Videgaray Says Mexico Oil Bill on Track for Congress in 1st Half

Mexican Finance Minister Luis Videgaray said a bill to break state-owned Petroleos Mexicanos’s monopoly on the oil industry is on track to be presented to congress in the first half of the year, two weeks after he said it would be the second half.

“The energy reform is envisaged for this year, 2013, particularly for the first months, for the first half of the year,” Videgaray said in an interview at the World Economic Forum’s annual meeting in Davos, Switzerland. “It’s something that we’re working on right now, not only the technical aspects, but also achieving political agreement.”

Nomura Holdings Inc. analyst Benito Berber wrote in a Jan. 8 note that he’d turned bearish on the peso “in the very short term” due in part to the potential delay in the energy overhaul. Videgaray told Radio Formula in an interview on Jan. 8 that the bill would be presented in the second half. Pushing off the bill wasn’t a “good signal” and showed that the government is still deciding on its content, New York-based Eurasia Group said in a research note today.

Standard & Poor’s may not upgrade Mexico’s sovereign credit rating based on President Enrique Pena Nieto’s oil and tax bills should his legislation end up being watered down, Lisa Schineller, a sovereign ratings director at S&P, said in an interview yesterday.

Schineller said there’s a lack of clarity on how forceful the bills would be in opening Mexico’s state-owned oil sector to more private investment and at boosting tax collection.

Videgaray didn’t give any details today on how far the oil bill would go to promote competition in the oil industry.

Pena Nieto has vowed to boost economic growth by opening the energy industry to more private investment, lifting tax collection, and spurring competition in key sectors such as telecommunications after Latin America’s second-biggest economy grew an average 2.1 percent in the past six years.

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