COLUMN ONE : Mexico’s Manifest Destiny : The nation is reaching south into Latin American economies, taking over markets and buying up companies. It’s generating the kind of resentment that the U.S. has provoked for decades.

For generations, Mexicans have believed that geography destined their nation to be Latin America’s bulwark against Yankee imperialism. But lately, the old mission of defending sovereignty throughout the region is starting to conflict with Mexico’s new role as a leader among Latin America’s emerging free-market economies.

These days, Mexico is extending its own economic clout southward. Mexicans dominate the Spanish-language mass media. They are taking over markets, buying up companies and, in an ironic twist, generating the kind of resentment that North Americans have provoked in Mexico for decades.

In the process, Mexicans wonder if they are becoming what they most despise in their northern neighbor; they see signs that they are turning into economic imperialists.

Mexico produces only 5% as many goods and services as the United States, but that is double the size of every Latin American economy except Brazil’s. Mexicans own three of Latin America’s five largest banks, run the region’s biggest cement company and account for 37% of the area’s oil production.

Guatemalans eat ice cream from a Mexican franchise they see advertised on Mexican television, a super-network that spans Latin America.

Throughout the civil war in El Salvador, a buffet of tacos and Mexican chorizo was served every Wednesday around the pool of a Mexican-owned hotel in the capital while mariachis blared over the sound of bombs being dropped on the slopes of the nearby San Salvador volcano.

More than 2,000 alumni of Mexico’s prestigious Monterrey Technological Institute live in Latin American countries outside Mexico. Many of them run major corporations based on principles they learned at “the Tec,” a bastion of the private enterprise philosophy that is sweeping the region.

“Mexico is like a godfather to us,” said Emilio Rappaccioli, a consul at the Nicaraguan Embassy here.

This is an influence that Mexicans both relish and shun. They see their own relationship with the United States reflected in the way they deal with other Latin American countries.

They prefer to view themselves as a model of development for the region--a country with a balanced federal budget that is well on the way to a modern market economy and single-digit inflation. Less often, recalling their own struggles against U.S. influence, Mexicans worry that they are trying to sway events in other countries too much.

Despite such concerns, Mexicans can still be as insensitive and condescending toward smaller countries as any gringo talking about Mexico.

“Central Americans are friendly, they are warm, but they are lacking something,” said Ivan Crippa, a businessman active in advising Mexico’s trade negotiators in talks with Central America. Specifically, he said, Nicaragua lacks clear foreign investment laws, and Costa Rica, Guatemala and Nicaragua--each of which produces a local beer labeled Corona, the same brand name as Mexico’s top brewery export--don’t enforce trademarks.

“American companies said these things about Mexico, and they were right,” Crippa added.

Because their countries need the investment, Latin Americans generally are reluctant to criticize Mexico’s international companies in public. But privately, they complain about Mexican arrogance. To deflate it, they poke fun at the Mexican penchant for titles and the baroque forms that are considered polite speech here, formalities that for other Latins symbolize Mexican ostentation.

“In my country, only lawyers are licenciados ,” said an Argentine university professor, using a term that in Mexico is applied to anyone with a bachelor’s degree. “And don’t you dare confuse an engineer, an architect or a public accountant with a mere licenciado ,” added the professor, who asked that his name not be published because of politics at the Mexican university where he teaches.

Then there are the quaint phrases, such as “at your service” and “if it isn’t inconvenient,” that are routinely inserted into conversations in Mexico but sound superfluous in the rest of the Spanish-speaking world. The epitome of such expressions is mande , which is used in the sense of “I beg your pardon” but literally means “Order me.”

” Mande is a relic of colonialism,” a Cuban diplomat sniffed disdainfully.

Despite such misgivings, other Latin Americans look forward to teaching, studying and vacationing in Mexico, much the way Mexicans enjoy traveling to the United States. Tourism and industrial development ministries in the region eagerly seek investments and know-how from the well-known Mexican hotel chains Camino Real and Posadas de Mexico or industrial giants such as Vitro, the Monterrey-based glassmaker.

In some cases, however, southern countries have resisted Mexican advances.

Monterrey-based cement powerhouse Cemex was rebuffed twice in its attempts to buy cement companies from the Honduran government. Cemex, the world’s fourth-largest cement firm, tried in 1991 and again last year to buy different companies.

“In one case, they sold the company to the army,” said Gustavo Caballero, Cemex’s finance and planning director.

The second sale, to date the largest privatization in Central America, was made to Honduran investors for $76 million. Cemex’s offer of a complex debt-for-equity swap that would have wiped out $50 million of Honduras’ debt to the Mexican government never even received a public response. In both cases, company officials insisted from the start that the plants should remain in Honduran hands.

