.

Mr. López Obrador, speaking in Mexico City this week to Mexican troops, plans to create a National Guard with soldiers, marines and federal police to fight drug-cartel violence.

Mr. López Obrador, speaking in Mexico City this week to Mexican troops, plans to create a National Guard with soldiers, marines and federal police to fight drug-cartel violence.


Photo:

ho/Agence France-Presse/Getty Images

For the first time since 2000, the new president will give an inaugural address in Congress’s lower house, after leftist lawmakers in 2006 and 2012 turned away Presidents Felipe Calderón and Enrique Peña Nieto, calling them illegitimate presidents after they beat Mr. López Obrador in close elections they said were rigged. The electoral authority validated the results.

Mr. López Obrador, who takes office for a six-year term, won July’s election by a landslide, riding on a wave of discontent with the political establishment, government corruption and crime. His core proposals—to eradicate corruption, bring austerity to government and greatly expand social programs and public investment—raised great expectations among Mexicans.

But as president-elect, Mr. López Obrador has roiled both investors and some citizens. In October, he said he would cancel the construction of a $13.3 billion airport outside Mexico City, sparking a market selloff.

The incoming president said he would halt construction of a $13.3 billion airport outside Mexico City, alarming many investors.

The incoming president said he would halt construction of a $13.3 billion airport outside Mexico City, alarming many investors.


Photo:

Brett Gundlock/Bloomberg News

The move contributed to a nine-point fall in his approval ratings to 56% from August, according to a poll published this week by El Universal newspaper.

Investors are also concerned about the future of the historic 2013 overhaul that opened up the energy sector to private and foreign investment. Members of his energy team have long opposed the industry’s opening, which was also unpopular among many Mexicans. The use of referendums on public policy, which Mr. López Obrador has said will be the norm, has increased investor uncertainty.

There are also concerns about his administration’s fiscal restraint. Mr. López Obrador’s ambitious spending plans include $6 billion in a new refinery in his home state of Tabasco. Another $5 billion is targeted for jobs to some 2.3 million young people annually. He plans to offer free Wi-Fi and invest another $6 billion for universal health care. His plan for new 930-mile train in the Yucatán Peninsula is expected to cost at least $7.5 billion.

“There is concern in the market on whether the next administration is committed to maintaining a fiscally conservative stance or if it instead chooses a more expansive approach to public spending and indebtedness,” said Luis Arcentales, an economist with

Morgan Stanley
.

A Petróleos Mexicanos refinery in Villahermosa. Members of Mr. López Obrador’s team have opposed opening the nation’s oil industry.

A Petróleos Mexicanos refinery in Villahermosa. Members of Mr. López Obrador’s team have opposed opening the nation’s oil industry.


Photo:

Alejandro Cegarra/Bloomberg News

Mr. López Obrador aims to balance the 2019 budget through government austerity and the fight against corruption, without increasing taxes or debt. The budget, to be presented on Dec. 13, will be closely watched by investors.

The Mexican leader’s economic team has tried to reassure investors in recent days. “It will be a conservative budget,” said incoming deputy finance minister Arturo Herrera.

Another challenge is Mexico’s crisis of violence. Homicides reached a 20-year high last year and are up another 20% through September. Mr. López Obrador’s recently disclosed plan to create a National Guard with soldiers, marines and federal police to fight drug-cartel violence raised skepticism among human rights groups.

“Soldiers are trained to obey and eliminate the enemy, not to work with the community,” said María Elena Morera, head of Common Cause, an advocacy group.

One controversial issue that Mr. López Obrador won’t immediately have to contend with is trade. The U.S., Mexico and Canada were set on Friday morning to sign a new trade pact, a day before the new leader takes office. Mr. López Obrador didn’t plan to attend.

Write to Juan Montes at juan.montes@wsj.com