Mexico to raise wages Move addresses U.S. concerns


MEXICO CITY -- President Carlos Salinas de Gortari yesterday announced a complex plan to raise Mexican wages and bolster the nation's economy. His proposals address United States concerns about American jobs displaced by cheap Mexican labor and lay the groundwork for the 1994 presidential election campaign.

At a ceremony in Los Pinos, the Mexican White House, Salinas said the complex package of economic measures would allow Mexico to "harvest and use the advantages" it earned in five years of fiscal discipline. In that time, inflation has been trimmed to a single digit and Mexico's foreign debt has been substantially reduced.

The stimulus package includes individual and corporate tax cuts, lower prices for industrial electricity and diesel fuel, lower cargo rates at the nation's airports and on its railroad, and accelerated corporate depreciation for investments like environmental controls and motor vehicles.

Those measures are being taken in addition to wage increases, which for the first time will take into account Mexican workers' increasing productivity -- a promise Salinas made to President Clinton as side agreements on the North American Free Trade Agreement were being negotiated.

But yesterday, Salinas made a point of saying his actions were directed at the internal market "independently of external business circumstances or accords."

The cost of the package is thought to be roughly $6 billion, which equals the federal budget surplus that Salinas has said he plans to use.

He has been criticized for waiting until now, just before the start of the election campaign, to start spending the money. Although he is prohibited from running for re-election, his party, which has governed Mexico for more than 60 years, has a lot at stake.

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