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Energy
CFE, Four Companies Sign Agreement To Generate 163MW At Tehuantepec
August 29, 2007
The Energy Ministry (Sener) said that CFE has signed agreements with four firms to develop aeolian energy projects that will generate 163MW on the Tehuantepec Isthmus, in the state of Oaxaca. Under the agreement, Electricidad del Valle de Mexico, Eoliatec del Istmo, Bii Nee Stipa Energia Eolica and Fuerza Eolica del Istmo must use CFE's transmission infrastructure and pay for the required infrastructure to connect the National Electric System. The projects are expected to attract investment amounting to USD 3 billion in three years and have an overall capacity of 2GW. This agreement completes a program under which CFE signed similar agreements with Prenial, Union Fenosa, Cemex-Euro and Iberdrola.
LFC Unable To Provide Power To Developers
August 27, 2007
State power firm Luz y Fuerza del Centro (LFC) has warned Mexican home builders and developers of a lack of infrastructure in the Mexico City metropolitan area. The company does not have the substations and distribution circuits to attend to growing demand and has had to cut supply, primarily to housing development companies such as Homex, Urbi and Demet. Developers can complete a project for 10,000 homes in six months, but LFC is unable to construct a substation in that time. LFC plans to invest MXN 3 billion in substations from 2007-2012.
Pemex To Sell Emission Credits To Carbon Solutions
August 27, 2007
Pemex has signed a letter of intent to sell carbon credits for 49,000 tons a year (t/y) of greenhouse gas emissions to environmental consulting group Carbon Solutions' Mexican division. Pemex will reduce emissions from the boilers at the Miguel Hidalgo refinery in Tula, in the state of Hidalgo. Pemex has signed agreements this year to reduce a total 679,000t/y in emissions; among the companies with whom Pemex has signed the agreements are Norway's Statoil, France's BNP Paribas, and the U.K.'s EcoSecurities Group.
Pemex Launches Two Five-Year Tenders For Offshore Installations
August 31, 2007
Pemex Exploracion y Produccion (PEP) has launched two tenders for the five-year maintenance of offshore installations; the final day to acquire bidding rules for the first tender is October 17 and some USD 24.6 million have been allotted for the installations through the current budgetary year. The second tender's final day to acquire bidding rules is October 25 and some USD 29.21 million have been assigned for the installations, also through the current budgetary year.
Pemex Opens Tender For Marine Oil Drilling, Plans Hydrocarbons Registration
August 30, 2007
Pemex has opened a tender for directional drilling in the Gulf of Mexico. The tender involves exploration wells, development wells and repairs to existing wells; it also includes specialized drill bits that can penetrate difficult rock layers on top of the oil fields. Interested bidders have until September 12 to register for the tender. PEP has also launched two international tenders to quantify hydrocarbons in the same region; bidders can acquire bidding rules through October 2.
Three Interested In Pemex Marine Well Evaluations
August 30, 2007
The Mexican divisions of multinational oil services providers Halliburton, Baker Hughes and Dowell Schlumberger attended the question-and-answer session hosted by Pemex Exploracion y Produccion (PEP) for the tender to evaluate production wells in marine locations offshore from the city of Campeche, in the state of the same name. Evaluations are designed to quantify reserves and optimize marine output through several techniques of data gathering and interpretation. Bids will be received on September 24; nearly USD 95 million have been budgeted for the evaluations through the end of 2007.
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Mining
Grupo Mexico Asks Police To Reopen Cananea Mine, Freezes Talks With Strikers
August 28, 2007
Mexican mining company Grupo Mexico (GM) said negotiations with the striking National Mining-Metalworkers Union (STMMRM) were off and urged police to reopen the Cananea copper mine and to protect workers who refuse to support the strike. The Labor Ministry said GM has offered a minimum 4% wage increase and a 2% boost to benefits packages; however, the union denies such an offer has been made. The company says it still has sufficient mineral stocks to keep meeting contracts, but it has warned clients contracts may be broken if the strike drags on.
