VZCZCXRO6246
RR RUEHCD RUEHGD RUEHHO RUEHMC RUEHNG RUEHNL RUEHRD RUEHRS RUEHTM
DE RUEHME #3311/01 3271818
ZNR UUUUU ZZH
R 231818Z NOV 09
FM AMEMBASSY MEXICO
TO RUEHC/SECSTATE WASHDC 9130
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RHMFISS/DEPT OF ENERGY WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RHEHAAA/NSC WASHINGTON DC
INFO RUEHXC/ALL US CONSULATES IN MEXICO COLLECTIVE

UNCLAS SECTION 01 OF 05 MEXICO 003311 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR WHA/MEX, WHA/EPSC 
STATE FOR EEB 
USDOC FOR 4320/ITA/MAC/WH/ONAFTA/GWORD 
TREASURY FOR IA 
ENERGY FOR WARD, LOCKWOOD AND DAVIS 
 
E.O. 12958: N/A 
TAGS: ECON EFIN ETRD ENRG ELTN EAIR PGOV SENV MX
SUBJECT: Mexico Economic Weekly - November 20 
 
¶1.  (U) The Mexico Economic Weekly supplements reporting 
from Mission Mexico Consulates and the Embassy Mexico 
Economic Section to provide a sense of ongoing trends. 
Please contact Adam Shub (shubam@state.gov) or Sigrid 
Emrich (emrichs@state.gov) for questions or comments 
about this report. 
 
¶2.  (U) Table of Contents: 
 
 
ECONOMY AND FINANCE: 
-------------------- 
 
INFONAVIT MORTGAGE ORIGINATION DOWN 20 PERCENT IN 2009 - 
Ciudad Juarez 
 
PROPOSED 2010 JALISCO BUDGET: MORE FEDERAL MONEY, PUBLIC 
TRANSPORTATION INVESTMENT - Guadalajara 
 
THOUSANDS ATTEND MONTERREY JOB FAIR - Monterrey 
 
REAL ESTATE AND CONSTRUCTION MARKET IN YUCATAN REMAINS 
WEAK - Merida 
 
JALISCO CREATES JOBS IN OCTOBER - Guadalajara 
 
 
TRADE AND INVESTMENT: 
--------------------- 
 
MATAMOROS MAQUILA MEMBERSHIP HOLDING STEADY; EMPLOYMENT 
NUMBERS UP IN LAST QUARTER - Matamoros 
 
JOHNSON CONTROLS EYES NEUVO LEON FOR HYBRID BATTERY PLANT 
- Monterrey 
 
DEMAND DOWN, PRICES UP AS CHRISTMAS TREE SALES BEGIN - 
Monterrey 
 
TEQUILA INDUSTRY PURSUES FURTHER PROTECTIONS - 
Guadalajara 
 
 
ENERGY: 
------- 
 
TORREON ANNOUNCES US INVESTMENT IN BIOENERGY PLANT - 
Monterrey 
 
PEMEX: PETROLEUM PRODUCTION TO STABILIZE AT 2.5 MILLION 
BARRELS A DAY - Mexico City 
 
 
LABOR: 
------ 
 
SME ACTIVITIES - AFTER THE NATIONAL PROTEST - Mexico City 
 
 
ENVIRONMENT, SCIENCE TECHNOLOGY AND HEALTH: 
------------------------------------------- 
 
2ND MEETING OF GLOBE STUDENTS AND TEACHERS IN MEXICO CITY 
- Mexico City 
 
NEW TECHNOLOGY AND SCIENCE PARK OPENS IN CIUDAD VICTORIA 
- Matamoros 
 
 
------------------- 
ECONOMY AND FINANCE 
------------------- 
 
¶3.  (U) INFONAVIT MORTGAGE ORIGINATION DOWN 20 PERCENT IN 
2009:  Mexico's largest mortgage lender, Infonavit, 
reported a 20 percent year-over-year decrease in mortgage 
originations in Chihuahua this year to November (24,000 
loans Jan-Nov 2009; 31,000 loans Jan-Nov 2008). 
Infonavit's Chihuahua state delegate attributed the 
decline to the state's high unemployment rate, which at 
9.7 percent is the highest of any Mexican state. 
 
