Leaving the Limelight

It is hard to believe that José Angel Gurría will be bowing out of the public spotlight in December when Vicente Fox takes over as president of Mexico. Gurría, the silver-tongued secretary of finance and public credit, first burst onto the international stage nearly 20 years ago as a member of Mexico’s debt negotiation team. Since then, and almost without interruption, he has lead successive Mexican financial teams through good times and bad.

Drawing on a Marlboro and speaking in his smooth, eloquent English, Gurría says, “We want [Fox’s government] to start off on the right foot. We are trying to make it easy for them. Previously, all incoming ministers would get were cardboard boxes full of papers.” Transitions became so chaotic that each change in government over the last 24 years-from one PRI boss to another-coincided with severe financial crises. The 2000 changeover, this time from the PRI to Fox’s conservative National Action Party (PAN), is likely to be far smoother than in 1994 when Zedillo’s predecessor left him with a short-term debt crisis that blew up just days after he took office. Mexico’s currency collapsed, dragging down the financial system with it, and sparked a recession that spread throughout Latin America. Zedillo and Gurría have set up an elaborate series of financial defenses, lining up $24 billion in reserves and debt lines to deter any speculative attack on the peso.

Gurría says both sides have worked closely to draw up a budget for 2001. “We have had to produce a budget together because on the first of December they come into office and on the 15th they have to have a budget ready.” He argues that the PRI and PAN will have to learn to cooperate because, “No one has a majority in Congress and anyone can play obstruction and endanger the budget deal.”

Gurría insists that the PRI should continue to play a constructive role once Fox’s administration takes over. “We need to be a responsible, sophisticated opposition,” he says. “We are the biggest block in Congress. We will have formidable political capital to play.”

It helps that between the PRI’s progressive wing and the PAN there is agreement on the basics of “low inflation, low deficit and striking an equilibrium between growth and inflation.” The challenge, he believes, is for the PRI to find a balance between playing a supportive role and acting as “loyal opposition [without] appearing to be irrationally negative.”

What part will Gurría play in the new post-PRI scene? Some commentators reckon he could soon find a position under Fox. After all, there are few Mexicans with as many contacts, as much experience or able to command as much respect in the international financial markets as Gurría. But one Wall Street banker thinks Gurría is too deeply identified with the PRI to be acceptable to the new guard.

Another reason he might have to become accustomed to life away from the spotlight is that he and Zedillo are not particularly popular in the PRI and there are signs that the party’s old-guard members are consolidating their power. Zedillo is despised for “losing” the July elections that international observers widely recognized as the cleanest ever. But Gurría is philosophical: “People wanted change and …because the economy was strong and there was no economic uncertainty, there was political confidence to vote for change.”

There is no guarantee that the PRI will remain a united party, or that its more enlightened members will remain in the ascendancy. Neither is it certain that all members of the PAN will work effectively with Fox. Gurría says, “The PAN is sorting itself out and the PRI is too, in a very fundamental way. It is looking for a leader. The question is, to what extent the initiatives of the new government will be supported by the PAN, and how much it can count on the PRI.”

Just about everybody is crossing their fingers, hoping that the markets will remain calm as the fateful day in December approaches. Although it is likely he will remain a powerful voice in the debate on economic policy, nobody wants to have to call on Gurría’s skills as a financial firefighter just yet.