MEXICO-CENTRAL AMERICA:
High Voltage Boost to Integration
Diego Cevallos

MEXICO CITY,  (IPS) - The Puebla-Panama Plan, whose progress so far has been slow, lacklustre and severely criticised by social activists, received an injection of energy with the start of work on a power line that will connect Mexico and Guatemala.

The initiative will cost a total of 55 million dollars, part of which will be financed by the Inter-American Development Bank (IDB). The aim is to create an electrical grid uniting Mexico with Central America and even Colombia in South America.

Presidents Vicente Fox of Mexico and Óscar Berger of Guatemala met Tuesday in the Mexican town of Tapachula, 11 kilometres from the Guatemalan border, to launch the interconnection works and to heap praise on the Puebla-Panama Plan (PPP).

Plans for electrical interconnection date back to the 1980s, long before the PPP -- which was announced by Fox in 2001 -- was even designed, Fernando Cuevas, head of the energy unit of the Economic Commission for Latin America and the Caribbean (ECLAC), pointed out in an interview with IPS.

According to Cuevas, in recent years the PPP has made advances in different fields, especially energy, but the future of the overall plan is uncertain.

The PPP is an ambitious regional integration and development project for Mesoamerica, an area that includes nine states in southeastern Mexico, plus Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama. This entire region covers one million square kilometres and is inhabited by 64 million people, a large proportion of whom are poor.

After a highly publicised launch, the plan has been enveloped in silence for long periods of time. Many observers, indeed, came to think it was doomed to oblivion.

"In fact, many people have their doubts about the fate of the PPP once Fox finishes his term of office in December, because he was the driving force behind it. We don't know what the next president will do," Cuevas said.

On Jul. 2, Mexicans will elect Fox's successor. The most likely candidates for his post, according to the polls, are Felipe Calderón of the conservative governing National Action Party (PAN) and Andrés López Obrador of the leftwing Democratic Revolution Party (PRD).

Neither of the candidates has even mentioned the PPP in their campaign speeches.

"We believe that, in its original version, the PPP is defunct, and that what we are seeing now is progress on specific individual projects, and these are also receiving much less publicity than before," Héctor de la Cueva, a spokesperson for the Mexican Action Network on Free Trade (RMALC), told IPS.

RMALC and other organisations which oppose the model of global integration and free trade being applied in Mexico and its Central American neighbours maintain that the PPP is "neocolonialist" and is promoted by the United States in order to subject Mesoamerica to its own commercial and economic interests.

"We say that any version of the PPP will come up against the crash barrier of the social movements," de la Cueva declared.

The activist said that the United States is highly committed to supporting "the new, less publicised PPP, particularly in the light of the integration process in South America," promoted by the administration of the leftwing president of Venezuela, Hugo Chávez.

The original PPP mooted by Mexico included projects to develop production and social progress in the region, road building, hydroelectric dams, coordinated management of natural resources and trade policies, power transmission interconnection and the installation of maquiladoras (export assembly factories in tax-free zones).

So far, apart from the electrical interconnection plan for Mesoamerica, which was originally scheduled to come onstream in 2003, there has been no significant progress on other fronts.

However, new projects have emerged in parallel which have not been directly presented as part of the PPP. The largest of these is the Mexican proposal to build an oil refinery in Central America, to begin operations in 2011.

The refinery would cost four billion dollars and would use crude from Mexico as its raw material, producing derivatives for Mexico and its Central American neighbours, which produce hardly any oil.

As for the power line interconnections between Mexico and Central America, the target now is for it to be ready in 2008.

The head of ECLAC's energy unit said that Colombia is very interested in joining the plan, which is feasible because there are already possibilities of linking the electric grids of Colombia and Panama. Furthermore, Mexico and the nations of Central America support the idea, he said.

The presidents of Mexico and the seven countries of Central America are to meet in Panama on Jul. 11, to keep up the momentum towards electrical interconnection and to review Mesoamerican integration plans.

This will be the Eighth Summit of the Tuxtla Mechanism for Dialogue and Coordination.

De la Cueva, meanwhile, said social organisations in the region will be keeping a close watch on "the new PPP that has replaced the original plan."

"We will not let down our guard, but we must wait and see what the new Mexican government says and does," he said.