Mexico’s Sweet Toothache

Oaxaca prescribes regulatory change.

Mexico has an obesity crisis, approximately 45% of adults and a third of minors suffer from weight problems, which translates into high rates of related diseases such as hypertension and diabetes.


Demand for medical treatment for these conditions taxes the health sector. Successive governments have attempted to alleviate the burden, but progress has been slow. Studies linking obesity to higher death rates from COVID-19 have bolstered the government’s resolve to tackle the issue, a senior health official told us, “The pandemic has sensitized both decision-makers and citizens about the need to pay attention to health and diet.”

On 5th October, the state of Oaxaca filled the void left by the federal government’s inaction. The state approved a bill to prohibit the sale, distribution, gift and supply of sugary drinks and “junk foods” to minors. “This health emergency makes it even more evident the damage caused by the consumption of sugary drinks,” said Magaly López Domínguez, the Oaxaca lawmaker who presented the original bill

“Sugary drinks are ‘bottled poison’ says López-Gatell, Mexico’s spokesman on COVID-19.”

Senior health official, Secretariat of Health.

A senior executive from FEMSA is understandably concerned, “there is a double impact as it will hurt our soft drinks brands but also our OXXO business which must stop selling these products, which contribute significantly to sales.” This is compounded by other upcoming regulatory change hitting FEMSA including restrictions on single-use plastic and stricter labelling requirements.


Despite criticism from business, according to our sources, other states already intend to replicate Oaxaca, and federal legislators have expressed interest in escalating the bill nationally, “it is necessary to continue building a restrictive legal framework for harmful foods and it is desirable that it be done at the federal level,” reports a senior health official.

“It looks more like an anti-drinks law rather than a good health law.”

Senior executive at FEMSA.

Clearly the soft drinks companies and processed food producers plan to fight back. They are preparing legal cases based on the inconsistency of the regulatory changes in the fight against obesity and are investing in healthier product innovation. We believe they should accelerate the latter as the rest of Latin America is watching and according to our sources “Mexico frequently defines the path.”

Important Notice
While the information in this article has been prepared in good faith, no representation, warranty, assurance or undertaking (express or implied) is or will be made, and no responsibility or liability is or will be accepted by Deheza Limited or by its officers, employees or agents in relation to the adequacy, accuracy, completeness or reasonableness of this article, or of any other information (whether written or oral), notice or document supplied or otherwise made available in connection with this article. All and any such responsibility and liability is expressly disclaimed.
This article has been delivered to interested parties for information only. Deheza Limited gives no undertaking to provide the recipient with access to any additional information or to update this article or any additional information, or to correct any inaccuracies in it which may become apparent.

Most recent in Consumer

Argentinanomics

The impact of cross-border spending sprees on Uruguay’s economy.

LatAm’s food crisis

Unprecedented food prices drag more people in Latin America into food insecurity.

Dairy difficulties

Insurmountable barriers frustrate the growth prospects of Latin America’s dairy producers.

Nearshoring: an ESG opportunity?

Can Latin American nearshoring deliver economic benefits and address ESG challenges?

Playtime

Is China’s dominance of the children’s toy market in Latin America waning?

Smells good

Latin America's fragrance market sees strong post-pandemic recovery and an increase in regional production. 

Remittances

Remittances to Mexico reach record highs as fintechs and Oxxo circle the opportunity.

Favoured food

Mexico promotes cheap food imports and privatizes health checks to reduce inflation and tax, what could go wrong?

Coming of age

Uruguayan wine exports are growing but can they compete with New Zealand and South Africa?

Tourist hotspot

Dominican Republic’s foreign visitors exceed pre-pandemic levels.