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Enron Mail |
Steve,
I am very happy for Mexico. There is no perfect candidate, nevertheless the positive impact of finally having a change in the party in power after 71 years is beyond our forecast ability. At last, we are going to have more checks and balances in the system with all the benefits that they will bring to the country to a more democratic way of doing things. Also with the checks and balances everybody will have to listen, respect and negotiate with others. It's going to be fun. For us it means: 1. A couple of weeks ago I had a meeting with a key Fox advisor and we will have the opportunity to participate in the design of their energy policies, and as you remember,last year I worked closely with a group of PAN legislators (close to Fox) in helping them draft aan alternative proposal for the reform of the electric sector. 2. The unions did not vote for the PAN and they are the main stronghold against energy reform. The PAN has no compromise with the unions. 3. Industrials have backed the PAN and since yesterday energy reform has been on Fox's agenda. He said he would not sell assets but that he would open the industry to private investment. You have to start somewhere. 4. We should work very hard this summer and try to participate in the 2000-2006 National Development Plan which is a government plan that the new administration is obligated by law to create and publicize. I will offer 100% of my time to help them develop the energy part tof the plan. 5. There are rumors that our friend Luis Tellez is staying as well as some of his undersectretaries. Hopefully Hector Olea will stay at the CRE as well. 6. In the medium term we could see lower interest rates for the Mexican economy. Since Sunday they are down more than 3 percentage points to around 14.7%. Hopefully in a couple of yeares we should be well below the 10% mark (depending also on the U.S. rates) In short, all is well south of your border. The long transition to democracy is over. Best, Ricardo Steven J Kean@EES 07/04/2000 03:26 PM To: Ricardo Charvel/NA/Enron@Enron cc: Subject: Mexico II -- Wrong and Proud of It! What do you think these electiion results are going to mean for us? Are you happy for Mexico? ---------------------- Forwarded by Steven J Kean/HOU/EES on 07/04/2000 03:11 PM --------------------------- Michelle Michot Foss <mmfoss@UH.EDU< on 07/03/2000 01:08:37 PM To: mmfoss@UH.EDU cc: Subject: Mexico II -- Wrong and Proud of It! Dear colleagues -- if bad predictions lead to contrary but more positive results, then I take full blame! Clearly, we underestimated the power of the opportunity to vote in private in Mexico yesterday, with a vote that actually mattered. We overestimated the vestigial effects of the PRI machine. Early reactions from our advisors and research colleagues in Mexico are strongly favorable (there is considerable Fox support among the group, and one of our advisory board members may return to active duty in the Fox administration). Their reactions are tempered with cautions: 1. The vote margin is indeed likely to narrow as final returns, especially from rural and southern states with heavy PRI or PRD influence, are produced today. It is still viewed as unlikely that Fox will have much to work with in the Congress, as the "PRI majority rule" is unlikely to fall to the PAN. But, we'll see. 2. After the excitement comes the problem of governance. Could Fox face the problem that Germany faced after WWII, or the FSU after break up? The knowledge and experience regarding federal affairs lies with those who served during the Salinas and Zedillo administrations, and thus who are associated with PRI governance. What appointments are likely to be made as a consequence? With no formal civil service, what "bumps" are likely to be felt in this historic transition? 3. On the issue of decentralization that I raised last week, the betting is that Fox as a former governor will indeed preside over a transfer of some, and perhaps considerable, power and fiscal authority from federal to state jurisdictions. 4. On the "housecleaning wish list" we can now add an item that Labastida would have been unlikely to pursue -- a vigorous effort to commercialize (but not privatize) the national energy companies. Unless there are surprises in the final vote tallies today (and this could happen) the feeling is that Fox will still be bound by campaign rhetoric and limited by lack of a PAN majority in Congress. But even if the attention these next six years were on getting things in order -- improved financial and accounting practices, establishing better capital budgeting processes (with the PRI-Pemex bond now broken, this long-time goal for Pemex could be realized), increasing transparency for operations, upgrading management skills and resolving environmental problems and disputes with landowners and state governments -- that would be a major improvement. But this will entail a major effort and significant culture shift within CFE and Pemex. Certainly, our malaise regarding our Mexico case study has lifted. Our activities for the remainder of the year should be quite exciting. Michelle Michot Foss, Ph.D. Director, Energy Institute College of Business Administration University of Houston Houston, TX 77204-6283 USA Tel. 713-743-4634 Fax 713-743-4881 www.uh.edu/energyinstitute
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