MINING IN MEXICO — PRI returned; Zedillo is president-elect

A new Mexican president was elected this summer and his party, which has ruled the country for the past 65 years, kept a solid majority in both houses of the General Congress.

In the presidential vote, election officials said Ernesto Zedillo of the Institutional Revolutionary Party (PRI) won with 48.8% of the Aug. 21 vote, the first time in modern Mexican politics that a candidate was elected with less

than 50%.

Rival Diego Fernandez de Cevallos of the conservative National Action Party (PAN) received 25.9% of the vote, while Cuauhtemoc Cardenas of the center-left Party of the Democratic Revolution (PRD) captured 16.6%. The Federal Electoral Institute said PRI won 64 seats in the Senate to 24 for PAN and eight for PRD.

With holdovers from 1991, the 128-member Senate will have 95 members of PRI, 25 from PAN and eight from PRD.

PRI also dominates membership of the 500-member Chamber of Deputies. Some 35,550,283 votes were counted in some 300 districts around the country, putting turnout at more than 77%, the Federal Election Institute reported. Mexico’s abstention rate is usually about 50%.

Cardenas had sought to slow implementation of outgoing President Carlos Salinas de Gortari’s economic reforms, especially the North American Free Trade Agreement with Canada and the U.S.

A pro-reform group set up by Mexico’s Zapatista rebels called for annulling the presidential election, charging the vote that handed the ruling party a narrow victory was marred by fraud.

The National Democratic Convention created by rebel leader “Subcomandante Marcos” said the vote was full of irregularities and that there was substantial proof that PRI “committed serious fraud”.

“The fraudulent electoral process was possible thanks to the existence of the ruling party which controls the mechanisms and the electoral process and powerfully manipulates the will of the people,” the group said in a statement. PRI’s victory in the governor’s election in Chiapas — where the Zapatistas launched a surprise New Year’s Day uprising — was also the result of fraud, the group charged.

Opposition leaders and some civic groups said they found evidence that the party rigged the vote.

Meanwhile, President Salinas welcomed a call from PRD for a “national dialogue” that would include the government.

PRD, particularly Cardenas, had refused to open talks with the government, charging that PRI won the last presidential vote in 1988 through electoral fraud.

Most international observers said there were scattered problems during the election, but not the systematic fraud that often has been charged in past Mexican elections.

A preliminary report issued by a delegation organized by the U.S.-based National Democratic Institute for International Affairs and International Republican Institute indicated that the vote was largely clean. Still, U.S. Senator John McCain, an Arizona Republican and a leader of the delegation, said Zedillo received disproportionate television coverage, a critical point since most Mexicans do not attend secondary school. A former budget minister, Zedillo, 42, was part of the economic brain trust that slashed the budget deficit and tamed inflation even though the average Mexican’s purchasing power fell by 60% in the past 12 years. Although expected, Zedillo’s victory pushed the Mexican stock exchange to its highest point in six months.

The political victory of Zedillo, expected to bolster a recovering economy, is firming up the resolve of more U.S. businesses to move south ofthe border. Some Houston businesses that specialize in trade with Mexico reported seeing more interest from clients shortly after the election.

“Projects were lined up beforehand, and now they have the green light,” said Vidal Martinez, a partner in the Houston law firm of Hughes and Luce, and chairman of its international practice group.

However, some observers of Mexico say business people may be a bit too optimistic. Mexico’s economy still is in a recession, and President Salinas will be a lame duck till the end of his term in December.

Guerrilla groups still operate in Chiapas state, and a series of kidnappings of prominent businessmen have made some foreign executives feel jittery. The Zedillo victory culminates a turbulent year, which began with an Indian uprising by the Zapatistas in the state of Chiapas and included the assassination of Zedillo’s predecessor, presidential candidate Luis Donaldo Colosio. Mexico has seen a peso devaluation at the close of each of the last three presidential terms, and a number of observers say Mexico must adjust the peso this year to help correct its balance-of-trade deficit. The threat of overvaluation of the peso will be strong once foreign investment begins to flow back into a more stable Mexico. “What we don’t want is artificial revaluation through capital inflows,” one analyst said. In late September, PRI’s secretary general, Jose Francisco Ruiz Massieu, was assassinated in downtown Mexico City.

— From the news wire services of Agence France Presse and Knight-Ridder.