The aim and the promise of Governor Roberto Albores of Chiapas is to create 300,000 jobs during the three years remaining of his interim term. If we calculate an average of 100 jobs for each program of direct foreign or national investment, 3000 programs would be necessary in order to reach these goals, and there have been only 15 new programs operating since the beginning of the conflict. At 10 investment projects per year, 300 years would be necessary to reach the aim. On the other hand, many of the few jobs which are being created, or which are planned, are aimed at the impoverished urban worker and the migrant population on the border with Guatemala, not for the indigenous population, forgotten by these investment schemes. In the case of the workers, a leader from the Workers' Confederation of Mexico (CTM) stated that this month more than 40,000 workers in Chiapas are surviving in situations of extreme poverty, without access to the benefits of housing, social security and decent wages, due to the lack of investments and the failure to re-activate productivity in the state over the last 4 years. He also said the Chiapaneco worker is the most exploited in the country, with a less than minimum salary, fluctuating around 20 pesos per day ($2 USD), putting it at "subhuman subsistence." This cheap labor is one of the primary reasons for possible interest in foreign investment in Chiapas, but the industrial sector is poor and the technology scarce; the workers are few, impoverished and not qualified. However, the export maquiladora industry is attempting to create 10,000 jobs in Chiapas over the next two years (3.3% of Albores' dream).

Official information is contradictory. While the State Employment Service (SEE) in Chiapas states there are 37,000 unemployed in the state; there are about 15,000 displaced; the governor offers 263,000 more jobs, at the same time saying there are 500,000 Chiapanecos who do not receive one cent per year. Regardless, taking the SEE figures, the jobs created up to this point by the investments, added to those projected for the next two years, will not reach even half of the data provided. On the other hand, Governor Albores Guillén, for the purpose of "improving the economy," announces that funds have been allocated for the training of 980 persons, in 23 courses for the unemployed through the Training Grants for the Unemployed programs. Let us look at some examples of the investments:

Japanese businesses, such as the Mafer, invest in peanut production and in the production of shrimp and tuna, as do Norwegian businesses. In an alliance with Mexican capital, the Axa Yashaki company will install, for the production of automobile parts in Tuxtla, the first binational maquiladora plant for the production of automobile seatbelts, with an investment of US$1.2 million, and which will offer 150 direct jobs (contributing 0.05% of Albores' goal). The government of the state is subsidizing the company through a training course for its future workers. With the visit of Prince Akishino in 1997, investments were announced for Puerto Madero which, with decentralization, will promote the recovery of import-export; in the same way, investments were announced for rice, maquiladoras and auto parts in the Soconusco zone (along the Guatemala border), where Japanese families and businesses are found. For this reason, President Zedillo has visited the municipality of Acapetahua. The greatest part of the Japanese immigrants are concentrated in this region, where they inaugurated a monument to the arrival of the Japanese in Chiapas in 1892. Zedillo has been committed to supporting and promoting the production of African palm, camedor palm, sesame, macadamia, among others, as agricultural export products from Chiapas, supplanting crops such as corn and beans. He has also promoted the installation of oil extracting factories, such as those which are being developed in the municipalities of Jiquipilas, Villa Comaltitlán and Acapetahua. During the next few months, the President will be visiting Japan and Malaysia.

An agreement was signed between the country's agricultural authorities and the Mission of the Japanese Agriculture, Forestry and Fisheries Ministry, for the development of a master Plan for the Complete Development of the Agricultural Sector in the Soconusco Region, for the purpose of identifying potential for development, investment opportunities and the creation of programs to integrate development of the agricultural, livestock and fishing sectors, among others. The short-term goals for five years are for the development of a program for the transformation of technology, aimed at facilitating the participation of Mexicans in the systematization, analysis and interpretation of information, as well as for the formulation of a development plan, and the review of information on forest and fisheries resources. This plan will be very necessary in order to counteract the effects of single-crop plantings in Chiapas.