Gold Production Increases By 86.4%
August 29, 2007
According to The National Statistics Institute (Inegi) gold production during May increased by 86.4% compared to April and amounted to 3.41 tons valued at MXN 793.5 million. From January to May, gold production reached 15.79 tons, a figure that represents a 43% increase compared to the like 2006 period and is valued at MXN 3.6 billion. The production hike is due, among other reasons, to the beginning of operations of new gold mines located in the states of Guerrero, Durango and Sonora.
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Business & Industry
Mexichem Restructures Debt With USD 635 Million Bank Loan
August 29, 2007
Mexican chemicals concern Mexichem said it obtained a USD 635 million, five-year syndicated bank loan which it used to pay off a bridge loan taken out to finance acquisitions. Mexichem said the syndicated loan carries interest of 0.875 percentage point above Libor, includes a one-year grace period, and principal payments every six months. Citigroup was the lead placement agent and 14 banks participated in the loan. Mexichem had taken out debt to finance the acquisition of Petroquimica Colombiana and Grupo Amanco.
Peñafiel Eyes U.S. Market
August 31, 2007
International confectionery and beverages company Cadbury Schweppes announced that the Mexican soft drinks brand Peñafiel entered the U.S. market through six cities that include Dallas, Chicago, Los Angeles, Houston, Phoenix and Sacramento. The soft drinks company Peñafiel was founded in 1928 in the city of Tehuacan, in the state of Puebla.
Benavides Plans To Open New Stores
August 29, 2007
After being acquired by Chilean group Fasa, Mexican drugstore Farmacias Benavides said it will open 100 stores a year, beginning in 2008, in the 16 states where they already operate. Benavides said it would invest over MXN 400 million to open the drugstores. The company also said that it expects to expand operations in new states in 2009.
Russia Supports Sarkozy's Proposal To Include Mexico In G8
August 28, 2007
Russia supported French President Nicolas Sarkozy's proposal to broaden the eight most industrialized countries group (G8) by including five new members which include Mexico, Brazil, China, India and South Africa. The G8 group's current members are the U.S., Canada, the U.K., France, Germany, Italy, Russia and Japan.
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Automotive
Spanish CIE Automotive Acquires Duroplast Plant For USD 31.2 Million
August 28, 2007
The subsidiary of Spanish car components manufacturer CIE Automotive, CIE DESC, has entered into an agreement to acquire a plant in Mexico from local group Duroplast. The plant manufactures plastic injection molding components and joints for the automotive industry; it is located in Ramos Arizpe, in the state of Coahuila. The operation is worth USD 31.2 million including debt. CIE DESC Automotive is a 50/50 joint venture with the Mexican component manufacturer KUO. The agreement is subject to approval from the relevant competition authorities.
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Housing & Mortgaging
Fadesa To Invest USD 70 Million In Guanajuato
August 28, 2007
Spanish property company Fadesa will invest USD 70 million to build the Santa Margarita Hacienda Residencial development, which is its first property development in the state of Guanajuato. The project will have 198 houses, a 100-room hotel featuring a boutique, a spa, and a club house to provide other services.
Homex To Build Vacation Homes In Acapulco; Cancun And Ensenada To Follow
August 29, 2007
Mexican homebuilder Homex will invest over USD 40 million to begin building vacation homes in Acapulco, in the sate of Guerrero. Homex's strategy to enter into the vacation home sector is being implemented in that coastal city via a housing development called Banus Club Residencial. Homex said it is to follow the Acapulco project with similar developments in Cancun in the state of Quintana Roo, and in Ensenada in the state of Baja California.
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Construction & Infrastructure
OHL Begins Construction Of EUR 530 Million Highway
August 30, 2007
Spanish construction company Obrascon Huarte Lain (OHL) began the construction of a EUR 530 million toll road in the State of Mexico (Edomex). It consists in the second and third phases of a 59-kilometer segment that is scheduled to open at 2009-end. OHL is one of the most important construction companies in Spain; its main activities are residential and civil construction, infrastructure concessions and services.
