We will now look at just a few indicators of the crisis in the Chiapas economy in the second and third sectors.  We understand by second sector, industry, and by the third, everything related to services, such as insurance, business, credit, education, entertainment, public administration, communication and transport (these last two are the areas with the largest national investments in developing countries)

On balance, we can state that the transportation sector (buses, taxis, interstate buses, etc.) is going through a severe crisis, and has a large percentage of "gypsy" units, which also serve to strengthen the informal, or underground, economy and reduce tax collection;  unemployment rates are high, and self-employment in the conflict zones has fallen due to the presence of the armed forces and the displacement of the population;  20% of the industries have closed;  state property tax collection is running at a deficit because of the budget cuts;  diversion of resources and corruption have been difficult to reduce;  many municipalities are in civil resistance over the paying of electricity and property tax;  at least 172 organizations in El Barzon are running at a deficit, as well as in the restaurant industry;  15,000 domestic war refugees compete for land with the 18,000 Guatemalan refugees;  some illnesses, such as AIDS, have increased;  many schools have been closed by the conflict;  more than 100,000 hectares were burned in Chiapas during 1998, with the loss of great biodiversity resources, and the extinction of various flora and fauna.  Only the tourism sector has shown an increase in growth, between 40 and 70%.

Facing these municipal, state and federal budget deficits, President Zedillo has several options;  1)  increase and accelerate privatization,  2)  increase the taxable population,  3)  reduce social spending,  4)  seek more foreign loans,  5)  increase taxes,  6)  look for more sources for funding from multilateral bodies.

If you wish to go more deeply, continue reading.

TRANSPORTATION:

According to the Confederation of Mexican Workers in the state of Chiapas - CTM - 50% of the 30,000 service vehicles in Chiapas are gypsies. This gypsy service in the informal economy does not pay taxes in the state, a situation which has been facilitated by the state government, by allowing it and by granting licenses. For its part, the President of the State Auto Transportation Alliance states that in Chiapas an average of 4500 vehicles are providing unregulated transportation services, and they complain about Article  66 of the Transportation Law of the State of Chiapas, where it is established that transportation must be provided for free to members of the armed forces.

This sector also complains that just one 72 hour transportation strike, of which there have been several, carries a consequence of millions of pesos worth of losses, added to assaults, which have registered an increase of 40% in Comitan this year.

EMPLOYMENT AND WAGES:

While Governor Roberto Albores states that close to 500,000 chiapanecos do not receive one single centavo, the MECED (Minors in Especially Difficult Circumstances) says that the rate of underemployed youth has risen more than 100%.  For the CIOAC, the importing of 5 million tons of maize in 1998 to Mexico is equal to the creation of between 250,000 and 300,000 permanent jobs for 6 months, and would involve an expenditure of 8000 million pesos.

Facing the state's critical employment situation, the governor launched an Emergency Program to create 300,000 jobs over a period of three years.  If the majority of the Economically Active Population is involved in the rural areas, the revival of the sector, given the crisis it is experiencing, will not be easy, especially in the Soconuso region, where the conditions of employment are appalling.  An example would be the case of the coffee growing plantation, PRUSIA, which owed wages for more than 60 days to their workers, where thousands of undocumented persons compete for laborer openings.

SERVICES:

The Federal Electricity Commission (CFE) states that more than 400,000 users in Chiapas owe 45 mdp over four years.  Meanwhile, the Secretary of Urban Development states that Chiapas, despite its hydroelectric potential, only has a 59% service area coverage, when the national median is 84%. 

While the restaurant sector states that it has a deficit of 50%, the hotel industry, as part of the Mayan World, has grown between 40 and 50%, even reaching a 70% growth rate, according to the Department of Tourism. 

And so, the Department of Treasury sets itself against the debtors;  however, Banrural del Istmo has a deficit of more than 730 mdp in the states of Chiapas and Oaxaca, and BANRURAL reached 594 mdp in 1997;  the Barzon confirms that its 172 organizations also has their cartera vencidas.