Some businesspersons in Guatemala are interested in investing in pharmaceutical laboratories in San Cristóbal de las Casas, with an investment of $4 million. Other Guatemalan investors from the banana and palm culture company, Agrocaribe, S.A., wish to invest in African palm, for which they will require 5000 hectares (has.) from independent producers (not campesino organizations). Their representative, Arreola Buchet, stated that that the area along the southern Guatemalan coast has the best African palm yields in the world. Malaysian businesses are also investing in African palm and camedor palm, marañon (Indian nut), macadamia, sesame and sunflower in the Coastal zone. In addition, the Commercial Consul of the Israeli Embassy in Mexico met with Chiapas businesspersons this March and visited papaya and jalapeño chili plantations The consul expressed great interest in investment in agriculture, agro-industry and tourism primarily, and in the possibility of Israeli agro-technology commercial businesses investing in Chiapas.

In February, the Swiss company, Barry Callebaut France, S.A., announced the possibility of investing in the Soconusco zone. They said they would require 15,000 tons of cacao for their installation, when, according to Governor Roberto Albores, Chiapas produces 31,000 tons, and in three years would guarantee another 10,000, and 400,000 tons in the long term (12% of world production). They are thought to be the largest company manufacturing industrial chocolate in the world.

United States companies, such as Warren To Texas and Bremer Food, are interested in the production of beef for export. McDonald's opened its 121st restaurant in the country in Tuxtla Gutiérrez, the state capital, in 1997, valued at $45,000. Despite the fact that Chiapas is an important producer of beef, as well as of vegetables, McDonald's will be importing their beef from the north of the country (Monterrey, Nuevo León), vegetables from the state of Puebla and potatoes from Canada, according to press reports. Soft drinks will come from Coca Cola and coffee from Chiapas. In addition, they will create 72 direct jobs (for middle-class young people). Subsequently, the company has considered locating in San Cristóbal de las Casas. This is not the only case of companies not seeking local markets.

Mexican businesses are also investing in Chiapas. The PULSAR group invests primarily in eucalyptus and rubber in the Northern Zone, in the municipalities of Playas de Catazajá, Salto de Agua and Valle de Tulijá; gandhúa bamboo in Reforma and Marqués de Comillas; chilies and papaya in SuChiapa; tomatoes, tobacco and chilies in La Trinitaria and La Independencia; fish farms, rubber, papaya, peanut fodder, bananas, mangoes, citrus, etc., in Soconusco. The PULSAR group states that it employs 13,000 persons in Chiapas, and it has 2500 family members in the municipality of La Trinitaria in agricultural co-investment in vegetables, tobacco and bamboo. It also has three of the most advanced experimental camps in the world. This is one of the companies which has benefited the most from the constitutional modifications in agrarian matters, enabling them to enter into agreements with the ejidos.

The HERDEZ company acquired the Fishing Plant in Chiapas in Puerto Madero - municipality of Tapachula, on the border with Guatemala - with an investment of US$15 million, creating 300 jobs (contributing 0.1% of what Albores promised). During May of this year Zedillo visited the area and subsequently inaugurated the industrial plant. This business also invests in the production of chilies and tomatoes.

The former governor of Chiapas, Patrocinio González Garrido, has presumably been granted large credits for the production of eucalyptus on a large scale, for the production and commercialization of wood in the Northern Zone of the state. This kind of production is highly problematical, since it quickly and easily erodes the soil and impedes the planting of other crops. In the other extreme of Chiapas, the Industrial Fisheries Complex of Mayab, in the state of Yucatan, confirmed to the Chiapas government their commit to invest, in the future, US$15 in a company for comprehensive fisheries development in Puerto Madero, including a dry dock, ice factory, diesel tank, processing plant for fish products and commercialization of international markets. Puerto Madero, abandoned, is trying to become an industrial corridor.

The national producers Union of Rubber expressed their willingness to work with the government and to make inroads in Chiapas. Likewise, 20 of the most important businessmen in Mexico announced they would invest 10 million dollars in the agricultural sector, primarily in irrigation systems. Other investments in the state are: a cement plant in the municipality of San Fernando; a paper factory in Tuxtla; a recycling plant in Tapachula; Mexican Kenworth, which plans to erect an assembly factory in the Soconusco region in order to enter the Central American market; the Afra Group has begun the construction of a Sam's Club store in Tuxtla, investing 11.4 million dollars and generating 300 direct jobs (0.1% of Albores' promise); a clothing maquiladora which will create 100 jobs (0.03%), and which President Zedillo himself opened in April.

