August 1, 2013 / 8:51 PM / 5 years ago

Mexico president to present energy reform next week

MEXICO CITY, Aug 1 (Reuters) - Mexican President Enrique Pena Nieto said on Thursday his sweeping energy reform, which is expected to include constitutional changes to lure private investment to help stem a slide in output, will be presented to Congress next week.

The energy reform is a key plank of a wider overhaul of key sectors of Mexico’s economy designed to boost growth in Latin America’s No. 2 economy to 6 percent a year, create jobs and lower energy costs.

“The government will be presenting my initiative, the initiative of the government, in the coming days, I think next week,” Pena Nieto told local radio from hospital as he recovers from surgery to remove a benign nodule on his thyroid gland. He gave no details about his bill.

A top lawmaker from Pena Nieto’s ruling Institutional Revolutionary Party, or PRI, said on Wednesday he expected the reform to be presented on Aug. 7.

Pena Nieto said he hoped the initiative would be debated by Congress during a special legislative period set to begin in mid-August, setting the stage for what is likely to be a heated debate over the future of Mexico’s oil riches.

Mexico’s current sole oil and gas operator is the state-run monopoly Pemex.

Mexico’s opposition conservative party proposed its own aggressive energy reform on Wednesday, which would dismantle the current ban on concessions and risk-sharing contracts in addition to a broad opening of the electricity sector and the creation of a fund to administer Mexico’s oil wealth.

Pena Nieto will need the backing of the conservative National Action Party (PAN) to secure the required two-thirds majority in Congress to pass the bill. The PAN’s proposal raises the likelihood the government will push through a deep reform.

The leftist Party of the Democratic Revolution, or PRD, has made clear it will not support constitutional changes, which it argues are tantamount to privatization. Leftist opponents of any constitutional changes have vowed massive street protests.

Top PRI lawmakers have signaled in recent weeks that the government’s energy reform bill will include controversial changes to the constitution.

Mexico’s current sole oil and gas operator is the state-run monopoly Pemex.

The PAN’s energy proposal seeks to reform Articles 25, 27 and 28 of the constitution, and would also strengthen the country’s energy regulatory bodies by making them autonomous. Those details would be dealt with in so-called secondary laws.

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