U.S. groups fear Mexican trade war over Obama tomato move

WASHINGTON, Tue Oct 2, 2012 – U.S. business groups said on Tuesday they were worried about a damaging trade war with Mexico if President Barack Obama’s administration follows through on a preliminary decision to end a 16-year-old tomato trade agreement.

They also expressed concern that last week’s Commerce Department decision was politically motivated to sway voters in Florida, the second largest U.S. tomato producer and one of a handful of battleground states expected to play a decisive role in the November 6 presidential election.

“We think the U.S.-Mexico economic relationship is tremendously important,” Patrick Kilbride of the U.S. Chamber of Commerce told reporters on a conference call. “We don’t want to see another trade war ignited,” he added, referring to a previous dispute over cross-border trucking.

Florida tomato growers have pressed the Obama administration since June to terminate a 1996 agreement with Mexico on the grounds it fails to protect them against Mexican tomatoes sold in the United States below the cost of production.

Terminating the pact would clear the way for Florida growers, who compete with Mexico for the U.S. winter and early spring tomato market, to file a new anti-dumping case against their Mexican rivals.

Last week, the U.S. Commerce Department stopped short of immediately tearing up the agreement, but took a preliminary position in favor of ending the pact. It promised a final decision “as soon as practicable” and in no more than 270 days.

PMG International ex-chairman joins Wal-Mart board

BENTONVILLE, Ark., Mon Jul 30, 2012 – Wal-Mart Stores Inc. on Monday said that the retired chairman of accounting and consulting firm KPMG International KPMG.UL has joined its board of directors, effective immediately.
Timothy Flynn, 55, will serve as a member of the retailer’s audit committee and becomes the seventeenth member of Wal-Mart’s board.
Flynn joined the board of JPMorgan Chase & Co. earlier this year.
Wal-Mart has been embroiled in a bribery scandal at its Mexican operations, which are the subject of investigations by the U.S. Justice Department and the U.S. Securities and Exchange Commission.
In April, a New York Times report said that management at Wal-Mart de Mexicob orchestrated bribes of $24 million to help it grow quickly in the last decade and that Wal-Mart’s top brass tried to cover it up.

Exxon CEO says hopes Mexico extends oil reforms

NEW YORK, Wed Jun 27, 2012 – Exxon Mobil would be interested in investing in Mexico’s oil and gas sector, but only if the Mexican government allows the company to own some energy reserves, its chief executive said on Wednesday.

“We’re not real keen on service contracts, we’re not real keen on fixed margin contracts. Although we have some of those, they’re not particularly great for us,” Exxon Mobil CEO Rex Tillerson told reporters after a speech.

Mexico’s constitution bars outside exploitation of the country’s oil resources, making joint ventures or profit sharing with private companies difficult.

But the country has been seeking to open the door to attract investment from foreign oil and gas producers to help tap the vast reserves there.

Mexico’s state oil monopoly Pemex awarded contracts to some foreign companies earlier this month to help develop offshore fields, but those contracts pay bonuses based on performance and do not allow for ownership of oil and gas.

Tillerson said he was encouraged by the initial moves to open the Mexican energy sector, which could eventually attract financing and technology from the global industry.

“I think it’s going to be a long process. And what we’re advocating is just for Mexico to take the next step,” he said.

In addition to its offshore oil fields, Mexico has the world’s fourth-largest reserves of shale gas, according to the U.S. Energy Information Administration.

But so far, Pemex has drilled relatively few wells in those fields near the Rio Grande because it has little capital to develop those areas.

Wal-Mart bribery review includes Brazil, China

WASHINGTON, Tue Jun 12, 2012 – Lawyers for Wal-Mart Stores Inc. have flagged Brazil, China, India and South Africa in addition to Mexico, as countries that represent the highest corruption risk in a global review, according to a letter from lawmakers investigating the company.

The lawyers said they were retained to review Wal-Mart policies in Mexico, Brazil and China, and later recommended the company also evaluate its operations in India and South Africa. The lawyers referred to those five countries as regions where the risk was the greatest, according to the lawmakers.

The company has acknowledged it is investigating bribery allegations involving its Mexican operations, and that it is conducting a global review of its anti-corruption compliance program, but has not provided details about the review.

The new details came in a letter from two Democratic lawmakers, Representatives Elijah Cummings and Henry Waxman, who are the ranking members, respectively, of the House Oversight and House Energy committees.

The pair wrote to Wal-Mart Chief Executive Michael Duke on Tuesday and asked him to provide additional documents and allow certain witnesses to cooperate with a congressional investigation into the bribery allegations.

Outside lawyers for Wal-Mart briefed the lawmakers on May 21 about the company’s program to comply with the Foreign Corrupt Practices Act, a 1970s-era law that bars bribes to officials of foreign governments.