The businesspersons of the Management Council of the Mexican Republic (COPARMEX) created a Consulting Council for the development of municipalities in the Chiapaneco southeast. Later, the Regional Center for Business Competitiveness (CRECE) had helped 54 Chiapaneco businesses with consulting, production, human resources, finances and marketing. In April, more than 1560 unpaid debts were credited, with interest penalties being written off in amounts up to100%. However, this did not stop 830 businesses from closing, as was reported for the month of June.

The PRODUCE FOUNDATION, since its creation in 1996, has had a budget in the state of approximately 8 million pesos, distributed among 64 investment and technology transfer projects in the agriculture sector, in such areas as genetically altered maize seed, made more resistant to acid soils; the establishment of regulations for combating the more common diseases in plantations such as banana; livestock sanitation; work benefiting the coffee, cacao, soy, beans, vegetable and floriculture industries; investigation programs into the production potential in the Coastal Zone. Thus, Chiapas is an interesting experimental camp for businesses for scientific research into genetically improved seeds and for bio-diversity investigations.

The CHIAPAS FUND is made up of Mexican companies: Escorpión Group and Pepsi, Modelo Group, Mexican Development Group, Minsa Group, Maseca group and 12 other Chiapaneco businesses, along with the financial groups Serfín, Bital and Bancrecer. Many have done little. The Minsa, Maseca and Bital Bank have increased their credits, and they have taken on new members with 5 million dollars, which has increased this business organization's capital to 10 million dollars. Minsa and Maseca invest heavily in their production plants in the municipalities of Arriaga and Ocozocoautla. The Empresa Promotora Marañon S.A. of C.V.'s new plant (Indian nut) has an annual capacity of 1500 tons, which would allow it to buy the entire state's production. It is currently calculated that there are168 export businesses in the state.

The CHIAPAS FUND received a direct foreign investment of 5 million dollars from the International Financial Corporation for Latin America and the Caribbean, which is added to the fund's 7.8 million dollars. In 30 months of operation, the Investment Fund, initially capitalized with the equivalent of 2.3 million pesos, has made only 4 investments in private businesses: 1) a commercial agricultural export company; 2) Rubber Plantations of Palenque, S.A. de C.V., which will allow imports to be reduced by 100 million dollars in the country; 3) a plant producing Indian nuts (developed by Marañon); 4) the first shrimp farm in the state (laboratory for post-larval shrimp). These programs could generate 1446 direct jobs and 3357 indirect jobs (1.6% of Albores' expectations). In June the CHIAPAS FUND laid the first stone for the Processing plant for African palm oil in Villa Comaltitlán, region of Soconusco, which will have an investment of 36 million pesos with an annual capacity of 16 tons. They hope to bring this to 50,000 in two years, benefiting 500 ejido members. PROPALMA will be functioning in June of 1999 when the product is ready to be processed, and this will lower the import of vegetable oil to 12% to 14% in the country, with an actual worth in the market of 60 million pesos, since it currently reaches 1200 million dollars per year. With this plant, and other projects, employment could reach 8000 in the next two years (2.6% of the government objective), and they hope to promote 4 businesses per year beginning in 1998. At this pace, approximately 60 years would be necessary, with an average of 500 jobs annually, to reach Albores' goal.

The Secretary for Economic Development in the State of Chiapas confirmed the "possible" investment of 245 million dollars in Chiapas over the next few years in 6 programs, which would employ 5000 persons (1.6% of Albores' plan). In two years they hope to finalize 8 more projects, bringing the total to 15, which would generate 1500 jobs (0.5% of the governor's expectation).

