Energy Referendum Debate Ignites in Mexico

Power to the People

President CalderÌn is facing new tests to his democratic record as the PRD pressures the head of state to allow voters to decide on whether to open the state-run energy sector to foreign investment. Mexico does not have a tradition of calling referenda, but there remains a legal provision allowing the president to do so. Senate Energy Commission Chief Graco Ramírez, a PRD member in the upper house, told press that President CalderÌn has the power to establish a legal mechanism within the Federal Electoral Institute to permit a plebiscite to take place (Article 26 of the Constitution). The legitimacy of such a measure is unclear, however, given the lack of precedent. Congress is clearly without the capacity to call a popular vote of this kind under current legislation. AMLO proposed late last month that the government hold a referendum on 27 July to determine the future of energy reform. Demonstrating the left-leaning party’s power in the capital, Mayor Ebrard has already set the same July date for a plebiscite on proposed reforms to state energy firm PEMEX. Estimated costs of consultation in the capital stand at 2 million pesos (US$194,000), according to members of the local legislature. As an alternative to a national vote, in the event that President CalderÌn resists, state-level referenda could be held across the country. Political differences between governors from rival parties present a potential barrier.

Ramírez published the following proposed questions to put to the electorate.

• Should PEMEX be privatised or maintained as a public company?
• Should PEMEX’s resources should be spent only on PEMEX or be shared with other areas of government?
• Should energy policy be defined by the government alone or in a collective manner [in consultation] with a group of technicians?

Parallel Pressure in the Security Arena

The ruling National Action Party (PAN) is facing a difficult period in office amid spiralling drug-related violence. Mexico is attracting unwanted international attention amid executions presumably carried out by rival drug gangs, with senior police officers and public prosecutors, being targeted regularly. The only positive outcome is the potential receipt of enhanced anti-drugs aid from the United States, but the overall effect of violent crime on efforts to attract foreign investment are unfavourable (see Mexico: 30 May 2008: U.S. and Mexican Governors Meet over Crime Concerns). President Calderon has made his security crackdown the flagship of his government meaning that his party could be punished at the polls in 2009 for its perceived failure. Former PAN president Manuel Espino, a fierce critic of the current head of government, gave a press conference yesterday in which he refuted claims that the Mexican state is in any way winning the war on drugs. The situation in Chihuahua state is particularly worrying with violence centred on the border city of Ciudad Juárez, close to the United States. The authorities confirmed yesterday that 14 people were murdered in a 24-hour period. All of the deaths were linked to organised crime, according to initial investigations by the public prosecution service. Mexican Foreign Secretary Patricia Espinosa pledged “solidarity and collaboration” with Latin American colleagues fighting the illegal drug trade, as she addressed the 38th session of the Organization of American States (OAS)’s General Assembly yesterday.

Outlook and Implications

Mexico’s political classes are beginning to focus on the 2009 legislative contest, which usually spells stalled progress in Congress. Lawmakers have so far failed to reach a consensus on government-proposed measures to help PEMEX reverse falling production. The debate is fuelled by nationalism, with the PRD fanning the flames. In other contexts, a referendum could represent a potentially favourable solution; however, the issue of energy reform is deeply politicised in Mexico, apart from being technically complicated.

A late July polling day would not provide enough time for a public information campaign. The process would be complicated further by AMLO and his supporters putting out a populist “no” campaign and taking to the streets once again. Legal barriers to a plebiscite remain, probably delaying a debate and a vote on the matter. Congressional proceedings would be disrupted in the event of lawmakers seeking reforms to allow them to call a referendum themselves. There are parallel concerns that AMLO and radical sections of the PRD at large would refuse to recognise a “yes” vote reviving the bitter dispute over Mexico’s 2006 presidential vote. The CalderÌn administration finds itself in a “Catch 22” situation again as, by resisting a popular vote, it will be giving AMLO ammunition for his claim that the government represents only elite interests and is trying to trick the populace out of its collective birthright: an energy sector that belongs to Mexico.

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