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Whales, Salt, and Salinas in Mexico

Subject: Re: Whales, Salt, and Salinas in Mexico

Burma Readers, please add this to your Mitsubishi saga, in the hope it 
contributes to effective knowledge, dawn star, paris

from ENVIRONMENT IN LATIN AMERICA NETWORK <elan@xxxxxxxxxxxxxxxx>
Serge L Dedina wrote:
>                           by Homero Aridjis
> (Note: This is an English version of an article which first appeared in
> Reforma, Mexico City, March 10, 1996. Homero Aridjis is president of the
> Grupo de los Cien Internacional).
>      For nine years Francisco Guzman Lazo served as general
> director of Exportadora de Sal, S.A., (ESSA, a joint venture 51%
> owned by the Mexican government and 49% by Mitsubishi
> Corporation)  and for seven years as president of Baja Bulk
> Carriers, the Liberian-flagged company which does all the deep-
> sea shipping to Japan, the United States and Canada of salt
> produced in Guerrero Negro. He has now voiced his concern about
> the mysterious "third partner" in the "Salitrales de San Ignacio"
> project. This new saltworks, which was first proposed by ESSA
> during Carlos Salinas de Gortari's presidency, would be built at
> the most pristine of the gray whale calving lagoons in the
> Mexican state of Baja California Sur. The project would violate
> existing Mexican laws, because San Ignacio Lagoon is located
> within the Vizcaino Desert Biosphere Reserve --Latin America's
> largest protected natural area --, which was  established by
> Mexico in 1988,
>      Based on his broad knowledge of the production methods and
> productive potential of the existing saltworks at Guerrero Negro,
> of deep-sea salt shipping, commercial distribution channels, and
> the nature of supply and demand in the international markets ESSA
> serves, Guzman Lazo has concluded that THERE IS NO NEED FOR A NEW
> SALTWORKS IN BAJA CALIFORNIA SUR. On the occasion of a public
> hearing on the project held on February 29 in La Paz, BCS, by the
> National Institute of Ecology (INE), he called both environmental
> impact studies -- the original EIS rejected by INE on February
> 27, 1995, and the new EIS commissioned by ESSA --  "superfluous
> and costly technical-scientific exercises"  In two letters
> addressed to Mexican president Ernesto Zedillo he has urged the
> project's cancellation, warning that if it is carried out ESSA's
> liquidity will suffer, the only public sector company in Mexico
> which has operated since 1975 without loans, transfers or
> subsidies will go into debt, needless environmental damage will
> be caused in a large area around San Ignacio, the volume of salt
> produced for international markets will increase unnecessarily,
> provoking a price war among producers, pushing prices downwards
> and upsetting the stability of ESSA's traditional markets, and
> the company will inevitably return to its pre-1975 unprofitable
> condition.
>      Moreover, he has pointed out that "There is no market for
> the excess salt which would be produced at "Salitrales de San
> Ignacio," as Japan's salt imports from all its suppliers have
> remained virtually stationary since 1991, and Mexican exports to
> Japan have even tended to diminish.  ESSA's sales over the past
> 18 years totalled 92.63 million tons, averaging 5.15 million tons
> a year, while its annual production capacity is above 6 million
> tons, leaving sufficient reserves to cover any occasional
> additional demand.  Also, the delivered price of Mexican salt in
> Japan went down from 3,818 yens a ton in 1991 to 2,508 yens a ton
> in 1995, a reduction of 35%.
>     Guzman Lazo is convinced that neither of ESSA's two
> shareholders would be willing to put up the $120 million for
> "Salitrales de San Ignacio."  A source at the Mexican Commerce
> Secretariat (SECOFI) recently told him that its deputy in ESSA, a
> trust known as Fideicomiso de Fomento Minero which promotes
> mining in Mexico, will not underwrite ESSA's expansion plans.
> Mitsubishi would become majority shareholder if the Corporation
> were to finance the new saltworks, but it is more to Mitsubishi's
> advantage for the Mexican government to be majority owner as the
> government takes care of any financial, social or labor problems
> which may arise. What Mitsubishi wants is to have the salt in
> Japan. For strategic reasons Japan cannot depend on a sole source
> of supply, and other Japanese companies have sea salt ventures in
> Australia.  Mitsubishi's only reason for accepting the project
> would be to drive down the price of salt.
>     Guzman Lazo argues that putting the company into debt to
> receive marginal negative profits is unthinkable. nor is there
> any reason to share the annual net profit of $20 million which
> ESSA's two partners now receive from its $86 million sales with a
> third partner who, as majority shareholder, would be entitled to
> the lion's share of the returns.  The arrival of a third partner
> would mean the government's loss of control over the company and
> reduce the income from taxes and substantial dividends it has
> been receiving for the past 20 years.  Control would also be lost
> over a pivotal part of the Baja California  peninsula which is
> vital to national security and sovereignty.
>      A number of questions spring to mind: Who is the third
> partner and why is he eager to invest $120 million in a project
> that won't work?  Who has $120 million handy in the midst of a
> nationwide economic crisis?  In their eagerness to do business
> and jeopardize the gray whale, the Vizcaino Desert Biosphere
> Reserve and the local fishermen, are Mitsubishi and the Mexican
> government willing to take money of doubtful provenance and
> further damage their reputations?  Does Mitsubishi want to commit
> hara-kiri at San Ignacio? Is ESSA planning to ultimately replace
> the existing saltworks at Guerrero Negro with the new one at San
> Ignacio, causing irreparable environmental harm and turning
> Guerrero Negro and Isla de Cedros (site of the terminal for
> shipping salt to Japan) into ghost towns? What will happen after
> the government has handed over 100,000 hectares to ESSA, turning
> a large part of the Reserve into a no-man's-land where trucks,
> ships and planes come and go at will? In the March 1 issue of
> Reforma, this area is identified as part of a major drug-running
> route.  Cocaine is dropped at Guerrero Negro, to be moved north
> to Ensenada and Tijuana, on the American border.  According to El
> Financiero (February 15, 1996), one of Mexico's "black holes,"
> where low-flying planes are not picked up by radar, is located
> "at the meeting-point of the states of Baja California Norte and
> Baja California Sur, in Ojo de Liebre Lagoon -- the famous gray
> whale sanctuary ---, Guerrero Negro and part of the Vizcaino
> Desert."
>      The Mexican government would also do well to clarify whether
> the fishpacking plant on Isla de Cedros, which formerly belonged
> to the state-owned Productos Pesqueros Mexicanos, was bought by
> Raul Salinas de Gortari or anyone else associated with him, and
> to investigate whether ESSA has been a consultant to the 50,000
> tons-a year salt-producing operation on Isla del Carmen, widely
> believed to be owned by Raul Salinas. Under what circumstances
> were Raul Salinas de Gortari and his family photographed standing
> on one of ESSA's crystallization ponds, wearing windbreakers and
> caps emblazoned with the ESSA logo (Actual, October 1995)?.
>      Guzman Lazo believes the final say on ESSA's expansion
> project is beyond the scope of SECOFI and SEMARNAP.  It has
> become a matter for the Defense and Interior Secretariats.  There
> are reasons to believe that more than salt (that not only salt)
> will be laundered at San Ignacio Lagoon.