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Or bA,…/ JOSE GUADALUPE POSADA Tabasco blockade had the White House so jittery that two U.S. State Department investigators were dispatched from Mexico City to assess its impact. THE TABASCO STAND-OFF also poses an even larger problem for President Ernesto Zedillo. Not only did the possibility of default become an issue for Clinton’s Republican rivals in the U.S., the blockades also challenged Zedillo’s commitment to quickly privatize PEMEX’s petrochemical sector. Privatization, first proposed by Carlos Salinas in 1993, is mandated by the North American Free Trade Agreement. Bidding began in late October, following Zedillo’s announcement of auction dates at a U.S. Chamber of Commerce breakfast in Washington. The first sale is scheduled to be an-. nounced on April 26. Public responses to the privatization of Mexico’s petrochemical industries have included promises of open resistance and fiery speeches, and large marches on the fifty-eighth anniversary of Lazaro Cardenas’ expropriation of the oil industry. Cardenas’ son, Cuauhtemoc, founder of the Democratic Party of describes the sell-off as “a crime against the country [because] oil has always been the essential factor in our struggle for sovereignty.” The sovereignty issue is touchy: in a memorandum guaranteeing the International Monetary Fund’s seventeen-billiondollar share of the Mexican bail-out, Zedillo agreed to accelerate the time table for the PEMEX-Petroquimeca sale. Unionized oilworkers and non-union technicians vehemently oppose the sale. In a public referendum conducted in the southern Veracruz petrochemical nexus of Minititlan last October, “No Sale” prevailed by a forty-two thousand-to-three hundred vote. Privatization is also termed unconstitutional by Cardenas and a host of prominent juristsbecause the constitution delegates to the nation “dominion over basic petrochemicals.” The Zedillo administration has responded with an attempt to reclassify the remaining eight basic petrochemicals as secondary by-products, thereby avoiding politically complicated constitutional change. PEMEX is offering sixty-one petrochemical plants, grouped in ten complexes, and the sale is organized by the Wall Street brokerage firm, J.P. Morgan. In 1994, PEMEX Petroquirnica turned $1.4 billion in sales and the Mexican government hopes to get four billion dollars for the aging plantsthough market watchers calculate that something closer to two billion is more realistic. Carlos Romero Dechamps, head of the oil workers union that the plants are worth between eighteen and twenty billion dollars because buyers will also get PEMEX’s national and international markets. Such mega-corporations as Shell, British Petroleum, Exxon and Chevron are said to be in the competitionseveral may buy in just to get a foothold in future privatization of PEMEX oil-and-gas exploration. PEMEX insists it is not going private and that all revenues from petrochemical sales will be plowed into its essential missiondiscovering and drilling crude oil. Nonetheless, in addition to its petrochemical plants, PEMEX is privatizing natural gas distribution, has signed sub-contracts with Texas off-shore drillers, and shares a refinery with Shell. Those who follow the trade say that Energy Secretary Jesus Reyes Heroles wants PEMEX removed from national and local budgetsthe nationalized corporation returned seventyseven percent of its revenues to the state last year, largely for social projects. Reyes Heroles wants to run PEMEX like a private corporation, reinvesting its own revenues to ensure future reserves, says Gray Newman, an analyst for a prominent foreign bank operating in Mexico. Brazil, Peru, Argentina and Peru are similarly privatizing former state-owned petroleum monopolies. MANY OF THE PIPELINES that weave a deadly web around Platano y Cacao snake east across the state line to Coatzacoalcos, Veracruz, where four major complexes produce eighty-eight percent of Mexico’s petrochemical supply. Much as in Tabasco, the quality of life nearby has been irretrievably degraded. Across the highway from the rusting Pajaritos plant, a yellow smoking ditch runs through the community of Sapo, where fruit aborts on the branch, children suffer frequent nosebleeds, and sirens wail at all hours. For years the government has promised to move the farmers out from under Pajaritos’ lethal pall and recently activists from Greenpeace Mexico docked their “Moby Dick” cruiser at Pajaritos and strung up banners demanding a clean-up of the complex. Pajaritos will also be sold next yearalthough in its damaged condition, there may be few takers. First on the block in April is the Cosoleacaque complex, built in 1962, which produces eighty percent of Mexico’s ammonia. Cosoleacaque is as dangerous a powder keg as Platano y Cacao; on January 30, an ammonia leak at an animal feed plant, ironically named “Ecology & Associated Resources,” killed five and poisoned twenty. But the sale of Cosoleacaque presents other problems, Romero Dechamps recently told a congressional commission. Ammonia is used to make fertilizers essential to feeding the nation one ton of fertilizer equals seven tons. of basic grains. Handing over the plant to transnationals constitutes yet another loss of sovereigntyor at least control of the nation’s_ food supply, argues the union leader. Two transnational corporations \(Mexican competitors are virtually eliminated by the bidding complex. What could stall the privatization steamroller is the cost of the environmental cleanup, a task that could add hundreds of millions onto the price tag. PEMEX says it will clean up to the date of the sale, and the buyer is responsible for completing the job. An environmental audit last year resulted in one thousand three hundred ninety-six cleanup recommendations and, with only a month until the first sale of a petrochemical plant, PEMEX has barely complied with twenty-seven percent of the complaints cited in the audit. Who will clean up PEMEX’s mess? Probably no one, figures Newman, the author of a book on Mexican environmental law for investors. Newman believes privatization will mean a cleaner industry. When secondary petrochemical plants, such as Fertimex, were sold in 1992, Newman recalls, the government gave the buyers a list of minimal improvements to be made, and simply absolved PEMEX of all other past crimes against the environment. THE TEXAS OBSERVER 13 ,A1.0.44.1111,14.e.