MEXICO 00003311  002 OF 005 
 
 
Infonavit specializes in lending to lower-income segments 
of the population employed in the formal sector of the 
economy.  Workers in the hard-hit maquila sector in 
Ciudad Juarez comprise the largest percentage of the 
state's 216,000 borrowers.  Infonavit said non-performing 
loans in the state were equivalent to 5.45 percent of its 
portfolio as of the end of October (11,000 non-performing 
loans), compared to 4.9 percent nationally.  (Ciudad 
Juarez) 
 
¶4.  (U) PROPOSED 2010 JALISCO BUDGET: MORE FEDERAL MONEY, 
PUBLIC TRANSPORTATION INVESTMENT:  Last minute 
negotiations from Jalisco federal legislators earmarked 
USD $770 million to the state.  Over a quarter of the 
federal earmarks heading to the University of 
Guadalajara, but much of the rest is headed to specific 
infrastructure programs including a major dam and water 
project as well as highway improvements.  Of note, the 
state government is moving ahead with its larger public 
transportation projects.  The second line of 
Guadalajara's rapid-transit bus system Macrobus, started 
earlier this fall, will receive USD $21 million from 
state funds and received the Secretary of the 
Environment's authorization earlier this week to continue 
with its construction.  The project will also replace a 
main thoroughfare through the historic center with the 
bus line and an enlarged pedestrian plaza.  In addition, 
USD $11.5 million from the federal budget is earmarked 
for a third line of the light-rail Tren Ligero. 
Theoretically destined towards a feasibility project, its 
ultimate use and the fate of the project rest on debates 
between a PAN state government administration that 
supports Macrob#s and incoming PRI mayors that prefer 
Tren Ligero.  (Guadalajara) 
 
¶5.  (U) THOUSANDS ATTEND MONTERREY JOB FAIR:  Over 7,000 
people attended the first state government organized job 
fair in Monterrey, where over 150 companies accepted 
applications for nearly 6,000 open positions.  Although 
Neuvo Leon generated more jobs than any other Mexican 
state in the two most recent quarters, the state still 
has a deficit of over 52,000 jobs compared to 2008. 
Positions advertised at the fair included 900 
professional positions and 100 for disabled people. 
(Monterrey) 
 
¶6.  (U) REAL ESTATE AND CONSTRUCTION MARKET IN YUCATAN 
REMAINS WEAK:  While the tourist industry remains 
optimistic based on reservation numbers for the upcoming 
holiday season, real estate and construction continue to 
lag.  In Yucatan, both of these sectors have had a strong 
influence from American buyers.  One contact in the real 
estate business in Merida reported that his twenty-agent 
firm, which largely concentrates on American buyers, has 
not closed a contract in four months.  Contacts here 
attribute the continued slowdown to the fact that most 
U.S. buyers borrow against other real estate assets in 
order to purchase in Mexico, and U.S. banks are still 
reluctant to make those loans.  (Merida) 
 
¶7.  (U) JALISCO CREATES JOBS IN OCTOBER:  Jalisco's 
Secretary of Economic Promotion announced that Jalisco 
created 12,437 jobs in October, the strongest such job 
creation of any Mexican state.  While rural jobs have 
historically led Jalisco to job growth in October, prior 
to last month only 8,409 jobs had been created for the 
entire year.  The Secretary took the opportunity to 
announce that the government's efforts had succeeded in 
its economic promotion packages and that the statistics 
signal that Jalisco is emerging from recession. 
(Guadalajara) 
 
-------------------- 
TRADE AND INVESTMENT 
--------------------- 
 
¶8.  (U) MATAMOROS MAQUILA MEMBERSHIP HOLDING STEADY; 
EMPLOYMENT NUMBERS UP IN LAST QUARTER:  The Matamoros 
Maquila association membership has remained steady with 
97 maquilas in the last year according to Roberto Mattus, 
director of the association.  However, member companies 
 