INDUSTRY:

For the National Chamber of Industrial Transformation, "The industrial situation in Chiapas is critical because investments are not arriving, the market is depressed and one has to work three times as hard for the same results as before the 1994 crisis."  They see the necessity for restructuring credit.  The few industries have been battered, there has only been a local market, very little at a regional level and even less at a national since "it has been very affected by the events since 1994."  They stated that in Chiapas "in its entirety there are 8000 industrial establishments operating, of which 95% are micro-industries or single owner operations, the rest are small or middle-sized;  in 1997 15 industries went under, and from 1994 to the present 15 to 20% have closed, especially the micro-industries."

The National Construction Chamber (CANACO) calculates monthly losses at 10 mdp due to attacks on trailers or on businesses in Chiapas, and they confirm that 20,000 establishments in Chiapas have cartera vencida of 10 mdp.

TREASURY:

The state treasury, like the municipal treasuries, in Chiapas, finds itself running a deficit.  The Department of Treasury and Public Credit states that only 5% of the population have regularized as far as the filing of returns.  The government and the municipalities complain that the banks, PEMEX, Mexican telephone and the Federal Electrical Commission, have not paid their property taxes for some years now to the municipalities, such as in the case of Reforma.  However, corruption makes the municipal presidents prisoner regardless of the political affiliation which governs them. Campesino and indigenous organizations have taken over presidents' offices and have demanded clarification of supposed acts of corruption, theft, and diversion of resources in the majority of the municipalities, at a moment when the federation as well as the state are directing large sums of money to be administered by the same councils. In Oxchuc the PRIs complain of the diversion of resources;  in Tila they claim that potable water, public lighting and the hospital are not functioning;  in Cacahoatan they are requesting audits;  in Sabanilla they ask the governor to investigate the trustee for diversion of municipal funds, presumably by the PRI council, etc.

The country is 38 and 39% dependent on the sale of hydrocarbons, and, with the lowering of oil prices, the economic crisis could be aggravated with a third budget cut for the country.

Facing empty coffers, the municipal government of Tuxtla Gutierrez demands payment of property taxes, and has made 60 seizures of property this year from debtors in arrears.  On their part, the Department of the Treasury made a budget cut of 100 mdp, because of the lowering of oil prices;  but they said that "it would not affect social investment."  The deficit economy has been worsened by the civil resistance against paying for electrical energy and property taxes in at least 50 communities.  For some time now, the state government has exempted national and international private investment from taxes, and there have been complaints from chiapaneco businesspersons as to the unfair competition from these investments.

HEALTH:

The same official figures confirm that 11% of the population is without health services (out of 3.5 million inhabitants).  According to the Faculty of Medicine of the UNACH, there has been an increase over the last few years of malnutrition, diabetes, hypertensive arteriosclerosis, metabolic and degenerative illnesses, etc., in the marginalized areas.  The Department of Health has noted that, at the end of 1997, there had been a significant increase in AIDS cases, hemorrhagic dengue and pulmonary tuberculosis in Chiapas;  and that the number of children per woman is the highest in the country;  80% of the population in Chiapas - a little more than 3 million persons - lack real access to social security services, and, of those, 450,000 lack access to regular health services; in 1997 there were 55 registered cases of AIDS (14 more than in 1995).  It should be noted that, according to the World Health Organization, there are 200 unreported cases of AIDS for every one registered, which would lead one to assume that there are 11,000 persons affected in Chiapas.

If we add to this, not the conditions in which the approximately 15,000 Chiapas displaced are living, but rather the population of the more than 60 municipalities (out of 111), which live in the most alarming conditions of poverty,  we can see what little capacity the government has to care for the population, even less so during the rainy season which is approaching.

EDUCATION:

