Peña Nieto and Energy Reform

Though legal battles are sure to continue, Mexico has chosen its next president. Enrique Peña Nieto will take office on December 1, and his party, the Institutional Revolutionary Party, or PRI, will dominate both houses of Congress. Domestic and international audiences are now looking to the next government to pass the structural reforms needed for Mexico to become more productive, more competitive, and grow faster. This starts with the state-owned energy sector. Enshrined in Mexico’s Constitution, oil reserves are property of the state, managed by PEMEX, which retains full, control over exploration, processing, and sales. A modest 2008 energy reform pushed on the margins of this arrangement, allowing Pemex to offer incentive-based service contracts to private firms. These new rules so far have disappointed, with few foreign companies substantially upping their foreign direct investment or bringing in technological know-how needed to unlock potential reserves and boost long term production. (source: Shannon K. O’Neil – CFR – 12/07/2012)

Though notoriously a political third rail in Mexico, during the campaign Peña Nieto promised to open up the sector to private investment, à la Brazil’s Petrobras. In a 2011 interview with Financial Times he claimed that Pemex “can achieve more, grow more and do more through alliances with the private sector”. He reaffirmed this position just this week when talking with the press, saying he was convinced PRI could reach an agreement on energy through “much negotiation” between his party and opposition. Can Enrique Peña Nieto open up the energy sector? Possibly. One consideration is PRI’s legislative heft. The party gained a plurality, but not majority, in both houses of Congress. Many commentators see this is worrisome for an ambitious reform agenda, predicting a weaker president, and continued gridlock. But energy reform was always going to require a coalition to create necessary two-thirds constitutional majority. The lack of a majority may make the PRI more willing to come to the bargaining table (and more willing to negotiate in other areas, such as political reform). If they come, they may find a willing partner in the outgoing National Action Party, the PAN. The PRI also has the advantage of counting on the PEMEX union as a political ally rather than an opponent. In fact, union’s leader, Carlos Romero Deschamps, was just elected to the Senate on the PRI’s proportional representation list, as was the union’s treasurer, Ricardo Aldana. Their presence, rather than stymieing negotiations, may help smooth the process, enabling a Nixon in China moment for Mexico.

Another pressure for reform is the reality of Mexican oil exploration and production. Mexico has huge potential, but increasingly recognized limits on PEMEX’s ability to realize these riches. Since 2004 oil output has dropped by roughly a quarter (stabilizing in 2010). Under the status quo many expect further declines, which are worrisome not just for the economy; oil revenues account for a third of the government’s budget. Even if production remains stable Mexico will likely become a net oil importer during Peña Nieto’s tenure. For a party that aspires to remain in power, unleashing additional revenues is vital. In 2008 Mexico passed a more moderate energy reform (many say that behind scenes Peña Nieto himself blocked a more comprehensive bill). Though disappointing in terms of its reach, it did put energy reform on the table, bringing politicians from across spectrum, interest groups, and society at large together to debate, discuss, and successfully revise a once sacred cow of Mexican politics. This precedent created space for contemplating a comprehensive reform today. Path to true change will require serious negotiations both within PRI and with other parties, most likely with the PAN but perhaps also with members of the Party of the Democratic Revolution, or PRD (some of whom voted for 2008 reform). In these few days since the election, both the president and his chief of staff, Luis Videgaray, have repeatedly placed energy reform as top of the agenda. Both know the challenges ahead. But, as the president elect says, “I’m optimistic”.

Link: http://blogs.cfr.org/oneil/2012/07/12/pena-nieto-and-energy-reform/

Acerca de ignaciocovelo
Consultor Internacional

2 Responses to Peña Nieto and Energy Reform

  1. El presidente Felipe Calderón (Morelia, 1962) abandonará la residencia oficial de Los Pinos el próximo 1 de diciembre. No aparenta disgusto por la derrota de su partido, Acción Nacional (PAN), en las elecciones ni por el regreso del PRI (Partido Revolucionario Institucional) al poder después de 12 años. Está satisfecho de su legado y convencido de que su estrategia contra el narco y su agenda de reformas continuarán (…..)

    (…..) Peña Nieto y el PRI parecen tener prisa por sacar adelante reformas de las se lleva hablando varios años (energética, fiscal, laboral…) ¿va a colaborar el PAN en esas reformas a sabiendas del boicot que el PRI le hizo a su Gobierno en este sexenio? Eso solo lo puede contestar el PAN y sus legisladores. Yo y el Gobierno de la República no solo colaboraremos si no que seguiré impulsando las reformas. Presenté una reforma energética en 2008, todavía están a tiempo de aprobarla, igual que la laboral y la fiscal… Muchas de esas reformas precisamente no se lograron por la obstaculización del PRI durante estos años y espero que esa actitud que ha sido nociva para la República pueda rectificarse (…..)

    (…..) Dado el número de muertos vinculados a la lucha contra el crimen organizado, de desaparecidos, de violaciones de los derechos humanos como han denunciado varias ONG, ¿teme ser llevado a la Corte Penal Internacional de La Haya? No, porque hemos actuado en todo momento con escrupuloso respeto a la ley. Ha habido una gran cantidad de homicidios en México, que por supuesto lamentamos, pero los que cometen esos homicidios son los criminales. Creo que la irresponsabilidad de un gobernante hubiera sido no haber actuado. Por otra parte, seguramente debe haber habido violaciones de los derechos humanos por parte de las Fuerzas Armadas y de la Policía. Pero estas han sido, excepcionales, no sistemáticas. De los miles y miles de operaciones que realizan las Fuerzas Armadas (patrullas, detenciones in fraganti, decomisos de droga…) los casos que se han llegado a denunciar son significativamente excepcionales. Y de los denunciados, según datos de la Comisión Nacional de Derechos Humanos, probablemente solo el 1,5% o 2% de las quejas han derivado en recomendaciones con fundamento. El ex presidente Vicente Fox ha asegurado que ha habido muchas violaciones de los derechos humanos…Pues si tiene constancia de ellas, debería ir a la autoridad a denunciarlas. ¿A qué atribuye esas críticas de Fox, él que sabe lo que implica gobernar? La verdad es no quisiera opinar de eso, ni siquiera estoy seguro de ese supuesto (…..)

    http://internacional.elpais.com/internacional/2012/07/14/actualidad/1342286287_360991.html

  2. (Autoria) Comentario del Prof. Uziel Nogueira: OJO! Calderón es mexicano y no es George W. Bush, norteamericano-anglosajón. Aun el tribunal de La Haya esta especializado en condenar dictadores africanos, un latinoamericano no sería totalmente inmune al tribunal.

    http://internacional.elpais.com/internacional/2012/07/14/actualidad/1342286287_360991.html

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