Intransigence Blamed in Latin Peace Deadlock

The intransigence of countries involved in Central American conflicts, including the United States, has all but exhausted the so-called Contadora countries’ diplomatic efforts to end the fighting there, President Miguel de la Madrid asserted.

In an interview with The Times last week, the Mexican president also defended his country’s electoral system, which critics say is rigged in favor of the ruling party, and his handling of the economy, which is in a deep recession.

De la Madrid is scheduled to go to Washington on Aug. 13 to meet with President Reagan for their second summit session of the year. Disagreement over Central American policy has been a longtime irritant in relations between the two administrations.

One of the Obstacles

De la Madrid made clear that he believes one of the obstacles to the Contadora talks is U.S. backing of rightist Nicaraguan rebels. The Senate is considering final approval of $100 million in aid to the contras, who are fighting the Marxist-led government of Nicaragua.

“It seems to me that the parties involved should refrain from any action that tends to heighten tensions in the area,” he said.

“The Contadora Group has made a maximum effort to promote negotiations,” De la Madrid declared. “I think now that the responsibility principally lies with the interested parties. Contadora is simply a diplomatic mechanism to favor dialogue and negotiation, but it cannot take the place of the political will of the parties concerned.”

Mexico has been the prime mover in the Central American peace talks, and De la Madrid’s comments reflect the growing sense that the effort is at an end. The initiative began in 1983 with a meeting on the Panamanian island of Contadora of the foreign ministers of Mexico, Colombia, Venezuela and Panama, the four countries in what came to be called the Contadora Group. The Contadora talks are aimed at designing a peace treaty involving Nicaragua and its neighbors, Honduras, Costa Rica, El Salvador and Guatemala.

In June, the talks reached a dead end as Nicaragua insisted on suspension of U.S. aid to the contras as a condition for signing any treaty. For their part, Nicaragua’s neighbors, at the urging of the Reagan Administration, are insisting that Nicaragua move its domestic political system toward genuine democracy.

Negotiation Urged

De la Madrid said that breaking the deadlock depends on talks not only among the Central American countries, but between the United States and Nicaragua. No such negotiations are under way or scheduled.

Relations between the United States and Mexico have been further strained in recent months by criticisms of Mexico voiced by several U.S. senators and officials of the Reagan Administration. During Senate hearings chaired by North Carolina Republican Jesse Helms, Mexico was attacked for its handling of economic problems, drug traffic and corruption.

Despite the criticisms, De la Madrid characterized relations with the United States as “positive.”

“Sometimes we have heard some opinions of some minor officials, which we believe are groundless,” he said. “Probably, there is a lack of sufficient information. But there is no doubt that these statements, both on the part of minor officials and of some legislators, provoke an atmosphere of irritation in Mexico.”

Drug Connection Charged

Among charges made during the hearings was that a supposed cousin of De la Madrid, named Edmundo de la Madrid, was involved in drug trafficking. The Mexican president said that investigations “have not shown responsibility of this person, who was mentioned as being a relative of mine,” in such traffic.

“What is more,” he added, “this person appeared before the Office of the Attorney General of the Republic, denied the charges that were made, and placed himself at the disposal of the authorities. Up to now, I do not have any information indicating any responsibility on the part of this relative of mine.”

A presidential spokesman said later that it has not been established whether Edmundo de la Madrid is in fact a relative of Miguel de la Madrid, despite the president’s statement and the coincidence of their last names. If Edmundo de la Madrid is related to the president, the spokesman said, he is not a close relative.

De la Madrid’s statement referring to “this relative of mine” was altered to “this person” in the official transcript of The Times interview.

Talks With Reagan Set

In any event, De la Madrid said that during his talks with Reagan, he will try to “overcome” the negative thrust of the Senate hearings.

De la Madrid’s aides said he will play down differences over Central America in favor of progress in bilateral relations.

As symbols of good will, the United States is expected to sign agreements reopening the U.S. market to Mexican tuna imports, suspended for 5 1/2 years over a fisheries dispute, and to approve a $1-billion loan to Mexico as part of an international package of bailout loans to Mexico.

De la Madrid, 46, will go to Washington as a president under fire. He has presided over four years of a mostly shrinking economy and spiraling inflation. His six-year term ends in 1988.

Dismisses Critics

The economic crisis and political ferment among conservative opposition groups have led to assertions in Washington that Mexico’s ruling Institutional Revolutionary Party (PRI) is losing its grip and the country is on the verge of chaos.

De la Madrid dismissed these fears as baseless.

“We have been hearing these catastrophic predictions for some time, but the truth is that they are totally groundless,” he said.

He contended that state elections in recent years show that “the majority of the Mexican people remain devoted to the principles and action of the majority party.”

‘No Evidence of Irregularities’

The elections he cited--for governor, legislative and municipal posts in the northern states of Sonora, Nuevo Leon and, early last month, in Chihuahua--were marred by incidents of ballot-box stuffing and charges of widespread fraud lodged by opposition parties.

In recent weeks, members of the conservative opposition National Action Party (PAN) have carried out protests in Chihuahua to press demands that the vote be annulled and another election be held.

De la Madrid suggested that the elections were essentially clean and that the call for annulment will go unanswered.

“Until now, I have seen no evidence of the irregularities alleged by the PAN. The problem of the Chihuahua elections is largely a propaganda war, which began long before the elections were held,” he said.

Economic Policies Defended

The controversy, he said, is in the hands of the local electoral commission and the Ministry of the Interior. In any case, De la Madrid said, according to information he received, the PRI won a “significant” victory in Chihuahua. According to the official results, the PRI won the governorship, all 14 state legislative seats and 65 of 67 town halls.

In defending his economic policies, De la Madrid predicted that new loans expected in the wake of agreements reached in July with the International Monetary Fund will lead to economic growth in 1987. He expects that growth to keep pace with the new workers entering the labor market.

Because of steep declines in the price of Mexico’s primary export, oil, the country’s economy “will be unable to grow” this year, De la Madrid said. Most economists foresee a decline in Mexico’s gross national product for 1986.

“We are laying the groundwork for the country to regain a growth rate of between 3% and 4%,” the president said. “This figure was not selected by whim, but corresponds to the growth rate of the available labor force. Thus, what Mexico wants is to generate sufficient employment for the new labor force that is arriving in the market.”

Growth Predicted

He added, “Mexico, ideally, should have an economic growth of between 5% and 6%. I do not think that this rate of growth can be obtained in the next two years.”

De la Madrid predicted that his overall six-year term will be one “with low economic growth.” If so, it would mean that his term will end without the marked economic growth that had been a hallmark of PRI rule since the end of World War II.

In the face of this eventuality, De la Madrid seemed content to point out that his administration will be remembered for not having lost control of the country during a difficult time--”a six-year term full of difficulties, but one in which the people and the government were able to maintain social peace, the strength of our institutions and the basic principles of our national project.”

Reagan and De la Madrid last met in January in the Mexican border town of Mexicali. The meeting produced no specific agreements, although President Reagan pledged to support Mexico’s bids for new international loans.