ICA Approves USD 550 Million Share Offer
August 31, 2007
Mexican engineering and construction company ICA said that shareholders approved a USD 550 million capital increase through the issuance in Mexico and abroad of up to 90 million shares. ICA said shareholders also authorized the board of directors to choose the timing of the share issuance over a 12-month period starting in September, depending on the company's working capital requirements. ICA said the money from the new shares will be used to finance existing and potential infrastructure projects and to acquire land reserves for housing construction, debt repayment, and other purposes.
DF Earmarks USD 202 Million For Highway Projects
August 31, 2007
Mexico City's (DF) Works and Services Department head Jorge Arganis Diaz said the (DF) government plans to invest a total of USD 202 million for 94 separate highway projects this year. The funding will go toward the construction of four highway overpasses, 26 pedestrian bridges, 47 rehabilitation projects, three roadways, and 10 highway studies and project plans.
Chavez Orders Cemex Inspection
August 28, 2007
Venezuelan President Hugo Chavez ordered an environmental inspection of a plant owned by Mexican cement maker Cemex after residents complained about pollution produced by the mentioned firm. Chavez appointed a commission to study the effect of the plant on farmers in the eastern Venezuelan state of Anzoategui and to come up with a plan of action. Chavez has threatened to expropriate cement companies that don't cooperate with price controls and has said he won't allow producers to trigger local shortages by boosting exports.
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Transportation
U.S. Court Denies Teamsters Request To Block Mexican Trucks
August 31, 2007
The 9th U.S. Circuit Court of Appeals denied a request made by the Teamsters union, the Sierra Club and the nonprofit Public Citizen to halt the Bush administration's program to allow as many as 100 Mexican trucking companies to freely haul their cargo anywhere within the U.S. for the next year. The appeals court ruled the groups have not satisfied the legal requirements to immediately stop what the government is calling a "demonstration project," but can continue to argue their case.
Officials Request Permission For Nuevo Leon-Texas Railroad
August 30, 2007
Officials from the state of Nuevo Leon, Texas municipality Laredo and the municipality's Condado de Webb district have requested permission from the U.S. state department for an international railway project. The cost of building the railway - which would encompass 56km on the Mexican and 15.5km on the U.S. side of the border, connected by an international bridge - is expected to reach some USD 275 million. The project already has the support of Texas senators and other authorities. If the required permits are received, officials will look for the best way to finance the project, which would possibly include a combination of public and private funds.
SCT To Invest MXN 5 Billion In Railway Security
August 28, 2007
The Communications and Transport Ministry (SCT) said that it plans to invest MXN 5 billion in railway security programs during the current administration, to end 2012. SCT expects to reinforce the railway sector development by ensuring the safe transportation of merchandise all along the Mexican railways. The head of the rail workers union (STFRM) said that if the government manages to guarantee that Mexican railroads are secure, the demand for railway transportation of merchandise would increase by 40%.
Siemens To Begin Production Of 500 Electric Buses In November
August 29, 2007
German consortium Siemens along with local and foreign firms such as Division Equipo Electrico, Enersys and Electrovaya will begin in November the production of 500 electric-energy fueled buses for public transportation in Mexico City (DF). The cost of the buses could vary between MXN 900,000 and MXN 1.4 million. The vehicles will be manufactured at Mexican truck maker Dina's facility at Ciudad Sahagun, in the state of Hidalgo. The buses' engines are expected to last one million kilometers.
Aeromarmi Is First Mexican Aircraft Assembler
August 29, 2007
The recently created Aeromarmi is the first Mexican firm to build airplanes. Aeromarmi will produce double seater aircrafts that will be sold at USD 90,000 in the local market. The company expects to create a strong aeronautical industry that is capable of competing with foreign airplane makers; currently, aeromarmi expects to sell planes to several ministries among other potential clients.
