Mexican Finance Minister Jesus Silva-Herzog will travel to Tokyo Saturday in an attempt to secure $1 billion in Japanese loans and investments, Mexican and Japanese government sources said today.
Silva-Herzog is scheduled to meet Monday with Japanese Prime Minister Yasuhiro Nakasone for the first of a week-long series of meetings with Japanese officials, bankers and industrialists, a spokesman for the Japanese Embassy here said.
Japanese government sources said they expect Silva-Herzog to ask for more than $300 million in trade credits for the construction of new Pacific pipelines and oil-loading facilities, plus a similar amount for a long-postponed expansion of a Pacific Coast steelworks. In addition, Japanese banks expect to be asked for $400 million in new direct loans, Mexican Finance Ministry spokesman Rafael Resendiz said today.
Japanese officials "are waiting to see what concrete projects and credits the Mexicans put forward," said a high-level Japanese diplomatic source.
According to one Japanese government source, Mexico has suggested that some of the loans could be repaid with oil exports. The Mexican oil-credit proposal "is still in a preliminary stage" and might be discussed at a meeting planned for Tuesday with officials of the Japanese Ex-Im Bank, an official of a Japanese foreign trade agency said.
Resendiz denied the reports, but said Mexico planned to ask Japan to increase its Mexican oil purchases, which would indirectly provide a guarantee for the repayment of new loans.
Japan now purchases an average 180,000 barrels of Mexican crude daily, making it Mexico's biggest oil customer after the United States and the only major Mexican oil client that has not cut back substantially on its purchases this year. With Japanese banks holding $16 billion of Mexico's $98 billion debt, Japan is surpassed only by the United States as Mexico's leading foreign creditor.
In recent weeks, with the world oil price plunge critically eroding Mexico's export income, Silva-Herzog has urged Japan and other industrial oil importers to direct part of their energy savings to debtor countries in the form of credits, investments and increased import spending. The finance minister has scheduled a meeting Wednesday with private Japanese bankers in which he is expected to discuss Mexico's quest for $2.5 billion in new commercial loans this year.
Some Japanese believed that the United States also was pressuring Tokyo to channel much more of its trade surplus toward Mexico and other Third World borrowers. "The feeling among a lot of Japanese businessmen here is that the United States is almost ordering Japan to lend more to Mexico, and Japan is going along," the Mexican representative of a major Japanese corporation said.
Mexican officials long have sought an increased Japanese investment presence in Mexico to counterbalance U.S. capital, which represents two-thirds of all direct foreign investment here. Japanese firms account for some $7 billion of Mexico's foreign investment, while West Germany, with $8 billion, is the second-largest investor in Mexico, according to Mexican government figures. Japanese companies nearly doubled their investments in Mexico during the 1978-81 oil boom, but largely halted their expansion following the 1982 debt crisis here.
Japanese companies recently rebuffed requests to increase their holdings in companies in which they are now minority partners with the Mexican government, sources close to the projects reported. "Their reaction was completely negative," a Mexican close to the negotiations said. "The Japanese have lost confidence here."