Mexico will hold referendum on new airport: president-elect

President-elect Andres Manuel Lopez Obrador shows a technical report on Mexico City's controversial new airport - already under construction - as he announces a referendum on whether to proceed with the project or cancel it

Mexican President-elect Andres Manuel Lopez Obrador said Friday he will call a referendum on a controversial new Mexico City airport that he has threatened to axe.

The anti-establishment leftist, who takes office on December 1, has infuriated the business community with his attacks on the sleek $13-billion project.

He says the new airport is a "bottomless pit" rife with corruption.

But business leaders say the country desperately needs to replace the capital's current airport, which is aging and overstretched.

"The plan is to provide the Mexican people all the relevant information, truthfully and objectively, so that we can all decide together on this important matter of national interest," Lopez Obrador told a press conference.

He said the referendum would be held in late October, and vowed the outcome would be "binding."

Lopez Obrador, widely known as "AMLO," won a landslide election victory on July 1 -- a resounding rejection of the two establishment parties that have governed Mexico for the past 89 years.

After clashing with the business community during his campaign, he has recently sought to strike a more conciliatory tone.

The airport project, which is already under construction east of the capital, will be an early litmus test for the incoming administration.

Mexico's richest man, the telecoms billionaire Carlos Slim, has said that "canceling the project would amount to canceling the economic growth of the country."

Lopez Obrador's pick for transportation minister, Javier Jimenez, said there would be two choices in the referendum: continue the project or cancel it.

If voters opt to continue it, the government could then decide to use a mix of public and private financing to save taxpayer money, he said.

If they vote to cancel it, the government would continue to use the existing airport and repurpose an old military airbase to serve as a second airport.

Canceling the project would cost the country around $5.2 billion in sunk costs, he said, warning of "a considerable impact on the 2019 federal budget" and a "possible negative impact on the financial markets."

Activists and residents of nearby communities have criticized the environmental impact of the project.

Mexico City's current airport has an official capacity of 32 million passengers per year, but handled 44 million passengers last year.