The Mexican government is cutting back on its activist role in Central America because it is frustrated at the lack of progress in peace talks there and because it needs to concentrate more on solving its own economic problems, senior Mexican administration sources said today.
Mexico also will take a harder line in coming months in negotiations over repayment of its $96 billion foreign debt, the sources said. President Miguel de la Madrid will ask President Reagan at a meeting on Jan. 3 to support new measures to ease Mexico's debt burden, and the Mexican may propose a ceiling on interest rates for some loans, they said.
Mexico has been one of the leading members of the the Contadora group, which is seeking to negotiate a general peace agreement in Central America. It will continue to participate but is placing a lower priority on that effort, the sources said.
They said that none of the parties involved in the conflicts in Central America -- including Nicaragua and the United States -- has "the political will" to reach a settlement.
The Contadora talks have reached a deadlock in recent weeks after the group failed to meet a self-imposed deadline for a peace treaty.
The sources, who are close to de la Madrid, described these shifts in approach to Central America and to the debt issue when asked in an interview about Mexico's hopes for the scheduled meeting between the two presidents in the Mexican border city of Mexicali.
In sharp contrast with the four previous meetings between de la Madrid and Reagan, the Mexican leader may not even raise the issue of Central America at the session, the sources said.
"We're not going to have a meeting with President Reagan to insist on discussing a problem that nobody wants to solve," a senior Mexican official said of Central America.
Instead, the official said, "We have great hopes that this meeting will be the start of negotiations for new financial relations between Mexico and our creditors." Under these new relations, he said, Mexico would be granted additional time to repay its debt and would be guaranteed fresh foreign loans in 1986.
Mexico's new approach comes in response to several fundamental developments in recent months, according to the Mexican sources and to foreign observers. These include the current stalemate in Central American peace talks, a substantial worsening of Mexico's economic performance, and the proposal by Treasury Secretary James A. Baker III for new commercial lending to help Latin America with its debts.
These developments apparently have led Mexico to seek a kind of trade-off with Washington. Mexico seems to be saying that it will stop working so hard to champion the cause of Nicaragua in the peace talks -- which are not going anywhere anyway -- and it hopes that the United States will respond by giving it more help in managing its debt.
Another factor in the debt negotiations is domestic political pressure on the government to seek more concessions. The officials noted that other Latin American debtors, notably Peru and Brazil, adopted tougher bargaining positions this autumn.
The Mexican officials' comments confirmed previous indications that the government was trying to narrow the gap with Washington on Central America. Mexico has cut sharply its oil shipments to Nicaragua during the past year, for instance, and it has patched up relations with El Salvador's U.S.-backed government.
The Contadora group includes Colombia, Venezuela and Panama as well as Mexico, but Mexico has irritated Washington by serving as the group's leading defender of Nicaragua's interests.
For example, at their last meeting in May 1984 in Washington, de la Madrid successfully urged Reagan to begin direct talks with the Sandinista government. The talks were held at the Mexican Pacific Coast resort of Manzanillo until Washington suspended them in January. Earlier this week, de la Madrid indicated that Mexico was drawing back a step from Central American peace efforts when he emphasized in an interview with the Mexico City newspaper Excelsior that Mexico's foreign interests were not limited to Contadora alone.
So far there has not been any sign of a shift in Mexico's positions within the Contadora group itself. In recent days, Mexican diplomats have fought hard at the United Nations and at a meeting of the Organization of American States in Cartagena, Colombia, on behalf of resolutions that were favorable to Nicaragua.
But these efforts appeared to be holding actions designed mainly for public relations purposes. In addition, Mexican Foreign Secretary Bernardo Sepulveda is known to be more enthusiastic than other members of the government, including de la Madrid, about pursuing Contadora peace efforts.
"Sepulveda has to give the appearance of trying as long as he can, but he knows it's a losing battle," said a diplomat who monitors Contadora.
Nicaragua has said that it will not sign a Contadora peace treaty unless the United States pledges to halt support for the Nicaraguan antigovernment rebels. The United States has rejected that demand, so prospects for a Contadora accord appear to be nil.
Regarding the coming meeting between de la Madrid and Reagan, the Mexican sources emphasized that they did not want differences over Central America to detract attention from what they called the more pressing issues of U.S.-Mexican bilateral relations.
"There is no purpose in dedicating this meeting to Central America when it is more important for Mexico to discuss its own problems with the United States," an official said.
He listed the top issues of interest to Mexico at the meeting as the debt negotiations, immigration reform and trade. "If they have time, maybe they will also include Central America," he said.
Mexico is hoping that the United States will give it new support on economic issues because of recent steps taken by the government here to lower trade barriers and open doors to foreign investment. The U.S. government strongly supports these measures, particularly Mexico's recent announcement that it will subscribe to the General Agreement on Tariffs and Trade.
In particular, the official said that Mexico wants "more realistic terms for the debt," but he was not specific about what that would mean.
He said that the government might propose to pay fixed interest rates on some of its commercial loans, which would represent a sharp break with past policy.
Bankers prefer to set the interest on the debt as a floating rate that fluctuates automatically with other interest rates used as an index.
"It would be perfect if we could get 6 percent. The banks will not be very happy to do it, naturally," the official said. Another possibility was a mechanism to fix a ceiling on interest payments.
"What we want is a situation where we can breathe with more oxygen," the official said. "If we don't get help to grow, then we won't be able to fulfill our commitments" to repay the debt.