American Media Misses the Story on Mexican Oil Reform
On Dec. 12, 2013, Mexican legislators approved controversial, far-reaching reforms to the country’s energy sector. Outside the federal legislative chambers in Mexico City, protesters pounded on metal barriers with rocks and spoons, while phalanxes of riot police stood guard behind the barricades. Many felt their country’s patrimony and fiscal independence were being sold at a fire sale. Mexico was opening up its energy sector to private, foreign interests for the first time since President Lazaro Cardenas had tossed out foreign companies and nationalized oil reserves to wide and enthusiastic support in 1938.
For the past 75 years, Mexican oil has been controlled exclusively by the state-owned oil firm Pemex, the second most profitable company in Latin America, according to the Fortune 500 index. Almost all of Pemex’s profits go back into national coffers. But the state-owned company is also notoriously corrupt. One of the figures most associated with corruption at Pemex is its longtime union leader, Carlos Romero Deschamps. His daughter sparked a scandal in 2012 by flaunting her inexplicably opulent lifestyle on social media. Romero Deschamps has led the oil workers union since he was appointed to the position more than 20 years ago by then-president Carlos Salinas de Gortari. But good luck charging him for his alleged crimes. As a senator for the ruling PRI party, Romero Deschamps enjoys immunity from prosecution under a shield law for elected officials known here as fuero.
Then there’s Francisco “Pancho” Colorado, who was tried, convicted and sentenced in Austin for his role in a Zetas money laundering operation. Colorado became wealthy as the head of an oil services company that received lucrative contracts from Pemex. An FBI agent testified in federal court in Austin that informants said Colorado received multi-million dollar contracts with Pemex in exchange for acting as an intermediary between a former governor of Veracruz and a founder of the Zetas cartel.
But energy reform, as passed, does virtually nothing to remedy corruption within and surrounding the state-run company. As often happens to public companies ahead of a push to privatize or denationalize, Pemex was portrayed as an ailing dinosaur of a monopoly whose only hope is an injection of private capital into the sector it has dominated for decades.
More at http://www.texasobserver.org/american-media-misses-story-mexican-oil-reform/ .
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