International -- Int'l Business: MEXICO
THE EX-COKE EXEC AIMING FOR MEXICO'S PRESIDENCY (int'l edition)
Does Vicente Fox Quesada have a head start on an upset?
The tall man in khakis, navy-blue windbreaker, and cowboy boots doesn't look like someone who's trying to overthrow the system. But as he strides informally through a factory in central Mexico that makes car seats for a nearby General Motors Corp. plant, the dozen executives with him, dressed in their best suits, hang on every word of Vicente Fox Quesada, the governor of Guanajuato state. "We're struggling to build a Mexico that creates jobs and improves the living conditions of our people," Fox tells them, presenting a prize for product quality that he created. The ruggedly handsome politician, who reminds some of the Marlboro Man, then calls for a few women workers to step forward to "make this photo look better, please," as the group poses with the award.YIN AND YANG. The factory visit is vintage Fox: part businessman, part press-the-flesh politician, part Jesuit-educated do-gooder. With such tactics, he's on a lofty mission to replace Mexico's corrupt, decades-old political system with accountable, honest government that is both business-friendly and socially responsible. The former head of Coca-Cola Mexico has already launched ambitious programs to boost education, small business, and foreign investment at the state level. In January, he became the first Mexican politician to formally declare his Presidential candidacy--2 1/2 years before the July, 2000, elections for a single six-year term.
His bid signals the start of what seems sure to be the toughest-fought presidential race in Mexican history. The vote could be a watershed, because the Institutional Revolutionary Party (PRI), which has ruled Mexico for nearly 70 years with a mix of political savvy, corruption, and electoral fraud, is so badly splintered that there's a real risk that it will lose in 2000. A battle for the party's nomination is shaping up between the technocrats surrounding President Ernesto Zedillo Ponce de Leon and old-line party bosses (table). On the center-left, populist Mexico City mayor Cuauhtemoc Cardenas is the prospective standard-bearer of his Party of the Democratic Revolution (PRD).
The high stakes are attracting wide media attention to the candidacy of the charismatic Fox. He is a member of the center-right National Action Party (PAN) but is seen by potential rivals as a distinct threat because he appeals to both right and left. On frequent forays, such as the auto-plant visit, he exudes confidence. "Sure, I think I'm the best one to boot the PRI out of Los Pinos [the presidential palace]," says Fox, as his chauffeured white Chevy Suburban barrels down the highway. "We need a president with moral authority, with demo-cratic legitimacy," he adds. "And that's not Zedillo."
That kind of blunt talk appeals to many Mexicans fed up with the PRI. Fox, whose family businesses include a Western bootmaker and a frozen-vegetable exporter, works to attract foreign investment and boost Guanajuato's exports--which rose 44%, to $4.4 billion, last year. In world-policy forums, he mingles with the likes of Mikhail Gorbachev and Ted Turner. But he moves easily among working-class and poor Mexicans, too, chatting in the colloquial Spanish he learned while growing up on his parents' isolated ranch. "He's a curious mixture," says political scientist Denise Dresser of Mexico's Autonomous Technological Institute. "He's a proto-populist who thinks you need to be close to the people to govern them." But Fox is also "much more forward-looking than his counterparts," Dresser adds. His activities as governor are part of the extensive data available on his state's Web site (www.guanajuato.gob.mx) in Spanish, English, and French.
Indeed, the combination of market economics and social concern advocated by Fox may foreshadow a sharp debate in the presidential campaign over the free-market prescriptions of Zedillo and his predecessors. Latin governments, Fox says, have followed a "ruthless form of capitalism that has generated unemployment and poverty." In Mexico, nearly half the population lives in poverty. "How can a human being be motivated to be a productive worker if he's living on a bare subsistence level?" Governments must create "a free market with social responsibility," he says.
What that means in practice is reflected in Fox's self-help and helping-hand programs in Guanajuato. He won the state's governorship in 1995 after his first bid, in 1991, was thwarted by PRI-engineered electoral fraud. While he is just beginning to build a national following, he enjoys high popularity ratings in Guanajuato thanks to his reputation for honesty and his support for activities from education to small business.
Fox is one of the few Mexican governors to open export- and investment-promotion offices abroad--in Dallas, New York, and Chicago, with more on the way. The state's export boom--and foreign investment inflows of $450 million annually--have helped give Guanajuato an unemployment rate of just 1.8%, the lowest of any Mexican state. "The fact that Fox is a businessman makes a big difference," says Luis Rodriguez Tirado, a shoe manufacturer who subcontracts for companies such as G.H. Bass & Co. and J. Crew Group Inc. "His door is open to anyone who has a good idea, and then he offers real support to implement it."
Fox compares himself to President Clinton in his emphasis on providing opportunities, not giveaways. He lavishes most attention on his innovative scheme of micro-credits to help the poor start businesses. Called Santa Fe de Guanajuato, the program has lent $3 million--in sums of $100 to $400--to 35,000 people over the past 18 months. This year, it will extend $10 million in loans to 250,000 people. Some 300 college students armed with laptops ride bikes each week into villages to monitor the loans, which carry market interest rates. "We're trying to help these small-business people, most of whom are women, move up the ladder to the middle class and become `bankable' citizens," Fox says. Another example of his focus on human capital: guaranteed high school and college scholarships for all youths who maintain a B+ average.GOOD DEAL. By providing schooling and jobs, Fox hopes to keep more Guanajuatans from migrating to the U.S., where an estimated 1 million citizens of the state live. Fox also wants to lure some of those expatriates back via their savings. If citizens from a Guanajuato village living abroad can raise $50,000, the state will match it and build a maquiladora, or export assembly plant, in their hometown, creating 80 to 100 jobs. In 1997, 10 such plants were built, and Fox expects to create 50 more this year.
Will Fox get a chance to implement such ideas nationwide? His early campaign launch--and his acerbic criticisms of fellow politicians--are sure to make him a lightning rod for counterattacks. Within his own party, critics see him as less committed to the PAN than to his own objectives, and his nomination is not guaranteed. PAN's aim, says President Felipe Calderon, "is to win the presidency in 2000--with Fox or with whoever has the strongest candidacy."
Around the country, followers have set up local support groups, called Friends of Vicente Fox, to raise campaign money. The best thing Fox has going for him is many Mexicans' desire to test an alternative to the PRI. His task is to convince a diverse and skeptical electorate that what works in Guanajuato will fill the bill nationwide.By Geri Smith in GuanajuatoReturn to top