mead cohen berger shevtsova garfinkle michta grygiel blankenhorn
Peña Nieto to Push Constitutional Energy Reform Next Month


Mexico’s state-owned oil and gas monopoly, Pemex, is a terribly run organization. It has added 22,000 jobs since 2004, yet production has fallen 23 percent. Mexico’s government uses Pemex as its own personal piggy bank, deriving roughly a third of its revenue from the company. That leaves few pesos left over for Pemex to reinvest in new projects and infrastructure, making the company into the Red Queen: running very hard to stay in place.

Reform-minded President Enrique Peña Nieto has eyed changes to Pemex. He is set to announce an amendment to Mexico’s constitution in August to open up the country’s outsized oil and gas resources to private and foreign investment (Mexico has the world’s sixth-largest shale gas reserves and eighth-largest shale oil reserves).

These reforms won’t be as popular as outsiders might expect them to be. Many Mexicans take deep cultural pride in the nationalization of their country’s oil and gas reserves. But nationalistic yearnings aside, these reforms are vital for our southern neighbor if it is to achieve its potential as a new global manufacturing powerhouse.

[Image of President Nieto at 2010 WEF courtesy of Wikipedia]

Features Icon
show comments
  • bigfire

    Good luck. I don’t think it’ll pass. But good luck anyway.

© The American Interest LLC 2005-2016 About Us Masthead Submissions Advertise Customer Service