The representative of the Council for African Palm Oil Producers of Malaysia, Franz Groeger, stated that, in Latin American, Columbia stands out in the production of African Palm. Malaysia cultivates 2.5 million hectares, producing 8.3 million tons of oil (more than 50% of world production), and contributes 35% of commercial oil. In addition, it creates 300,000 jobs in its country (the totality of Albores' goal), and it contributes 8% of the GNP. In Chiapas, Malaysia will invest in increasing the production of African Palm. The state government, in 1997, promised to establish 4000 hectares for its production. Similarly, Guatemalan businesses are planning to invest in the palm in the Soconusco region.

Why so much interest in the production of African Palm in Chiapas? African Palm is cholesterol-free, contains high levels of vitamins, and it is immune to pests, facilitating its single-crop plantings. It is one of the richest resources, and its planting covers more hectares in the state than any other product. It produces high returns, employs little labor, does not require many chemical products and is a low-risk venture for the businessman. The campesino gives his land and his labor, but he is not master of the production process, only of the extraction of the fruit. It takes a advantage of the cheap labor offered by migration in the border area. As for the day laborers from the Guatemala border, those who are lucky are paid 32 pesos per day (3.20 dollars), without food, and they even contract with children. There have been instances in which the Guatemalan authorities have had to intervene in order to ask that their laborers be paid.

According to the CAUSAI-CEDIS organization of Ecuador, African Palm produces oil for cooking, margarine, soap, detergent and glycerin, which is also used for military rocket fuel. However, its cultivation requires that forests be completely razed, and it needs an extensive highway network. In addition, the toxic wastes from the refining of the oil heavily contaminate the rivers. In Africa, after they were no longer productive, many areas cultivated with African palm became deserts. Curiously, in Ecuador, the production of African palm is closely tied to the military.

Mexico imports 800,000 tons of oils and fats annually, and up to now they have only been produced in Chiapas. Mexico is the second greatest buyer of African Palm on the continent after the US. It is calculated that there is the potential in Chiapas for producing an estimated 940,000 hectares of African Palm between the North, Selva and Coastal Zones. One hectare produces 20 tons of fruit and 5 tons of the oil, at a cost of 4500 pesos per ton, and, currently, 1800 tons are being produced (15% of the national consumption). The government is attempting, for the end of the century, to have 35,000 seeded hectares for the 4 oil extraction plants located in Villa Comaltitlán and in the municipality of Acapetahua, although currently there are only 2478 hectares planted. According to official sources, over a 49 year period, only 2748 hectares have been planted with African palm. In 1997 they had hoped to establish 4000, and the government channeled 16.3 million pesos for the purpose of achieving some 21,000 hectares by the year 2000. Later, Governor Roberto Albores announced an investment of 2 million dollars and a goal of around 25,000 hectares for the year 2000, which could create 15,000 jobs (5% of his goal). In the Soconusco region alone it is possible to cultivate 50,000 hectares.

The government is playing its own role. Through the Department of Economic Development and the Technological Institute for Superior Studies in Monterrey (ITESM), it has been reported that since last year there has been a development plan designed for the nine economic regions of Chiapas. In addition, other activities are promoted: an advisory group on airports is currently investigating the airport situation; tariffs are exempted and obstacles and taxes for foreign investment are removed, new conditions and regulations are placed on foreign human rights observers; the CACAOS FINOS DE CHIAPAS company, which is now in the hands of the Treasury department, is put up for sale to foreign or national businesses for $800,000; the Political Constitution of Chiapas is revised, with votes from only the official party, allowing the Executive to award concessions to individuals for the delivery of public services in any dependency or entity of the state public administration that they so deem; the State Congress similarly approves a law for the construction of a state business with majority participation, so that one sector might manage para-state businesses as a private enterprise, and, days later, it is awarded the ability to operate, administer and manage airports, air fields and landing strips in Chiapas; later the federation puts out 4 airport packages and 35 terminals out for bid, without veto, among them the airport in Tapachula, Chiapas. For their part, Treasury authorities favor the agricultural sector through a simplified method of payroll tax, and, in the case of the ranchers, they implement a simplified form for the entire contribution. Bars, businesses and hotels also receive benefits, with other terms.