The situation in education is no less serious.  In Nuevo Limar, municipality of Tila, the primary school "Gabriela Mistral" is without teachers;  in Arrenza I and II of the municipality of Chamula, 30 children have been prohibited from being in school by evangelicals;  6 schools are closed in Chenalho (Polho, Acteal and Chimix:  3 primary and 3 nursery schools);  1000 children do not have access to basic education because of lack of security and attendance by more than 30 teachers in the Northern, Los Altos and La Selva zones;  30 groups are without classes, most especially in Las Margaritas and among the displaced in Chenalho;  3 schools closed in Las Margaritas because of the conflict;  in the municipality of Oxchuc, public security police have taken possession of the primary school in the community "Tres Nudos";  in February, 3000 students were affected by the strike of teachers in Section 40 of the National Union of Education Workers, where 3000 teachers mobilized simultaneously in the municipalities of Pichucalco, Simojovel, Palenque, Ocosingo, San Cristobal;  in May, another 2000 went on strike;  in May, the Education Services for Chiapas (SECH) confirmed that 11,000 of the 42,000 teachers in Chiapas were in work stoppage (teachers in the municipalities of Palenque and Salto de Agua won  an increase of approximately 1000 pesos per month, a little more than $100 monthly);  because of the police-military operations during the last months, school activities have been stopped in the municipalities of Nicolas Ruiz, Venustiano Carranza, Ocosingo, La Trinitaria, El Bosque, San Andres Larrainzar, Mitontic, Pantelho, etc., where, in many cases, the military and police forces have taken possession of the rural school facilities.

Education in the state is in the most serious condition where the following characteristics are present:  rural, indigenous, with the presence of zapatistas, paramilitaries, military police and autonomous municipalities.

In the case of housing, BANRURAL denied supports to Chiapas for the construction of 2400 houses, which would have amounted to an investment of 300 mdp, and would have generated 25,000 jobs; and for which losses can be calculated of 84 mdp for the builders, as well as thousands of jobs.

Lastly, let us look at the general picture of the victimized population.

MIGRANTS, REFUGEES AND DISPLACED:

The day laborers who cross the border from Guatemala, in Tapachula, are paid 32 pesos per day without food, including the hiring of children.  The Guatemalan consul in Tapachula states that 80,000 Guatemalan day laborers are working in ranches in Soconuso.  This is the labor which private investment wants to exploit, as long as the government provides adequate conditions for investment.

Another population which competes for jobs with chiapaneco campesinos, is the Guatemalan refugees.  The ACNUR stated recently that there are still 18,000 refugees in 5 municipalities in Chiapas, and since 1992 there have been 35 massive returns to Guatemala, although more than 4000 have decided to remain in Mexico.  Meanwhile, the Under Secretary for Population and Migration Services stated that, since 1984, 36,950 refugees have returned and 8000 more will do so before the end of 1998;  6000 Guatemalan refugees have received FM2 status, which will permit them to move freely throughout national territory and to acquire land and property for personal family use in any place in the country.

There are 107 camps for Guatemalan refugees in Chiapas in the municipalities of La Independencia, Frontera Comalapa, Las Margaritas, La Trinitaria, Bellavista, Amatenango de la Frontera, Chicomuselo and Frontera Comalapa, which authorities plan on closing by the year 2000.

The failure of the 15,000 displaced in Chiapas to return strongly affects local and regional production.  Those displaced by political violence in the area remain in regrettable conditions.  In cases where police-military operations have been carried out, the following results have occurred: education is interrupted, stores and cooperatives have been robbed, they have been robbed of their cash, clothing, personal belongings, domestic goods, food (coffee, maize, etc.), electrical appliances (televisions, radios), domestic animals (chickens, ducks, horses, etc.), school and personal documents;  houses, churches and fields are destroyed and burned; patrols are reinforced, impeding marketing, etc.  The family economy and minimal surpluses are completely eliminated: the revival of their economy will take years, let alone reach the level it had before the displacements.

Added to the previous, there is another issue which has heavily impacted on the state's economy:

NATURAL CATASTROPHES:

Storms have battered the state this year.  In the Northern zone, in the municipalities of Sabanilla and Tumba, 500 planted hectares were affected, and 100 houses damaged;  2 communities were affected in Tumbala;  800 persons were affected and 150 houses were damaged in Tila and Amatan;  in Chicomuselo 100 persons were affected and 114 properties in 11 towns;  in Pijijiapan, 176 properties, 2 communities, a thousand persons and 200 fruit trees were affected, without any government aid arriving;  in Villa de Acala damage occurred to at least 100 properties.

