VZCZCXRO6853
PP RUEHCD RUEHGD RUEHHO RUEHMC RUEHNG RUEHNL RUEHRD RUEHRS RUEHTM
DE RUEHME #2453/01 2212240
ZNR UUUUU ZZH
P 082240Z AUG 08
FM AMEMBASSY MEXICO
TO RUEHC/SECSTATE WASHDC PRIORITY 2904
INFO RUEHXC/ALL US CONSULATES IN MEXICO COLLECTIVE PRIORITY
RUEHGV/USMISSION GENEVA PRIORITY 1040
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC PRIORITY
RUEATRS/DEPT OF TREASURY WASHINGTON DC PRIORITY
RUEHC/DEPT OF LABOR WASHINGTON DC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC PRIORITY
RUEHRC/DEPT OF AGRICULTURE WASHINGTON DC PRIORITY
RULSDMK/DEPT OF TRANSPORTATION WASHINGTON DC PRIORITY

UNCLAS SECTION 01 OF 02 MEXICO 002453 
 
SENSITIVE 
SIPDIS 
 
STATE FOR A/S SHANNON 
STATE FOR WHA/MEX, WHA/EPSC, EB/IFD/OMA, EB/CIP/BA 
USDOC FOR 4320/ITA/MAC/WH/ONAFTA/GERI WORD 
TREASURY FOR IA (RACHEL JARPE, LUYEN TRAN) 
NSC FOR RICHARD MILES, DAN FISK 
STATE PASS TO USTR (EISSENSTAT/MELLE/SHIGETOMI) 
STATE PASS TO FEDERAL RESERVE (BORA DURDU) 
 
E.O. 12958: N/A 
TAGS: ECON PGOV ETRD EFIN MX
SUBJECT: CALDERON'S CHIEF OF STAFF REPLACES SOJO AT ECONOMY 
MINISTRY 
 
Summary 
-------- 
 
¶1. (SBU) President Calderon announced that Eduardo Sojo would 
be leaving the helm of the Economy Secretariat in order to 
head up the National Institute of Statistics and Geography. 
Calderon assigned his Chief of Staff and longtime political 
confidante, Gerardo Ruiz Mateos, to succeed Sojo as Secretary 
of Economy, publicly praising his experience as a businessman 
and charging him to fight inflation, foster small business, 
and make Mexico a "multi-directional link" for international 
trade flows.  Ever since the tortilla crisis in early 2007 
there have been complaints about Sojo's lack of firm, 
executive leadership and rumors of his impending departure. 
Although Ruiz lacks Sojo's academic pedigree, his close ties 
with the President could make him a more authoritative 
figure.  Ruiz has said he does not plan to change any of his 
top officials for now, but it remains to be seen how long 
"now" will last.  One change that has already been made is 
that Felipe Duarte, the hitherto chief economic adviser in 
the Office of the Presidency, has replaced Alberto Ortega 
Venzor as the Chief of Staff to the Secretary of Economy. 
Ruiz will be replaced by Patricia Flores as the new Chief of 
Staff in the Office of the Presidency.  End summary. 
 
Sojo to INEGI 
------------- 
 
¶2. (U) On August 6, President Calderon announced a major 
shake-up in his economic cabinet.  Secretary of the Economy 
Dr. Eduardo Sojo-Aldape would be leaving his post to take 
over the National Institute of Statistics and Geography 
(INEGI).  Sojo, if approved by the Congress, will run INEGI 
through December 2009.  In previous professional incarnations 
he has served as Technical Director and Director of 
Statistics of INEGI.  As Calderon noted in his remarks, INEGI 
has been strengthened by recent amendments to its governing 
law that have made it autonomous and shifted responsibility 
for official economic statistics (e.g., inflation, GDP 
growth, unemployment) from the Bank of Mexico to INEGI.  We 
expect that most of the statisticians now working for the 
Bank of Mexico will simply be transferred to INEGI. 
 
¶3. (SBU) Bank of Mexico Governor Guillermo Ortiz told 
econoffs that he was happy to see INEGI take on this work, as 
the Bank of Mexico had previously been in the uncomfortable 
position of both measuring and fighting inflation.  He also 
said that the Bank of Mexico had been plagued by a number of 
legal actions in which private parties had alleged 
inaccuracies in its inflation statistics that had resulted in 
unwelcome contractual obligations tied to the rate of 
inflation.  An Assistant Secretary-level contact in Economy 
told econoff that while the move to INEGI was at least a 
half-rank demotion, he believed that Sojo welcomed it.  This 
was due to exhaustion from his workload and constant stress 
regarding rising prices, and the fact that INEGI is 
headquartered in the city of Aguascalientes, much closer to 
his hometown of Leon, Guanajuato than Mexico City. 
 