But the lawyers did not answer any questions about the substance of the bribery allegations, which were brought to light in an April 21 New York Times report that said that management at Wal-Mart de Mexico orchestrated bribes of $24 million to help it grow quickly in the last decade and that Wal-Mart’s top brass tried to cover it up.

The two lawmakers have previously expressed frustration about the information they have received from Wal-Mart.

Wal-Mart representatives did not immediately respond to a request for a comment, but the company has said it is “committed to a full and independent investigation,” and that “it would be inappropriate for us or others to come to conclusions before the investigation is complete.”

Wal-Mart urges worker integrity amid bribery probe

FAYETTEVILLE, Ark., Wed May 30, 2012 – Top executives of Wal-Mart Stores Inc. did not directly mention a Mexican bribery scandal at an employee pep rally on Wednesday, but asked their international workers to focus on “integrity” as a core value.

The world’s largest retailer has been under fire from shareholders and activists after the New York Times reported in April that management at Wal-Mart de Mexico, or Walmex, allegedly orchestrated bribes of $24 million to help it grow quickly last decade and that Wal-Mart’s top brass tried to cover it up.

The matter is being investigated by a number of government agencies in Mexico and the U.S. Department of Justice and the U.S. Securities and Exchange Commission. Wal-Mart is also conducting an internal probe.

Executives talked around the allegations in Mexico, the company’s first and largest international market. They referenced integrity as one of the company’s core values and underscored the importance of complying with local laws.

“It’s doing the right thing, every single day,” Wal-Mart President and Chief Executive Officer Mike Duke told international workers gathered at the University of Arkansas’ Barnhill Arena.

Doug McMillon, president and CEO of Walmart International, said it was up to every employee – from new associates to top executives – to guard the company’s principles.

“If you see something in your business that you don’t think is right, you need to say something,” McMillon said.

Scot Rank, president and CEO, Walmart Mexico and Central America, may have come the closest to directly commenting on the allegations, without specifically mentioning bribery.

“Over the years we have faced difficult and challenging times in Mexico and Central America. These events have united us even more, they have motivated us to continue, to continue pursuing excellence, and work with respect and integrity,” Rank said at the end of the Mexico and Central America unit’s presentation.

Ford to invest $1.3 billion in northern Mexico plant

DETROIT,  Fri Mar 30, 2012 – U.S. carmaker Ford Motor Co. will invest $1.3 billion in its stamping and assembly plant in the northern Mexican city of Hermosillo, creating 1,000 jobs, a top company executive said on Friday.

Ford surpassed General Motors, to become Mexico’s No. 1 car exporter last year, exporting nearly 450,000 vehicles, up 17 percent from 2010 levels. Mexico overall exported a record 2.14 million cars in 2011, a 15.3 percent jump from a year earlier.

“This investment allows us to produce the all-new Ford Fusion and the Lincoln MKZ line-ups, helping us to meet growing consumer demand,” Mark Fields, who is Ford’s president for the Americas, said at an event with Mexican President Felipe Calderon in Mexico City.

Calderon said the investment would help Mexico edge up the list of the world’s top auto exporters.

“Mexico in January rose to fifth place in global auto exports … and I think we are about to move into fourth place,” he said.

Ford’s announcement comes as Mexico has been at loggerheads with regional powerhouse Brazil over the car industry after a surge in Mexican auto exports in 2011 compounded a glut of cheaper imports which are hurting Brazil’s manufacturers.

Mexico gave in to Brazilian pressure earlier this month and agreed to slash auto sales to the southern giant, fixing an export quota for the next three years to save a decade-old trade agreement.

Ford’s Hermosillo plant, which opened in 1986, already employs around 2,700 staff, according to the company’s website.

Ford, the No. 2 U.S. automaker, said in a statement that the new investment comes on top of $3 billion invested in Mexico over the past decade.

U.S., Mexico sign accord for joint oil exploration in gulf

WASHINGTON, D.C. — U.S. Secretary of State Hillary Clinton and Mexican Foreign Minister Patricia Espinosa signed an agreement today for development of oil and gas reservoirs that straddle the two nations’ boundaries in the Gulf of Mexico.

The agreement is the first of its kind signed by the U.S., establishing a legal framework and creating incentives for U.S. energy companies to develop oil and gas resources jointly with Petroleos Mexicanos, the Mexican state oil company known as Pemex. When it comes into force, the agreement will end the current moratorium on oil exploration and production in the Western Gap portion of the Gulf of Mexico.

“With this, we are setting aside the old fear that honestly exists among many Mexicans that Mexico’s oil could be extracted from the other side,” said Mexican President Felipe Calderon. “Any joint reservoir will be jointly exploited,” and we will all gain the benefits.

U.S. Secretary of the Interior Kenneth Salazar called the agreement an historic step that “opens to door to previously off-limits areas in the Gulf of Mexico,” an area larger than the state of Delaware.