146. Executive Summary of the Response to PRM/NSC–411

Mexico’s Interests and Objectives in the United States

Mexico’s perception of its historical economic and to some extent political dependence on the United States is changing. The existence of huge petroleum and gas reserves—and the increasingly evident US interest in their rapid development—presage, in the Mexican view, an increase in Mexican leverage or, at the very least, a change from dependence to interdependence. Moreover, the Mexican government believes that its bargaining strength vis-a-vis the United States will steadily improve; thus, it is in no hurry to conclude deals on matters of mutual interest.

The Mexican government is constrained in its dealings with the United States by a number of self-imposed principles. It generally lives up to the principle of noninterference in other nation’s internal affairs and expects other countries to reciprocate; Mexico City would deeply resent what it perceived as US efforts to influence Mexican policy [Page 318] through economic pressure or appeals to Mexican interest groups. Mexico goes beyond most LDCs in its dedication to national dignity, especially as personified by the Mexican president; Mexico has never accepted traditional aid or military assistance programs and real or imagined slights to the president are taken extremely seriously. Despite their exceptional control of the political process, Mexican presidents avoid taking steps in foreign affairs that would create domestic political risks; since there is no great penalty for inaction in foreign affairs it is considered more expedient to avoid controversial agreements.

Lopez Portillo came to power with a well defined political and social philosophy which stresses democracy, administrative efficiency, and social justice that is tempered by the realities of the Mexican system. The president has maintained the viability of the Mexican system while making cautious openings in keeping with his philosophy. His major commitment is to the preservation of the system and he will step back from reform if he perceives it to threaten political stability.

Mexico’s economy and society are closely tied to those of the United States by geography and history. The US security umbrella provides the cover for Mexico to freely pursue its independent and essentially pacifist foreign policy. While geography has made the two countries neighbors, economics have made them partners. Although a minority partner, Mexico has benefited considerably from this relationship. The United States is by far Mexico’s most important trading partner, source of foreign capital and technology and access to its labor market provides Mexico a safety valve for its excess population.

These connections, of course, not only underpin the relationship but also complicate it. In particular, it has left Mexico especially vulnerable to any setback in the U.S. economy and any effective action by the US to stem the flow of illegal immigrants would have serious destabilizing political and economic consequences for Mexico. Aside from the physical and economic link Mexico, also, periodically rebels against the cultural overflow from the United States—the “colossus of the north”.

Lopez Portillo has placed primary foreign policy emphasis on relations with the United States although there are signs that Mexico is beginning to exert a leadership role in regard to certain Third World causes, though not so flamboyantly as under Echeverria. Despite some indications that the President is disappointed with the slow progress made by the binational groups studying outstanding issues between United States and Mexico, he is not inclined to push for solutions at this time. Lopez Portillo’s go-slow approach may reflect his view that Mexico’s oil wealth is a potential bargaining chip that will increase in value with the passage of time. In the one instance where the President did seize the initiative in bilateral relations—launching plans for a vast [Page 319] new pipeline to sell natural gas to the United States—he was personally embarrassed by the subsequent US government rejection of the deal.

Mexico’s main objectives in regard to the United States are: (1) the establishment of a relationship in which Mexico is an equal partner; (2) the avoidance of any US action on illegal migration; (3) trade advantages; and (4) an agreement by the United States to buy Mexican gas on Mexican terms.

On the trade issue, Mexico would like to obtain better access to the US market through removal of tariff and non-tariff barriers, change in the Generalized System of Preferences (GSP), and assurance that the US government will resist domestic pressures to repeal customs provisions favoring assembly operations in Mexico. Despite the relative openness of the US market, Mexico resents tariff and non-tariff barriers to its exports, particularly marketing orders on tomatoes and the competitive need restrictions on GDP.

While all dealings with the United States are sensitive issues in Mexico, those involving the nation’s jealously guarded hydrocarbon resources require any President to walk on eggshells. Therefore Lopez Portillo’s assertion that Mexico will follow the less economical route of consuming the surplus gas at home cannot be considered altogether a bluff.

Mexico’s status as an important potential source of oil for the United States is almost certain to change the bargaining relationship between the two countries. The perception that Mexico has something that the United States badly needs will affect the attitude of Mexican negotiators if nothing else. This change in perceptions will be in direct proportion to US efforts to encourage the Mexicans to expand oil production and exports.

Although this perception of new leverage may be limited to oil negotiations, it seems more likely that it will strengthen Mexican interest in dealing with most issues as a package. The linking of issues will make the entire network of relations between the United States and Mexico more complicated, more sensitive to political considerations in both countries, and probably more difficult to manage.

  1. Source: Carter Library, National Security Affairs, Staff Material, North/South, Pastor, Country, Box 28, Mexico, 8–9/78. Secret; Not Releasable to Foreign Nationals; Not Releasable to Contractors or Contractor/Consultants. Drafted in the CIA. A draft of the full PRM response is attached. In a memorandum to Vance, August 1, Brzezinski requested that the Secretary schedule a PRC meeting “to review the complex of issues with Mexico and lines of action to deal with them.” (Carter Library, National Security Affairs, Staff Material, North/South, Pastor, Country, Box 32, Folder: Mexico, PRM–41 [Policy], 10/77–11/78) In an August 2 memorandum to Pastor, Inderfurth reported that Carter concurred. (Carter Library, National Security Council, Institutional Files, 1977–1981, Box 50, PRM/NSC–41) The final PRM response was circulated on November 22. (Carter Library, National Security Council, Institutional Files, 1977–1981, Box 50, PRM/NSC–41 [1]) For the section on Energy of the final PRM response, November 22, see Foreign Relations, 1969–1976, vol. XXXVII, Energy Crisis, 1974–1980, Document 170.