MEXICO 00003311  003 OF 005 
 
 
reported a decrease of 12,209 employees (from 47,829 
employees to 35,620) between March 31, 2008, and June 30, 
¶2009.  For the quarter ending September 30, members 
reported an increase in hiring for a total of 1,452 new 
positions across all 97 members.  (Matamoros) 
 
¶9.  (U) JOHNSON CONTROLS EYES NEUVO LEON FOR HYBRID 
BATTERY PLANT:  Johnson Controls, the Milwaukee-based 
manufacturer of automotive interiors and batteries, is 
viewing Nuevo Leon as a potential site for a hybrid 
battery manufacturing facility.  Vice President Mauricio 
Leon, head of the company's Building Efficiency unit in 
Mexico, told media that as the company continues to 
recover from the economic crisis and looks to position 
itself for expected growth in global demand for hybrid 
batteries, it is exploring further investment 
opportunities in Nuevo Leon.  Johnson Controls recently 
opened a conventional battery plant in the Monterrey 
suburb of Garcia.  (Monterrey) 
 
¶10.  (U) DEMAND DOWN, PRICES UP AS CHRISTMAS TREE SALES 
BEGIN:  Christmas tree importer Cesar Marroquin estimated 
that tree imports from the U. S. and Canada are down 
about 50% from last year.  He blames lower demand on the 
economic crisis and a 20% increase in the customs duty on 
pine trees.  (Monterrey) 
 
¶11.  (U) TEQUILA INDUSTRY PURSUES FURTHER PROTECTIONS: 
To celebrate its 15th anniversary the Tequila Regulatory 
Authority (CRT for its Spanish acronym) hosted an 
international summit for greater cooperation among 
products derived from specific regions of origin. 
Signing bilateral agreements with regulators of brandy, 
red wine and coffee, among others, the CRT worked towards 
creating globalized standards to protect the quality and 
origin of such products through collaboration and 
training.  The CRT proposed creating a regulatory body to 
protect "typical" products in Latin America such as 
Peruvian pisco, Colombian coffee, and Panamanian hats by 
referring to Geneva-based NGO, OriGIn, that covers 85 
products including European wines.  In addition, the CRT 
signed an accord with the Public Health Laboratory of 
Madrid to verify the authenticity of suspected false 
tequila in Europe.  (Guadalajara) 
 
------ 
ENERGY 
------ 
 
¶12.  (U) TORREON ANNOUNCES US INVESTMENT IN BIOENERGY 
PLANT:  Pedro Vazquez Rodriguez, Vice President of the 
Chamber of Farming and Agriculture of Torreon, Coahuila 
(est population 1 million), announced that an unnamed 
American company, backed by investment from the 
Netherlands and Colombia, would be building a bioenergy 
plant in the city, which will eventually provide 600 new 
jobs.  The local partner will be Mexico City based Ferro 
Fuls S.A. de C.V.  The US$ 200 million facility, which 
should open within a year, will generate 30 MW/day of 
electricity from sorghum, corn and cow manure and also 
produce around 387 million liters of ethanol annually. 
Upon reaching full production capacity, the plant will 
consume about 50 percent of the manure produced annually 
in Torreon, about 4 million tons.  The site for the 
facility contains space for construction of three more 
plants should the initial one prove successful. 
(Monterrey) 
 
¶13.  (U) PEMEX: PETROLEUM PRODUCTION TO STABILIZE AT 2.5 
MILLION BARRELS A DAY:  The Exploration and Production 
Division (PEP) of PEMEX estimates that Mexico's petroleum 
production will stabilize at 2.5 million barrels a day 
for the next five years.  In the medium to long term, 
production forecasts vary significantly.  A key factor 
according to energy experts is how quickly PEMEX and the 
Energy Secretariat can implement the new contract models 
foreseen under the 2008 energy reform, and how successful 
these models will be in attracting international oil 
companies to participate in Mexico.  According to the 
production forecast provided to the Finance Secretariat, 
production could fall to 2.4 million barrels or reach 2.9 
 
