REAGAN, DE LA MADRID, TO DISCUSS MONEY WOES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP88B00443R001003860117-8
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 20, 2016
• Document Release Date: June 20, 2006
• Sequence Number: 117
• Publication Date: October 6, 1982
• Content Type: OPEN SOURCE

ed For Release 2007/01/20: CIA-RDP88BOO443ROO10038d
DATE
TRANSMITTAL SLIP 12 October 1982
TO:
NIO/Latin America
ROOM NO. I BUILDING
SA/DCI
ROOM NO. I BUILDING I EXTENSION
FORM B NO. 55 241 REPLACES FORM 36-8 (47)
ed For Release 200/t5H1nbBECA=RDP88BOO443ROO1OO386
 A 10 8'ed?edo , October 6.1982 THE WASHINGTON POST
R~ag~n, de. la, Madrid
To Discuss MoneyL.,WoesL
By Joanne Omang agenda. De la Madrid, 47, does not
Washington Post staff writer take office until'Dec.1 and, although
uation will be a topic, for discussion _ ences with -Lopez Portillo, whom he
h t
d
de la Madrid in Tijuana, and the loyalty and service, the party often
two' will cross the border later to has talked a much more strident line
suits are expected-to emerge from tiatives now.
the meeting., Mexico's ruling Institutional Rev-
Instead, the -informal talks are olutionary Party has no real ideol-
likely to be mutually exploratory, ac ogy, but has held power since 1929
cording to diplomatic and adminis-- , as a. shifting coalition of interest
tration sources,.with the leaders each' -groups, particularly the labor unions
seeking to learn what the other it rewarded with : a spectrum of eco-
wants. nomic subsidies.
Reagan will interrupt a western . With its stiff hierarchy, nearly un-
campaign and vacation trip to meet. " limited power and tradition of party
1recor, canno
when President Reagan sees Mex- - served as budget
ican President-elect Miguel - de la under Mexican tradition make any
Madrid Friday, but no concrete re- policy declarations or launch any-ini-
Lopez Portillo, apparently is on the- The Reagan administration has
verge'of signing a $3.92 billion three- already taken ;what one financial an-
year loan agreement with the Inter- alyst said were all the short-term
national Monetary Fund, swallowing ' steps possible in trying to help .Mex-
the nationalistic pride' that has . 'ico out of'its bind, paying for $1 bil-
blocked resort to the IMF -in the lion worth of Mexican oil a year in
past, advance and providing another $1
A council of major. bank' execu, billion in cheap credits for agricul-,
tives is working 'to come up with the tural purchases' in the United States.
rest of the immediate transfusion Washington also helped engineer a
Mexico 'needs, and de la Madrid is ' $1.85 billion credit package from the
assumed to be hopeful that Wash'- Bank for International Settlements.
ington will contribute to it somehow. Any further big money would
On this side of the Rio Grande, have to involve Congress, either
administration sources said, ;v-ahi through' foreign aid appropriations,.
ington would like' Mexico to moder- which ?.re alwsjs ''ontroversial, or
ate its leftward rhetoric in interna- legislation to change tr..'e and tariff
tional forums and to take a more arrangements, not easy either.
conciliatory tone toward U.S. policy 'The talks' are certainly likeq to
in El Salvador and Nicaragua. ' explore what Mexico can expect
There is also pressure from Rea- from the United States .... , but the,
gan's right to get Mexico to unfreeze main purpose is for the two presi-'
about $12 billion in American money " dents to establish a personal rela-
in Mexican bank accounts, about $5 tionship," said Manuel Alonzo, de la
billion of which belongs to U.S. cit- Madrid's press secretary, in a, tele-
izens and corporations. phone conversation from- Mexico
But none of this-is on the formal City7
continue their'talk in San Diego. than its leaders wind up taking in
Mexico needs to raise about $8.3,- times of crisis.
billion over the next year to cover' De la Madrid, known as an affa-
the gap between its likely income ble, cool-headed planner, is likely toy
and the interest payments 'on an face rising unrest at home from the
r overheated decade's worth of inter- belt-tightening conditions the IMF is
national ?. loans. The country has certain to attach to its -loan, and he
halted ' payments on the principal, is thought to be more interested
which totals $75 billion, the largest than-Lopez Portillo in smoothing re-
debt of any developing nation. lations with Washington. ' .
American bankers are particularly For his 'part, Reagan cannot
nervous 'because $25 ,billion of that broach any possible exchange of fa-
debt is owed to them and 90 percent vors without appearing'to be trying
of the total debt is in dollars. A to take advantage of Mexico's trou-
Mexican default would rock the bles, administration sources indi-
world financial system, but so much cated. So he has been well briefed
.is at stake that a default is highly and is expected to offer informed
unlikely. commentary to Madrid's description
Instead Mexico's president, Jose ? of the situation.
['-8 ILLEGIB
Approved For Release 2007/01/20: CIA-RDP88B00443R001003860117-8