In order to provide legal security and to encourage investment, the Mexican government established, as a consequence of the Free Trade Treaty, the Program for Certification and Ejidal Rights (PROCEDE), as the next step after the modification of Article 27 of the Constitution regarding land. With this program the government delivers ownership titles to the ejido members, so that they can now sell or lease their land, previously prohibited by law. In Chiapas this has reached only 25% of all the ejidal and communal lands (more than 400,000 hectares), but it is expected to be completed by the year 2000. Of the 7.5 million hectares in Chiapas, 40% is ejidal, 13% communal, 33% private, and the rest is water and ecologically protected zones. 75% of the land in Chiapas remains to be "regularized" (potentially able to be leased or sold), which would guarantee the investors' confidence. This is another reason for the delay in the arrival of investment.

However, the Business Coordinating Council (CEE) believes that the economic resources delivered by the government through the PROCAMPO program (money given to every campesino for each hectare committed to the planting of maize) promotes fires since, in order to increase cultivatable land, the owners de-forest more hectares and thus obtain more aid from the government. These businesspersons also believe that PROCAMPO encourages the leveling and burning of lands so that they can be parceled (the division of land by which each campesino can rent or sell) and individually titled, since the titling and division of forest lands is not allowed, and they must be incorporated into communal properties of either ejidos or communities.

In the field of Tourism, the government promotes ecotourism projects such as the Nachig corridor in the municipality of Zinacantán, the Rancho Nuevo caves in San Cristóbal de las Casas, the Tziscao Lakes Ecotourism Center, investment in the Sumidero Canyon, the ecotourist centers Escudo Jaguar and Las Guacamayas in Ocosingo, Agua Clara in Salto de Agua, Laguna Verde in Coapilla, Santo Domingo and Laguna de Colón in La Trinitaria. Three hundred million pesos will be allocated to the Mayan World Route which goes through the states of Quintana Roo, Yucatan and Chiapas (converted into a drug trafficking route, according to the head of the 10th Military Region, General Gastón Menchaca Arias), and which is expected to generate approximately 50% of the country's currency, since it created 7.593 billion dollars for all of Mexico on 1997, according to official figures. For 1998, 160 projects are planned for the Route, and an investment of 6 million dollars for Chiapas. The Tourism Sector in the country will invest 8000 million dollars for the 1998 - 2000 time period. Nonetheless, the relationship between the government, businesses and campesinos for the ecotourism projects is not completely to the liking of the indigenous, who accuse one company of wanting to lease the campesino tourist complexes of Misolhá, Agua Azul, Agua Clara, Frontera Corozal and Reforma Agraria, for 40 years, obtaining complete control for just 14,000 pesos per month for the campesinos.

Businessmen's complaints are well attended to by the government. They have made three fundamental demands: 1) certainty in the safeguarding of public security, and the government allocates more funds to police bodies, as we have already noted in other Bulletins; 2) legal security for ownership in order to be able to invest, leading to the PROCEDE, and; 3) highways, which the government heavily funds, for the construction of the stretches from Tuxtla-Mexico, Fronteriza Sur (integration of the Northern Zone and Tabasco, 424 kilometers); Tuxtla-San Cristóbal de las Casas (45 kms.), Soconusco-Costa-Arriaga-Ocozocoautla (93 kms.); Tapachula-Ciudad Hidalgo (36 kms.), Angel Albino Corzo-Siltepec (49 kms.). In January of this year, former governor Julio César Ruiz Ferro said federal investment in Chiapas over the last 3 years in communication and transportation had translated into 3400 kilometers of highways and roads, 311 new bridges and 2 new airports. The network of highways will be one of the indispensable means for attracting investment and tourism.

