Pena Nieto Confident 75-Year Pemex Oil Monopoly to End This Year

Angelica Rivera (Flickr)Bloomberg, 6/18/2013

Mexican President Enrique Pena Nieto said he’s confident Congress will end the state oil monopoly this year, opening the way for companies such as Exxon Mobil Corp. and Royal Dutch Shell Plc to tap the nation’s reserves. In the model envisioned by Pena Nieto, state-owned Petroleos Mexicanos would develop some fields, while others are tapped by foreign and private companies. He declined to discuss more details of the proposal, or whether it would require a change in the constitution.

Seven decades after his party seized fields from the predecessors to Exxon and Shell, Pena Nieto is preparing for the return of international oil companies to arrest eight years of decline in crude output. An opening would probably be broad, from offshore drilling to shale fields similar to those that have revived the U.S. petroleum industry, Pena Nieto said. “It’s obvious that Pemex doesn’t have the financial capacity to be in every single front of energy generation,” the 46-year-old president said in an interview in London yesterday, before traveling to Northern Ireland for meetings with Group of Eight leaders. “Shale is one of the areas where there’s room for private companies, but not the only one.”

Read more…

OP-ED: Mexico’s Lucky to Have Just One Man Blocking Internet Equality. We’ve Got a Bunch

carlos slimWired, 5/13/2013

Loud laughter greeted Slim’s early remarks, and within a few minutes a major nonviolent protest erupted: kazoo-playing audience members trooped around the giant hall and left the building after flinging multicolored pieces of monopoly money into the air.

What was printed on that money? It bore the legend “$73 Billion Net Worth By Price Gouging & Overcharging.” And that’s when I realized that this moment represented a turning point: Monopoly communications industry behavior may finally become socially interesting in America. There are just a few steps between what’s happened in Mexico and what’s going on here in the United States.

Read more…

Can reform save Mexico’s oil industry?

Oil barrelsSmart Planet, 3/27/2013

Mexico owns a gold mine of oil, much of it just out of its reach. The country’s national oil monopoly, Petroleos Mexicanos, lacks the technology and expertise to drill the deep waters of the Gulf of Mexico, where its latest oil finds lie. Historically, its hands have been tied: A prohibition on foreign partnerships and inadequate reinvestment in the business have prevented the company known best as Pemex from venturing beyond its shallow fields into the deep.

But the energy reform currently under debate could change that, opening Mexico’s oil sector to foreign investment –- if the new government can amass the legislative support it needs and surmount substantial public opposition.

Read more…

Carlos Slim Praises Mexican Telecom Reform Despite Challenge To His Number One Billionaire Status

carlos slimForbes, 3/18/2013

Tycoon Carlos Slim, who is in danger of losing his title as the world’s richest man,  praised the new monopoly-busting telecom legislation proposed by the Mexican government despite the fact that it has significantly reduced his net worth.

“This telecommunications law addresses the importance of broadband and of having more penetration…   Therefore, without a doubt,  it coincides with everything this commission has sought: universal service, better prices, higher speeds and convergence,”  Slim said  following the  inauguration of the Seventh meeting of the United Nations Broadband Commission for Digital Development in Mexico City March 17.  It was the first time Slim personally addressed the bill since it was proposed on March 11.

Read more…

Mexico’s road to economic sanity

Photo by Flikr user LyfetimeFortune, 3/15/2013

With a bill introduced by the president and backed by all three political parties, Mexico is poised to take on a few of the country’s biggest monopolies and moguls. But for Mexico to truly engage in economic competition, it needs to do much more.

A lack of competition pervades the Mexican economy, as one or a few companies dominate sectors as diverse as glass, cement, flour, soft drinks, sugar, and tortilla flour, not to mention the state’s control of energy and electricity. This hits consumers’ bottom lines — an OECD study estimates that it increases the costs of basic goods for households by some 40%. It hurts Mexico’s working and middle classes the most, as they must spend a larger proportion of what they earn on these goods and services. It also hits the burgeoning manufacturing sector, which has to pay more for raw materials and basic inputs.

Read more…

Mexico’s leftist opposition rallies against energy reforms

PRD logoReuters, 3/17/2013

Waving party flags and shouting their support, tens of thousands of leftist party members rallied on Sunday against government plans to overhaul Mexico’s energy sector, a preview of the tough road ahead for President Enrique Pena Nieto’s reform push. Organized by the leftist Party of the Democratic Revolution, or PRD, the rally took place on the eve of the 75th anniversary of the nationalization of the country’s oil industry, the historical pivot that gave birth to state oil monopoly Pemex.

Speakers denounced any move to privatize the government-run oil giant, even though Pena Nieto and other members of his centrist Institutional Revolutionary Party, or PRI, have consistently denied any plans to sell or privatize Pemex. “We are being loyal to this historical legacy that has given our oil riches to the nation and we are going to defend it with everything we’ve got,” said Jesus Zambrano, the PRD’s national president, to rousing applause.

Read more…

Mexico Goes After Its Monopolies

using smartphoneThe Wall Street Journal, 3/11/2013

The monopoly powers of two of Mexico’s richest businessmen, one being Carlos Slim, are coming under fire with a broad set of new laws that aim to open up the telecommunications and television businesses to competition.

The plans, announced on Monday by the president, are aimed principally at Mr. Slim’s telephone giant, América Móvil SAB, and Mexico’s leading broadcaster, Grupo Televisa TLEVISA.MX , which each control 70% of their respective markets. The proposal calls for the creation of a new telecommunications regulator that would be able to order asset sales by companies that dominate a market, and limit companies’ ability to stall competition through endless litigation.

Read more…