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september 14, 2012 • 05:11 PM

Mexico's Pena Nieto eyes trade, security ties in Latin America

Mexico's President-elect Enrique Pena Nieto speaks during a meeting with legislators of the the Institutional Revolutionary Party (PRI) to present initiatives on anti-corruption laws in Mexico City September 10, 2012.
Foto: Edgard Garrido / Reuters
 

Mexico's incoming President Enrique Pena Nieto will tour Latin America next week seeking to pave the way for deeper cooperation in the fight against drug gangs and stronger trade ties.

In his first major trip since Mexico's electoral tribunal confirmed him as president elect, Pena Nieto is to hold talks with leaders in Brazil, Colombia, Argentina, Peru and Chile after beginning his week's travels in neighboring Guatemala.

Pena Nieto takes office on December 1, at a time when Mexico is bucking an international economic downturn but still facing a major menace from violent drug gangs, which have killed tens of thousands of people during President Felipe Calderon's term.

Boosted by the economic tailwind, Pena Nieto wants to raise Mexico's profile on the world stage, which in recent years has been overshadowed by its larger southern peer Brazil.

"Looking at the Caribbean, Central America and South America, whose history and language we identify with, we need to find more opportunities for these countries to be present in Mexico, and for us to be present in them," Pena Nieto told a meeting of Mexico's top business leaders on Monday.

Pena Nieto's advisors stress that as the destination for more than 78 percent of Mexico's exports, the United States will remain the country's No. 1 foreign policy priority.

But Mexico has cut its dependency on U.S. demand by stepping up business with faster-growing regions like South America and China, and hopes to reduce it further still.

Mexico's exports to Latin America and Central America accounted for more than 7 percent of the total last year. In 2000, the figure was barely 3 percent.

SECURITY CONCERNS

Colombia, Chile, Mexico and Peru recently formed a bloc known as the Pacific Alliance which aims to deepen joint economic relations and strengthen trade with Asia.

That will form part of the talks Pena Nieto holds on his tour, while swapping notes on security will also be on the agenda in Colombia, which, like Mexico, has had to face down the menace posed by drug cartels.

Colombian crime fighter Oscar Naranjo is due to serve as a top security adviser to Pena Nieto in the next administration and they may meet on the trip.

Pena Nieto has pledged to continue a crackdown on the gangs launched by Calderon, promising to double security spending, expand the federal police and chase dirty money more vigorously.

Security will also be at the forefront of Pena Nieto's meeting with Guatemalan President Otto Perez on Monday. Mexico's southeastern border has been blighted by the brutal Zetas drug gang, which has spread its tentacles into Guatemala.

According to a tally kept by Mexican newspaper Reforma, a jump in drug-related violence in the state of Chiapas, which borders Guatemala, had by early September killed 184 people in 2012 - more than the previous six years combined.

Mari Isabel Mejicano, a Guatemalan political analyst, said she expected joint cooperation on security to be tightened.

"Ideologically, both presidents are similar," she said.

Perez has reinforced the border with extra troops and is planning to establish new military bases near the border.

FREE TRADE

Pena Nieto's longest official stop is scheduled for Brazil, where he is meeting former President Fernando Henrique Cardoso as well as business leaders on September 19. The following day he is due to meet President Dilma Rousseff.

Brazil was a darling of emerging market investors for much of the past decade, when its economy repeatedly outperformed Mexico's. That changed last year, and in 2012 Mexican growth is seen at around 4 percent - roughly twice the rate of Brazil.

Business lobbies are hopeful the two countries could take steps towards agreeing a joint free trade deal under Pena Nieto, after some 15 years of trying. However, after friction earlier in 2012, when Brasilia pushed Mexico into accepting a 3-year curb on its auto exports, it may still be some time away.

"We'll have to see the details of whether there could be a free trade deal or sectoral deals, but our view is that we need to look at how our economies can complement each other," said Emilio Lozoya, a foreign policy adviser to Pena Nieto.

The talks would aim to establish closer ties between Brazil and Mexico so that the two become more strategic allies rather than competitors, another official on Pena Nieto's team said.

Pena Nieto, 46, has cited Brazil's partly privatized state-controlled oil firm Petrobras as a model for revamping Mexican oil monopoly Pemex, and he faces a stiff challenge pushing that planned energy reform through Congress.

(Additional reporting by Mike McDonald and Anahi Rama; Editing by Richard Chang)

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