Given these circumstances, the governor is inaugurating a State Prevention Program for Hydrometerological Phenomena, since at least 17 events are expected, cyclones and hurricanes in the Pacific Ocean, and 11 in the Atlantic;  because of these, 46 municipalities could suffer flooding, such as Cintalapa, Tuxtla, Chiapa de Corzo, Soyalo, Tecpatan, San Cristobal, Villaflores, Bochil, Pichucalco, Jitotol, Ostuacan, Sabanilla, Ocosingo, Tumbala, Tila, Motozintla, Huehuetan, Tapachula, Tonala, Arriaga, Pijijiapan, etc.  These storms will bring even more flooding now, since, with the deforestation and fires, rainfall cannot be retained, consequently it will severely affect soil erosion.  The National Water Commission confirms that there is a risk of flooding in at least 30 towns.

However, even before the rains, the National Indigenous Institute calculates that due to the droughts, at least 7000 hectares (out of 20,000) had been which had been slated for support, will be affected.

Additionally, several earthquakes have been registered this year.  In the Coast more than 100 families saw their property affected, and, if that were not enough, the Vulcanology and Seismology Program of the state government began verification of a possible volcano in the municipality of Tila, because of the strong odour of sulfur.

However, the fires have had the strongest impact.  Already in January of 1997, it had been stated that "each year the deforestation in Chiapas reaches some 4500 hectares, which are deforested through the firing of tiles and bricks in the more than 500 ovens existing in the area.  Meanwhile, in the last 6 years, 240,000 hectares of trees were razed in Chiapas, among them those used to fire tiles and bricks.  Fourteen hectares are razed every day to provide firewood for the brickmakers."  In addition, in the Selva Lacandona we had 2 million hectares in 1950, compared with the 500,000 remaining in 1998.  To this survey, we can add the following:

More than 100,000 hectares have been damaged so far this year in all of Chiapas due to the more than 300 fires.  This includes 3200 hectares in the Coast;  more than 160 forest fires have turned 20,000 hectares to ash in the Canon del Sumidero;  in Cintalapa between 65,000 and 75,000 hectares of forest, selva, pasture, shrub and scrubland have been affected, which will take between 25 and 50 years to restore.  Among the municipalities most affected are Chanal, Las Margaritas, La Independencia, La Trinitaria, Copainala, Siltepec, Cintalapa, El Bosque, Tila, Tumbala, Sabanilla, Ixtapa, Ocosingo, Palenque, Ocozocoautla, Ostuacan and Reforma, among others.  3631 firefighters were used, of which only 428 were soldiers, of the more than 40,000 in the state.

Also affected have been the ecological reserves of El Trinfo (1495 hectares), El Ocote (4000 hectares), Montes Azules, La Sepultura, Cojolita, Chimalapas (45,000 hectares), devastating flora and fauna that were already in danger of extinction, such as the tapir, the quetzal, wild boar, monkey, etc., and destroying 100 year old trees which only flower once.

The Natural History Institute stated that there are more than 1 million hectares in at least 10 reserves and biospheres which are protected for conservation, and which have been affected in the last 30 years;  more than 7000 hectares protected by the INH have been lost in more than 300 fires and droughts.  In the last few months, close to 7000 acres have been burned within the 4 reserves which the INH maintains (600in La Encrucijada;  779 hectares in La Sepultura;  2500 in El Ocote; and another 420 of shrub and 140 in other areas, where flora and fauna in danger of extinction exist).

The North American Commission of Forestry Services arrived at the end of May to help the problem in the Chimalapas, when the Mexican government leased the services of 4 Air Cranes at $5000 per hour.  By June 3 these aircraft had made 326 discharges of water in 60 hours during the first 12 days of their work, which meant for the government an expenditure of $300,000, equal to 2,700,000 pesos.

To deal with this, the authorities are planning to seed 270 million trees over 40,000 hectares in the country, with an investment of 258.1 mdp, which is an increase of 17% from last year.

At the end of May, it was reported that a record 12,000 fires, 50 deaths, more than 300,000 hectares of forest had been affected and the exhaustion of 350 mdp to meet emergencies (in 1988 there were 10,942 fires, with 518,287 hectares affected in the country;  in 1993 there were 10,251, and 235,020 hectares).

According to other sources, the forest wealth in the area exceeds 100,000 million pesos;  about 625 million pesos' worth of trees have been burned each year;  and in the last 3 years there has been about 16.8 million pesos invested for preservation and reforestation.