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Telecommunications & Technology
America Movil To Invest USD 250 Million To Expand Coverage In Guatemala
August 29, 2007
Mexican mobile holding America Movil plans to invest USD 250 million over the next two years to expand the network of its Claro unit in Guatemala. The investment will finance the installation of nearly 1,000 base stations throughout the country, which would put the total number at 1,600 by the end of 2008. The company is most likely looking to capture new mobile users in the market as growth continues to accelerate, rather than draw subscribers away from other operators.
Iusacell To Expand Mexico's Network; Has Plans For Central And South America
August 29, 2007
Mexican mobile operator Iusacell will invest USD 160 million in expanding the number of mobile base stations it has across the country and in adding 3G coverage over the next year. Iusacell is also expected to participate in government auctions to sell spectrum in Honduras and Panama. Iusacell might look for synergies with other companies owned by its parent company Grupo Salinas, such as Mexican Banco Azteca and retailer Elektra. The merger of Iusacell and Grupo Salinas' Unefon's networks will increase the companies' coverage to 89% of Mexico.
Telcel Studies 3G Network Launch For Year-End
August 30, 2007
Mexican mobile operator Telcel, owned by Slim's America Movil (AMX), is testing a 3G network and plans to commercially launch services by year's end. According to a company executive, the network will be launched once there is greater availability of 3G capable handsets in the country. The company is testing equipment from several vendors including France's Alcatel-Lucent, China's Huawei, Sweden's Ericsson and Finland's Nokia. AMX is going ahead with 3G rollouts across Latin America and expects to have networks deployed in around 30 cities throughout the region by the end of the year.
Ericsson Wins Multiyear Service Contract In Mexico
August 29, 2007
Swedish telecom solutions provider Ericsson said that it will provide a comprehensive spare parts management service for the GSM network of Spain's Telefonica Mexican unit. Ericsson will manage multivendor spare-parts supply and logistics for radio access, transmission and core network. The multi year contract also includes ecology management for the disposal of hardware units, as well as logistics, deliveries and service performance reporting to help increase the operator's efficiency. Ericsson said that Telefonica will benefit from cost reduction in logistics and management as well as improved spare parts handling procedures. No financial information was provided.
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Media & Entertainment
Cablestar To Buy Bestel Assets For USD 325 Million
August 31, 2007
Mexican media and entertainment group Grupo Televisa said its cable affiliate Cablestar signed an agreement to buy most of the assets of privately held telecom company Bestel for USD 325 million in cash, including a capital injection of USD 69 million. Cablestar is 70%-owned by Cablevision in which Televisa has a 51% stake. The deal still has to be approved by regulatory authorities. Bestel mostly offers data and long-distance services to phone carriers, both in Mexico and the U.S.
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Farming & Agriculture
SAGARPA, Economy Ministry To Protect National Farmers From NAFTA
August 27, 2007
The Agriculture, Livestock & Rural Development Ministry (SAGARPA) and the Economy Ministry announced a transition program for corn, beans, sugar cane and milk in order to protect national producers of these goods from the negative effects that NAFTA's total opening in January 2008 might have on them. The Economy Ministry also said that it would complain at the World Trade Organization (WTO) against the U.S. subsidies on rice.
Mexico Heads World's List Of Corn, Rice, Milk And Sorghum Importers
August 30, 2007
Mexico heads the world's list of importers of basic foods such as corn, rice, milk and sorghum. According to the National Statistics Institute (Inegi), Mexico's corn imports during the first nine months reached an unprecedented 119% increase. The situation for the country could worsen due to these goods' price hikes in the international markets, which according to the National Farming Counsel (CNA), resulted in a USD 968 million deficit in the farming balance in the 1H.
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Hospitality & Tourism
Riu To Launch Hotel Complex In November
August 31, 2007
Spanish hotel chain Riu said it will launch Riu Santa Fe hotel complex in November. The complex will be located at Los Cabos, in the state of Baja California Sur and will represent investment of EUR 120 million. Following the launch of Riu Santa Fe, the firm will be operating 13 hotels in Mexico, a market it entered in 1997 with a hotel at Playa del Carmen, in the state of Yucatan.
