Shultz Sees De la Madrid, Praises Austerity Program

Secretary of State George P. Shultz met Thursday with President Miguel de la Madrid and praised Mexico’s newly announced economic austerity program.

Officials said the two nations remained at odds, however, over the issue of U.S. negotiations with leftist Nicaragua, talks that Mexico has urged and the United States has rejected.

Shultz, in Mexico for a regularly scheduled meeting with Mexican officials, was briefed on the economic measures announced Wednesday, including a 20% devaluation of the Mexican peso and a cut of about $500 million in Mexican government spending.

“We consider these steps to be important and significant,” Shultz said. “They should have . . . beneficial effects, both immediately and in the long run.”

Appeal for Talks

On Central America, De la Madrid and Mexican Foreign Secretary Bernardo Sepulveda repeated their appeal to the United States to resume bilateral talks with Nicaragua, which the Reagan Administration suspended, citing Nicaraguan intransigence.

Shultz turned down the Mexican appeal, saying the United States will not meet with the Nicaraguans until the Sandinista regime agrees to negotiate with the U.S.-backed rebels, or contras.

Shultz and De la Madrid also discussed President Reagan’s planned visit to Mexico later this year, although Shultz said no date has been set because Reagan’s doctors “are holding him back.”

Other topics covered included narcotics enforcement, fishing disputes and environmental issues, particularly U.S. concerns about cross-border water pollution from the sewage of Mexican towns.

An official in Shultz’s party said the United States is pleased with the results of a recently concluded agreement to improve Tijuana’s sewage system and hopes to use the pact as a model to make similar improvements in Mexicali, across the border from Calexico, Calif.