'The last year has been a difficult one for Mexico.' Pena Nieto acknowledges country's troubles

In his state-of-the-nation address Wednesday, Mexican President Enrique Pena Nieto acknowledged the corruption, crime, and economic problems that have plagued the country. 

Mexican President Enrique Pena Nieto acknowledged Wednesday that the country's crime, corruption and economic troubles have caused distrust and anger among Mexicans.

While Pena Nieto stressed his administration's achievements in structural reforms and government programs, his state-of-the-nation address Wednesday contained a dose of realism.

Pena Nieto began the annual speech by mentioning the disappearance of 43 students in 2014, and the escape of drug lord Joaquin "El Chapo" Guzman.

"The last year has been a difficult one for Mexico," he said. "Our country has been deeply wounded by a series of regrettable cases."

"Complaints about conflicts of interest and corruption ... have created anger and indignation in Mexican society," he said. One of the highest profile cases involved First Lady Angelica Rivera's purchase of a mansion from a government contractor. She later returned the house.

He also noted that the economy was a major source of concern. Prices for Mexico's oil exports are at low levels, and the Mexican peso has fallen about 30 percent against the U.S. dollar over the last year. Two million more Mexicans entered poverty from 2012 to 2014.

"Today, Mexicans hear that oil prices are falling and the dollar is rising and, even those are linked to international issues, they cause fear about the economic effects," Pena Nieto said.

But Pena Nieto urged Mexicans to not allow pessimism to carry them toward those who promise easy solutions.

"Where there is intolerance, demagoguery or populism, nations far from reaching the change they aspire to, find division and setbacks," Pena Nieto said.

Pena Nieto pledged that in the last half of his six-year term the government would combat corruption and crime.

The written report that the president's office released Wednesday reflected uneven progress in the fight against drugs, crime and violence.

For example, as Mexico's opium and heroin exports rise, the country now focuses more effort on eradicating opium poppies than on wiping out marijuana crops. For example, in the first seven months of 2015, about 42,450 acres (17,180 hectares) of poppy fields were destroyed by authorities, almost seven times more than the amount of marijuana. In the past, marijuana had accounted for about 60 percent of drug crops destroyed in Mexico.

The unenviable circumstances are far different from what he faced during his last report on Sept. 2, 2014, just after he had won passage of a series of energy, education and telecom reforms, a success he said would put Mexico on the path to greater growth.

At the time, Pena Nieto was delivering on his main pledge, which was to reduce Mexico's drug-war-era violence. But progress there seems to have stalled. Homicides in the first seven months of 2015 were running about 3 percent above figures for the same period last year.

Pena Nieto's own approval ratings have fallen as well, from 55 percent in August 2014 to about 35 percent one year later, according to a Buendia&Laredo poll published Tuesday. It had a margin of error of 3.5 percentage points.

Jesus Silva Herzog-Marquez, professor of government at the Monterey Institute of Technology, said Pena Nieto's ability to regain popularity in what remains of his presidency will depend on whether reforms bear fruit and the economy rights itself.

"Frankly, I don't see, reading the people who know these things, that it is possible in the medium term," he said.

Associated Press writer E. Eduardo Castillo in Mexico City contributed to this report.