LATIN AMERICA

Mexico City’s former mayor challenges Peña Nieto to debate Pemex reforms

President tells ‘Financial Times’ constitutional changes are needed to denationalize oil sector

Marcelo Ebrard, former Mexico City mayor.
Marcelo Ebrard, former Mexico City mayor. PEP COMPANYS

Mexico City’s former leftist mayor, Marcelo Ebrard, has challenged President Enrique Peña Nieto to a debate next Tuesday night over his government’s plans to open the state-owned petroleum firm Petróleos Mexicanos (Pemex) to foreign investors.

In a letter addressed to the president on Thursday, Ebrard said that public discussions over Pemex’s future were urgently needed. “There is no reason to wait two months to meet and share our ideas, unless you consider that your party may be affected by the upcoming elections,” the former mayor wrote.

Local elections will be held on July 7 in 14 states.

The controversy between Ebrard, of the Revolutionary Democratic Party (PRD), and Peña Nieto, of the Institutional Revolutionary Party (PRI), began brewing after the Mexican leader was quoted in the June 17 edition of the Financial Times saying that his energy reform would include “the constitutional changes needed to give private investors certainty.”

Mexico nationalized its oil industry in 1938 under President Lázaro Cardenas. Oil and other natural resources are listed in Article 27 of the Mexican Constitution as belonging to the state.

Ebrard, who served as mayor of Mexico City from 2006 and 2012, and is considered one of the country’s most progressive leaders, told EL PAÍS in an interview published Thursday that he realizes that Pemex “needs to modernize” and that structural changes must take place.

For many years investment in Pemex has been put off because no one wanted to undertake tax reforms"

“For many years investment in Pemex has been put off because no one wanted to undertake tax reforms, but I don’t think that the solution lays in changing our nation’s collective-ownership rules concerning oil.”

Peña Nieto has proposed a package of reforms that include opening the petroleum industry to private investment, introducing a pensions system for all Mexicans, changing the tax code, restructuring the educational and judicial systems, and reorganizing law enforcement. As soon as Peña Nieto took office in December, the PRI, PRD and the National Action Party (PAN) signed a historic agreement to push through these reforms in the next six years under what is known as the Pact for Mexico.

However, Ebrard has complained that Peña Nieto has not shared the details of many of his proposals with the PRD, including the changes to the protectionist clause in the Constitution.

PRD president Jesús Zambrano told EL PAÍS in an earlier interview that he was willing to at least open discussions with Peña Nieto over changing Article 27.

“I wouldn’t be willing and I don’t agree with him,” Ebrard said in reply. “Article 27 and Pemex are very important reference points for many of Mexico’s leftist sectors for reasons of conviction. As of now we don’t know anything about Peña Nieto’s proposal, and for us it is a very bad sign that he has made this announcement while in London.”

The former mayor explained that the PRI would need the PRD’s votes in Congress to pass the proposal, and also acknowledged that Peña Nieto’s party could accomplish this with PAN votes, but that would then “break up the pact.”

Ebrard said that his party would be finished if the PRD splits on the issue.

“Approving changes to Article 27 is the beginning of the end of the PRD because no one has even been consulted on this. Today, there is a crisis of confidence inside the party,” he said.