The government favors those campesino projects which can already bring important capital into the state. Such is the case with the Indigenous of the Sierra Madre of Motozintla (ISMAM), who won the First International Trophy for the best image in 1998, given by the Business Leaders Club in Geneva, Switzerland. ISMAM Coffee is the first Mexican export business of packaged organic coffee to export to Argentina, which will create 352 million dollars for Chiapas. In 1997, the BANRURAL bank allocated $951,000 for the acquisition of a roasting plant of Brazilian manufacture, with a capacity of 113,000 quintals [@100 lb.] of organic coffee for export annually. This organization states that it has more than 1500 producers in 19 municipalities in the Soconusco, Sierra and Coastal regions in the state of Chiapas, producing approximately 45,000 tons of organic coffee per season. They exported a little more than 26,000 tons of that coffee during 1996, creating around 5 million dollars per harvest. In April, President Zedillo opened a coffee maquiladora in the municipality of San Fernando, owned by campesinos exporting to New Zealand, Japan and the United States. In the Sierra de Motozintla, on the Guatemala border, BANRURAL helps an indigenous society, Knan Choc, which exports organic potatoes.

Through the State Mining Council, the government is working on a monograph on basic geological-mineral information, in order to see what there is in the ground and to tie the government to the private sector. Mineral exploitation is currently almost non-existent in Chiapas, but important mineral districts have been detected in the municipalities of Solosuchiapa and Chicomuselo, close to the border with Guatemala, where there is gold, silver, copper, lead and zinc: 4 mineral zones in the municipalities of Ostuacán, Tenejapa, Arriaga; and in the Soconusco region, where aluminum, quartz, silicone, iron and a belt of copper of more than 100 kms., have been located, according to the Secretary of Economic Development. However, aluminum and uranium deposits have been explored since 1983 by the Mineral Resources Council of the federal government in Tenejapa, as have others located in an area of San Juan Chamula and Ostuacán. It is worth remembering the declaration by Comandante Julián, of the EZLN, concerning the zone of Taniperla, to the effect that the militarization was motivated by the protection of the uranium in this Canyon. But it is not just the sub-soil natural resources, but also those of the water; at the beginning of this stretch of land lies the Osumacinta River, joining the Railroad which passes through Palenque and Tenosique in the state of Tabasco, and which also joins the southeastern project known as the Tri-National project of the Osumacinta and the Mayan World Route, with heavy direct foreign investment interests.

Large United States, Canadian, European and Asian businesses see the great potential of the rivers and waters such as the Osumacinta, Tzaconejá, Tulijá, Chancalá, Agua Azul, Izantún, the Grijalva and the Río la Venta, among others, through which they can move their products to the north, the south and from one side to the other of both oceans, in the logic of the free trade treaties and the inter-ocean project. In addition, there are the great oil reserves in Ocosingo, part of Chilón and in other municipalities in the Northern Zone, where there are also large natural gas reserves, as in the municipality of Simojovel. There are also the cloud forests which Pronatura has been exploring and trying to protect in the zone of Tila, Tapalapa, Tenejapa, Simojovel, Chilón, Ocosingo, Pueblo Nuevo, Solistahuacán and Chalchihuitán, among other corridors of bio-diversity and genetic explorations; forests which enter into the large interests of future projects, such as the construction of hydro-electric dams in the canyons - which will alter ecosystems -, the seeding of large plantations, communication waterways and subsoil resources. In the experimental camp, Rosario Izapa, of the National Institute for Forestry, Agricultural and Livestock Investigations (INIFAP), for biotechnology investigation and development, the government is carrying out genetic research for the improved development of the previously mentioned crops: coffee, African palm, rubber, bananas, cacao, mangoes, rambután and maize.

The rich deposits of gold, silver and uranium can also be exploited by private initiative, not just in Chiapas, but also in the states of Guerrero and Oaxaca. But globalization has one great enemy: the Indian nations, the "firebreak" nations and the struggle for their autonomy. If globalization's inevitable dynamic understands that it is necessary to create inclusive relationships for the exploitation of natural resources, a different horizon might be in store for the current conflicts and for the Indian peoples.

by Onésimo Hidalgo Domínguez and Gustavo Castro Soto,
Center for Economic and Political Investigations of Community Action, A.C. (CIEPAC)

Notes: The sources for the figures are from the local and national press.

(*) In order to covert pesos to dollars, the actual exchange rate is close to 10 pesos to $1USD.

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