Image credits: Markus Winkler
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News Article

Experts in Energy Panel Discuss Government’s Lack of Clarity

By Kristelle Gutiérrez | Wed, 07/13/2022 - 10:11

The US singled out the Mexican government for hindering foreign investments and freedom of operations. Energy experts and authorities from Mexico and the US spoke about the industry’s potential and the risks posed by the administration’s “legal opacity,” during a COPARMEX energy panel conference.

Laura Sima, Director of the Office of the Department of Energy, US Embassy in Mexico, credited recent legal battles between private companies and state authorities to the lack of clarity in state regulations in the energy sector. Sima was recently at the Mexico-US business forum’s energy conference organized by COPARMEX where she expressed that some of the measures the federal government took to strengthen CFE and PEMEX ended up hindering foreign private participation.

“Mexico cannot succeed in some areas due to the secrecy and lack of certainty in some investment and regulatory environments. Investors from the private sector should be able to work with clear rules; they should not need to go behind closed doors to have their paperwork approved,” explained Sima.

Sima specifically criticized the delaying or denying altogether of permits for foreign private companies in the energy sector. “In Mexico, there is much-untapped potential for renewable energy that if it were to be realized, it would create millions of better-paying jobs and help Mexico reach an export industry status.” She further emphasized that foreign capital is not only at stake in these conditions but also the federal administration’s chances to fulfill its environmental commitments.

According to Sima, the US Energy Department is willing to cooperate with the Mexican government to ensure that private companies can operate with more freedom and thus secure investments. However, she said legal secrecy should be cleared out from the sector

Laura Sima was not alone in pointing out this clarity deficiency in the energy sector. Kenneth Smith Ramos, Head of the Trade and NAFTA Office, Mexico Ministry of Economy, said that for USMCA to be renewed in 2026, Mexico should allocate resources to the realization of public policies that encourage foreign investment and comply with international agreements, such as the Paris Accords. Smith Ramos’ bet is for a technologically advanced program that takes advantage of the state-of-the-art quality that productive plants already have.

Ken Salazar, US Ambassador to Mexico, also spoke at the same panel conference to share that both countries currently have the opportunity to come up with viable legal frameworks which will not depend on the people in power. “There is a lot of work to do, not only in the energy sector but also in other fields like migration and environmental issues, which affect both Mexico and the US.”

The data used in this article was sourced from:  
El Economista, El Sol de México, Forbes, La Razón.
Photo by:   Markus Winkler
Kristelle Gutiérrez Kristelle Gutiérrez Junior Journalist & Industry Analyst