Mexico and Venezuela are both federal republics with civil law systems. However, Venezuela has shifted towards socialism under former President Hugo Chavez. Relations between Mexico and Venezuela were strained at times due to disputes between Chavez and Mexico's former president. CEMEX faced difficulties operating in Venezuela due to the lack of economic freedom and the nationalization of its assets by the Venezuelan government. The business environment in Venezuela poses greater constraints such as higher crime, disorder, and political instability compared to Mexico.