If the problem of the crisis in Chiapas is profound, historical and structural, it deserves a treatment of no less magnitude.  It would be very reductionist and simplistic to think that the crisis could be solved with just investment.  Looking at the problem as a whole will help us to find solutions as a whole.

Sources:  state and national press and statements from cited institutions.

(In order to calculate amounts in dollars, the conversion is 1 USD = 8.80 pesos average)

"THE INSUPPORTABLE LIGHTNESS OF THE LAW:  IMPUNITY"

(Extract, Part XII)*

g)      pillage

On February 5, 1997, "the soldiers violently burst into Piedra Blanca," municipality of La Concordia, where they looted all the houses "searching for weapons."  Along with officers from Public Security and the State Judicial forces, they took away 400 sacks of coffee and others of beans and maize.  In addition "they robbed 250,000 pesos which the government had given us for the construction of a school," denounced Oscar Toledo Ruiz, spokesperson for the Popular Campesino Union Francisco Villa (UCPFV).   (Lopez, J.   Proceso, #1065, 3/30/97,  p. 30)

The lootings, one by one, of 74 houses and 3 cooperative stores, with the brutality of destruction, pass before the witnesses eyes.  Mattresses ripped apart (where they had them), clothes torn up, utensils broken, certainly kicked to bits, papers burned;  ghosts of what they were missing:  in some houses for example, 1800 kilos of maize, a television, four machetes, 8000 pesos in cash.  Mariano, the owner, is in jail at Cerro Hueco accused of homicide.  The Assistant Judge for the municipality of San Juan de la Libertad and he lived in San Pedro Nixtalucum until his illegal arrest   (Bellinghausen, H.  La Jornada,  4/30/97,  p.1)

Some 300 members of State Public Security and members of the paramilitary group "Peace and Justice" "destroyed" or damaged 220 houses in the community of Shushupa, municipality of Sabanilla, in the north of Chiapas, local authorities stated.

(…) they also caused "severe material damage to the primary school there, they damaged the solar plant, and they stole 8500 pesos in cash during the looting" from two cooperative stores.

(…) "they butchered six head of cattle from a neighboring ranch, causing a loss of 14,000 pesos to the owner of the animals."

(…) as a consequence of the police operation, 510 residents of Shushupa fled to the mountain or to neighboring communities, where they have taken refuge.   (Henriques, E.   La Jornada,  8/9/97,  p. 11)

The women of Las Can~adas denounce their losses in a statement.  The adults were in Nueva Esperanza (municipality of Altamirano) on January 1, when the community fled to the mountain:  the soldiers ate 50 of the women's collective's chickens, from which they robbed a television, a VCR and 20,000 pesos;  sacks of maize, beans, sugar, rice and salt were thrown on the floor and tossed with gasoline;  the gasoline contaminated the water jugs;  in the houses they robbed record players, machetes, hatchets, money, then they threw clothing and suits on the floor, defecated on them, and spilled gasoline on them.  They stole two chainsaws, sound equipment, medicine, cattle, 17,000 pesos from the cooperative.  On January 2, women from 13 communities arrived swiftly, children in their arms, in support of their compan~eras in Nueva Esperanza.  They were threatened with being "auctioned off" and raped(…)  En Las Can~adas, there is no food, but there is one soldier for each family.   (Castellanos, L.   Trip to the Center of Rage.  Doble Jornada.  La Jornada (3/2/98,  p. 11)

With an unswerving dedication to peace among the Mexicans and with respect for human rights, the federal Army resolutely supports the efforts to enforce dialogue, tolerance and negotiation, so that law and democracy will rule across all national territory.   (Ernesto Zedillo, President of the Republic.  1/19/98)

"It is to implement replacements, and not to avoid another Acteal 97, that the federal government is now sending thousands of soldiers to Indian territories and millions of dollars to state authorities who have discovered that war, but especially the dirty war, is very good business."   (SCI Marcos, for the CCRI-CG of the EZLN,  12/26/97)

·        Extract from the document, "The Insupportable Lightness of the Law:  Impunity;  Three Months From Acteal," from "Popular Alternative Communication, Working Group," from 4/11/98

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