Mexican Kremlinology

MARKET NOTE 185

HOUSTON — This report offers a framework for considering the appointments to, and resignations from, positions in the public sector that require appointments by the President of Mexico.

Our particular interest in this topic are the recent resignations of Carlos Morales from the top job in Pemex E&P and of Francisco Rojas as director general of CFE. We consider the basic binary question: Did they jump off or were they pushed out? Our conclusion is that both executives were pushed out, but for different reasons.

But to come to any conclusion on such matters you need a bigger framework for discussion that takes into consideration basic facts of public administration in Mexico:

1)      No one reaches top-level positions in the federal government alone, by his or her virtues or merits.

2)      Everyone in a top job was the candidate of a policy/commercial power group (the closest word in English seems to be “camarilla”).

3)      In Mexico, since the 1990s, these camarillas are led by former, high-level public officials, typically ministers of finance and energy, but also including former directors general of Pemex

4)      Each of these camarillas wants its candidate in jobs that control the biggest budgets and have the widest institutional authority.

These considerations bring into focus how it is that the camarilla led by Pedro Aspe has two former employees of his private equity fund in key positions: finance minister and DG of Pemex. These two appointments to the most prestigious public jobs in the federal government (other than the presidency of Mexico) took place as the outcome of competition among camarillas.

In this light, the question on the table becomes less one about why did either Morales or Rojas resign and becomes more of one about who wanted to have his candidate in those jobs?

Click here to read the introductory pages, and name index, of this report.

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Written by

George Baker

Baker & Associates offers niche-market business and policy intelligence related to Mexico's oil and gas, power and chemical industries. Over 1,000 reports have been issued in the last 20 years. Subject matter expert and publisher George Baker, who directs the firm, has carried out consulting assignments starting in the late 1970s at the height of the Oil Boom in Mexico. He brings bilingual and bicultural skill-sets to understanding and responding to challenges of business and public policy, coupled with a deep familiarity with the history and idiosyncrasies of the Mexican operating environment.

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