BDI To Build Tourist Development In Acapulco
August 29, 2007
Mexican developer BDI plans to invest about USD 55 million along with former first lady Cecilia Ocelli's brothers in the Horizon at Vista Alviento tourist development in Acapulco, in the state of Guerrero. The businessmen intend to sell a tourist service called "fractional purchase" by which eight people unite to buy a property and share its cost and ownership. Currently, the Mexican units of Spain's banks BBVA and Santander said they are interested in financing the project.
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Economy
Wealthy Mexicans Sent Over USD 15.4 Billion Abroad In Six Months
August 28, 2007
According to the Central Bank's report on the balance of payments, wealthy Mexicans have sent over USD 15.4 billion abroad during the first half of the year, mainly to be placed in foreign banks and to be invested in foreign economies. The currency "emigration" is equivalent to 80.3% of the public income earned through foreign direct investment during the same period, which was a historical record high that amounted to USD 19.2 billion.
Cofemer: Mexico Loses 12% Of GDP In Administrative Procedures
August 29, 2007
The federal regulatory commission (Cofemer) said that the excessive amount of regulations in Mexico has been harmful for the nation since it represents expenses that are equivalent to 12% of the country's GDP. Therefore, the current administration said that it will overhaul the regulatory framework to reduce the inefficiencies and costs of the procedures system.
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Border & Migration
Calderon Criticizes U.S. Unilateral Policies On Immigration
September 2, 2007
President Calderon gave his annual speech at the National Palace one day after he turned over his state-of-the-nation report. Calderon criticized U.S. immigration policies that have divided families and slowed the amount of money sent home by Mexicans living north of the border. President Calderon's approval rating has risen to 65%, but his war on drugs has lost popular support.
Calderon, Texas Governor Reject Fence On U.S.-Mexico Border
August 29, 2007
President Calderon and Texas Governor Rick Perry agreed on the dire mistake that the building of a double fence along the U.S.-Mexico border would represent. Calderon restated his government's longstanding call for U.S. legislation to ensure that immigration is legal, safe and orderly, and that migrants' human rights are fully respected. The Texas governor expressed support for comprehensive U.S. immigration reform and thanked President Calderon for "the firm policy he has adopted in relation to the struggle against organized crime and transborder violence." Calderon lobbied Perry to have the Texas government accept the validity of the identification document, known as a matricula, issued by Mexican consulates to emigrants in the U.S.
Immigrants Represent 15% Of U.S. Labor Force
August 30, 2007
The U.S. Migration Policy Institute (MPI) said that immigrants in the U.S. represent 15% of the country's labor force; the MPI also said that immigrant wage-earners increased by 30% during the last 10 years. In 2006, 19.74 million immigrants were employed in the U.S., a 66% increase compared to 1996. However, given the recent immigrant raids and the enforced immigration laws in the U.S., some prisoners are being used to replace the illegal immigrants' work in the fields. Some companies such as San Diego based Vision Robotics are also planning to develop robots to harvest oranges as a first step to replace illegal aliens.
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Politics
Calderon Delivers First State-Of-The-Nation Report
September 2, 2007
President Calderon has delivered his first state-of-the-nation report which emphasized the rule of law and security, a competitive economy and development of employment, guaranteeing and providing the same opportunities for all, environmental sustainability, and an effective democracy and a responsible foreign policy. President Calderon turned over the report to lawmakers but became the second president in a row who failed to give the annual speech in Congress. In addition, the recently elected president of the lower chamber, Ruth Zavaleta of the PRD, said she could not receive the report herself from a president elected in a process "questioned by millions of Mexicans"; she then left the site along with 146 deputies and senators from the PRD.
Political Parties Fined MXN 107 Million
August 29, 2007
The Federal Electoral Institute (IFE) is preparing to fine political parties MXN 107 million for irregularities it found on the parties' 2006 ordinary financial reports. The two parties to be fined a higher amount are the National Action Party (PAN) and the Democratic Revolution Party (PRD), who are to disburse MXN 32 million each. Other smaller parties and the Institutional Revolutionary Party (PRI) are to pay about MXN 15 million each.