MEXICO 00003311  004 OF 005 
 
 
billion barrels a day by 2015.  (Mexico City) 
 
----- 
LABOR 
----- 
 
¶14.  (U) SME ACTIVITIES - AFTER THE NATIONAL PROTEST: 
Martin Esparza and the remaining ex-workers of the 
Sindicato Mexicano de Electricistas (SME) continue to 
struggle against the Mexican government shut-down of Luz 
y Fuerza del Centro (LFC).  After the November 11 
national protest, the rate of people accepting severance 
picked up so dramatically that the GOM decided to open 
the centers on Saturday, November 14, to accommodate all 
the workers.  By the close of business, slightly more 
than 60% of workers had been processed.  Esparza denies 
the numbers the GOM is claiming and insists that the 
workers are standing strong.  On November 17, five full 
weeks after the shut-down, the SME published information 
on what it claims various GOM secretariats owe in unpaid 
electrical utility bills; the GOM has denied any debts to 
LFC and has published its latest bill receipts.  On 
November 19 the SME announced that it would begin hunger 
strikes between November 20 and November 23 in five 
locations around Mexico City:  in the Zocalo, outside the 
Chamber of Deputies and the Supreme Court, in front of 
the Comision Federal de Electricidad museum, and at the 
intersection of Paseo de la Reforma and Boulevar de 
Insurgentes, two very important arteries in the capital. 
There will be around ten people fasting in each location, 
and they will be regularly attended by doctors.  At this 
point, SME leadership will not join the fast.  As 
predicted by many Laboff contacts and other observers, 
the SME protests will likely continue to shrink and 
become simultaneously more dramatic and disruptive. 
(Mexico City) 
 
------------------------------------------ 
ENVIRONMENT, SCIENCE TECHNOLOGY AND HEALTH 
------------------------------------------ 
 
¶15.  (U) 2ND MEETING OF GLOBE STUDENTS AND TEACHERS IN 
MEXICO CITY:  Mexico City's Technical Secondary Schools 
System (DGEST) celebrated their second GLOBE meeting 
November 18-19 with the participation of 250 students 
from 13 public secondary schools.  Mexico joined the 
GLOBE program in 1996 and DGEST celebrated ten years of 
participation in the GLOBE program.  The GLOBE program is 
U.S.-developed and disseminated globally and engages 
students to do practical scientific fieldwork, including 
taking measurements of climate indicators, and send their 
measurements in to a central database for inclusion with 
other statistics from other countries that are available 
to environmental scientists around the world.  Students 
presented their GLOBE activities and took advantage of 
this opportunity to discuss climate change and other 
environmental challenges in their surroundings. 
Officials from the Secretariat of Environment and Natural 
Resources (SEMARNAT), the Secretariat of Public Education 
and the US Embassy enjoyed GLOBE students' presentations 
and witnessed the positive impact of GLOBE in student 
education.  (Mexico City) 
 
¶16.  (U) NEW TECHNOLOGY AND SCIENCE PARK OPENS IN CIUDAD 
VICTORIA:  TECNOTAM Science and Technology Park, which 
seeks to bring together the private, public, and academic 
sectors in order to develop a competitive workforce with 
capabilities in engineering and information technologies 
(IT), opened November 11th.  Park tenants include: 
CINVESTAV, a center for research and advanced studies 
specializing in IT and computer science, granting 
Master's and PhD's; the Universidad Autonoma de 
Tamaulipas, specializing in technology education to 
support the IT sector; TiT@M, the Tamaulipas Information 
Technology cluster; an IT business incubator; and SVAM 
International, a global IT services provider with offices 
in the U.S., India, and Mexico.  Academic institutions on 
site are already working with companies such as SVAM to 
tailor their academic offerings, and will offer 
internships on site.  (Matamoros) 
 
 
MEXICO 00003311  005 OF 005 
 
 
PASCUAL