And Ruiz to Econom!a 
-------------------- 
 
¶4. (U) At the same press event, Calderon announced that his 
Chief of Staff Gerardo Ruiz Mateos would be taking over the 
Secretariat of Economy (effective immediately - the Secretary 
of Economy does not need congressional approval).  Ruiz 
received his industrial engineering degree from the highly 
regarded Technological Institute of Monterrey and became 
director of an auto-parts manufacturing firm in Queretaro in 
¶1989.  He joined the National Action Party (PAN) in the 
mid-1990s and has been closely connected with Felipe Calderon 
ever since, serving as the executive director of the PAN's 
National Committee while Calderon was party chief.  He was 
the chief of finance and administration for Calderon's 2006 
presidential campaign, served as technical coordinator for 
 
MEXICO 00002453  002 OF 002 
 
 
the presidential transition, and then served as Coordinator 
of the Cabinet and Special Projects in the Office of the 
Presidency until he replaced Juan Camilo Mourino as Chief of 
Staff.  In his remarks, Calderon commented on his high level 
of personal trust in Ruiz, but also noted that his experience 
running a private sector company and being on the "other side 
of the counter" from the government gave him an intuitive 
sense of what needs to be done, i.e., "deregulate the economy 
and free the country's productive forces to spur growth." 
The President directed the newest member of his cabinet to 
focus his energies on five tasks: 1) support Mexican families 
as they struggle with higher prices; 2) continue to promote 
investment to generate jobs for Mexicans: 3) strengthen 
programs to support small- and medium-sized enterprises; 4) 
strive to make Mexico "a multi-directional link in trade 
flows among Asia, America, and Europe" and 5) coordinate the 
efforts of all relevant federal agencies in order achieve 
faster economic growth. 
 
¶5. (SBU) Ruiz brings with him as his chief of staff Felipe 
Duarte, who was the chief economic adviser in the Office of 
the Presidency.  Ruiz told press yesterday that he does not 
plan to make any other major personnel changes for the time 
being.  However, a contact in the Economy Secretariat told 
econoff that Ruiz has quarreled with Rocio Ruiz, Under 
Secretary of Economy for Industry and Commerce, and Jesus 
Heriberto Felix, Under Secretary of Economy for Small and 
Medium Enterprises, and he would not be surprised to see them 
leave in the not-so-distant future.  On the other hand, we 
are assured that Under Secretary of Economy for International 
Trade Negotiations Beatriz Leycegui still plans to attend the 
Americas Competitiveness Forum being hosted by Commerce 
Secretary Gutierrez in Atlanta later this month, and a 
Foreign Ministry contact told econoff he suspected Ruiz would 
attend as well (Embassy is still seeking confirmation).  Our 
Economy contact remarked that Ruiz was substantively far less 
prepared for his new responsibilities than Sojo had been, but 
acknowledged that he would wield considerable clout given his 
closeness to the President.  He also mentioned that Patricia 
Flores, who will take over as Calderon's chief of staff, will 
have a very limited policy role due to the fact that her two 
predecessors took much of their policy portfolios with them 
(Mourino to Interior and Ruiz to Economy). 
 
Comment 
------- 
 
¶6. (SBU) Numerous outside commentators have long criticized 
Sojo for being a weak executive at Economy, especially since 
his slow response to the tortilla price crisis in early 2007. 
 Running an important technical agency like INEGI is no 
sinecure, but clearly at least half a step down from heading 
a cabinet-level policy department.  We do not know whether he 
was pushed out or transferred to INEGI willingly, but the 
announcement caught almost everyone (including our Economy 
contacts) by surprise, indicating that he made the move with 
his dignity intact.  It remains to be seen how Ruiz's 
performance will compare with his predecessor's, but dealing 
with the daunting challenges of rising inflation, the U.S. 
economic slowdown, and Mexico's own low growth rate provide 
him ample opportunity to earn his spurs.  What is obvious is 
Calderon's clear preference for filling new openings in his 
cabinet with longtime loyalists.  End Comment. 
Visit Mexico City's Classified Web Site at 
http://www.state.sgov.gov/p/wha/mexicocity and the North American 
Partnership Blog at http://www.intelink.gov/communities/state/nap / 
BASSETT