WiLD Blog

When it comes to the interests of the Mexican people, the government of Felipe Calderón of PAN is dangerously out of touch with reality. The administration’s blunders have gone beyond the environmental authorities’ turning a blind eye to rampant unsustainable development on Quintana Roo’s coast (link to blog post). Recently approaching an abandonment of some key reforms espoused by the government in the wake of the 1910 revolution.

The administration’s proposal to overhaul Petróleos Mexicanos, or Pemex, is an example. It would allow the monopoly to hire companies to assist it with finding and developing new deposits. This could boost flagging oil production, sales of which account for more than a third of the government’s income. However, as the Wall Street Journal reports, oil companies would likely demand a large fee in order to compensate for the lack of any ownership of deposits that are found, which is prohibited by the Mexican Constitution. The bill would also legalize private ownership of oil refineries. Thus Calderon runs the risk of sparking yet another epidemic of foreign exploitation, a problem that has long plagued Mexico.

Alarmingly, a January 2008 report in Proceso suggests that the administration is not wary of this danger; quite the opposite, in fact. In addition to its push to privatize government-owned industries such as Pemex, the administration has endorsed the growing presence of foreign multinationals, largely American- and Spanish-owned, in many sectors of the economy, often at the expense of Mexican-owned firms. For example, the Spanish multinational Gas Natural is the main distributor of natural gas. The Spanish banks Bancomer and Santander are the first and third largest in the country, respectively. The list goes on and on. The government has awarded major concessions to foreign multinationals: Pemex, for example, relies on Schlumberger Ltd. for many services, and the Spanish firm Construcciones y Auxiliar de Ferrocarriles provided most of the trains in the Mexico City Metro and recently won the contract to build a Suburban Railway between Buenavista and Cuautitlán. This welcome mat comes even as foreign multinationals are expanding their influence in Mexico in a “rapacious” way, according to the nonprofit Observatorio de las Trasnacionales en America Latina.

In addition to being blind to the centuries-old threat of foreign exploitation, the Calderón administration appears to be indifferent about one of the major challenges of the 21st century, global warming. Let’s suppose that Calderón is lucky; that the Pemex bill passes, that oil production reverses its decline, and that the country is able to avoid getting a raw deal from the oil companies. Is oil a resource that Mexico should be investing in and producing more of in the first place, given the potential catastrophic effects of global climate change? The country is no doubt strapped for cash, but there are certainly alternative sources of revenue and more responsible, creative economic solutions available. Why not gradually redefine Pemex’s mission as the development of green energy? Invest in ecotourism? Promote organic agriculture, both for domestic consumption and for export?

-Thomas Holder