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Justice, Safety & Crime
Army Arrests High-Ranking Member Of Drug Cartel in Mexico City Restaurant
August 29, 2007
Mexican soldiers and federal police arrested a top leader of the powerful Gulf Cartel who is wanted in Texas for allegedly threatening to kill U.S. federal agents. Juan Carlos de La Cruz Reyna a.k.a "JC," a former policeman in the state of Tamaulipas believed to be a senior figure in the Gulf Cartel, was arrested along with three Colombians and three other Mexican drug suspects. In 2003, the attorney general's office listed de la Cruz Reyna as a "direct collaborator" with the imprisoned cartel leader Osiel Cardenas, who was arrested in Mexico that same year and has been extradited to the U.S.
SEDENA: No Report Linking Senator To Guerrillas Exists
August 29, 2007
Mexican online magazine Reporte Indigo published an article alleging that Senator Rene Arce Islas, of the leftist Democratic Revolution Party (PRD), is a leader of the People's Revolutionary Army (EPR) which claims to have bombed oil and gas pipelines earlier this year. The author of the report said she based her story on a confidential military intelligence report that she had access to. However, the Defense Ministry (SEDENA) denied the existence of such a document. The Senator has also denied any connection to the rebel group, although he acknowledged he was a member of a guerrilla organization in the 1970s.
Mexico Extradites 64th Suspect To The U.S. This Year, Breaks Record
August 28, 2007
Mexico has broken its record for the most extraditions to the U.S. in a year, shipping a man north of the border who is wanted in Georgia for drug trafficking. Hilario Larrago, who faces methamphetamine trafficking charges, is the 64th fugitive sent to the U.S. by Mexico in 2007. Of this year's extraditions, 52 are Mexican citizens and the rest U.S. citizens or nationals of other countries. Twenty-six were extradited to face drug trafficking charges, 21 for murder, 14 for violent sexual offenses, one for alien smuggling, one for kidnapping and another for theft of U.S. Treasury checks.
Aguascalientes State Attorney General Resigns Following Violence Wave
August 29, 2007
The Attorney General of the central state of Aguascalientes has resigned in the midst of a wave of violence that changed the panorama in what had been one of the country's most peaceful regions. A source in the state AG's office said that while the resignation of Xavier Gonzalez Fischer was due to "personal motives," the surge in crime was also a factor. Gonzalez was replaced by Herberto Ortega Jimenez.
Police Find Small Bomb At Torre Mayor Skyscraper
August 31, 2007
About 10,800 people were evacuated from the 55-story Torre Mayor in Mexico City, after an anonymous caller warned the skyscraper's management of a bomb. The police said they had found a small explosive device – which was too small to have caused any significant damage – in a car on one of the parking levels of the office tower. The DF's Public Security Minister said it was not known who had planted the device.
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Other
Lorena Ochoa Captures Canadian Open
August 27, 2007
Mexican golfer Lorena Ochoa fired a two-under-par 69 to finish three strokes ahead of Paula Creamer in the final round of the Canadian Open. The world's top-ranked player, Ochoa, had four birdies and two bogeys at the Royal Mayfair Country Club course. Fresh off winning her first major title, the British Open, Ochoa finished at 16-under 268.
Mexico City Among Most Dangerous Cities For Pedestrians
August 29, 2007
The Institute for Policies for Transportation and Development (IPT) reported that Mexico City (DF) is one of the world's most dangerous cities for pedestrians, with an average of 9.4 people per 100,000 inhabitants run down and killed each year. The IPT director said at the 2nd Forum for the Rights of the Pedestrian, that London reported 1.9 pedestrian deaths per year per 100,000 residents; New York 2.2; Singapore 2.8; Hong Kong 3.8; Bogota 4.1; and Cape Town 19.4. In addition, a member of the Defense Committee for Public Transport Users in Mexico said that an average of 998 people died each year in violent crimes, compared with an average of 1,675 in traffic accidents.
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