Such rejection surprises and bruises Mexicans just as some North American business people are shocked to learn that they are not always welcome in Mexico. A common reaction is to overlook the evidence.

“The case of Honduras was an exception, not at all typical of attitudes toward Mexican investment,” said Eduardo Fuentes, director of international projects at Bancomext, the Mexican government export-import bank.

“Mexico has a special place in Latin America,” insisted Roberto Servitje, chief executive of Organizacion Altex, Mexico’s top bread and cupcake producer. “We are an example to follow, and we are always well received.”

Mexico styles itself Latin America’s gateway to the North American market, the first link in the Initiative of the Americas. The initiative, originally proposed by the Bush Administration, would create a free-trade zone from Alaska to Tierra del Fuego, beginning with the pending North American Free Trade Agreement among Mexico, the United States and Canada.

To make the gateway concept work, the Mexican government is seeking free-trade agreements with southern countries.

Chile already has signed, and talks are under way with Colombia, Venezuela and five Central American nations.

At the same time, Mexican companies are evolving into multinational corporations. For them and for Mexico, the rest of Latin America is a natural expansion target.

“Mexico needs not just Central America but also South America in order not to be alone against the United States,” said Isolda Melendez, a Nicaraguan economist who lives in Mexico. “Mexico’s negotiating position is much stronger if it has a following.”

In asserting leadership, Mexicans are offering more advice about how other countries should be run to put their economies in order and are using the other nations’ debt to Mexico--mostly the result of oil-related trade deficits--as leverage to press their viewpoints.

The change is clear in Nicaragua. Mexican politicians defended the Sandinista administration in the 1980s. But business people interested in investing there in the 1990s are impatient with the Sandinistas still in power, such as the chief of the army, Gen. Humberto Ortega, brother of former President Daniel Ortega. They are seen as vestiges of an outmoded, anti-business attitude.

“They should send Ortega to Switzerland as ambassador and get him out of the country,” said Crippa, who decided against buying a cardboard factory because Sandinistas lead the plant union. “They have to eliminate the guerrilla mentality.”

Mexicans would consider such a statement from a U.S. business executive an unconscionable interference in domestic affairs. However, businesses with investments in a country tend to worry about that country’s domestic policies, sometimes to the embarrassment of their governments.

“We are trying to be careful about our approach,” Fuentes of Bancomext said. “There is a certain fear that the giant of the north is coming to take control.”

That fear is especially evident in Central America, an isthmus of countries that are smaller than many Mexican states, with a total population roughly equal to that of the Mexico City metropolitan area.

Mexico has defended controversial Central American governments in international forums and sold the countries oil on easy payment terms, allowing them to run up $1.4 billion in debt, a huge amount compared to the size of their economies and their exports. But the few Mexican companies that ventured into Central America during the tumultuous 1980s were often treated as ugly imperialists. Their executives were targets of guerrillas and, occasionally, of local authorities.

Modelo Brewery’s distributor in Guatemala was jailed for trademark infringement, for instance, when the Mexican beer company tried to enforce its international trademark for the Corona brand against the local competitor using the same name.

Central Americans, for their part, worried that Mexicans would exploit them.

Crippa, whose businesses include a rum producer called Ron Potosi, recalls a reception at which he tried to persuade an executive at Flor de Cana, a Nicaraguan rum distiller, to distribute the Mexican brand in Nicaragua. In return, Crippa would distribute Flor de Cana in Mexico.

“No, you will steal my trademark,” the man told Crippa.

When Crippa insisted, “he stood up and left.”

The Mexican executive still bristles at the memory. “This is the mentality in all of Central America--fear,” he said.

Guido Willis, a consul at the Costa Rican Embassy in Mexico, explained, “Our industrialists have the same fear of signing a free-trade agreement with Mexico that Mexican industrialists have of signing a free-trade agreement with the United States.”

Central American governments are telling business to put those fears aside and to change a ludicrous situation in which the region accounts for only one-tenth of 1% of Mexico’s trade. Many Central American nations have more commerce with Germany than with Mexico. Throughout Latin America, U.S. franchises and products are still far more in evidence than any from other countries of the continent.

But such change does not come easily. Mexico shows little willingness to modify policies that resulted in a $340-million trade surplus with Central America in 1991--with Mexico selling three times what it bought. In fact, in recent months, Mexico has raised trade barriers against sugar and beef, its main imports from Central America.

Other countries also feel at a disadvantage because of Mexico’s restrictions on foreign investment.

“We are much more open,” said Hugo Barrera, chairman of Diana, a Salvadoran snack food maker. “They can come in and form a 100% Mexican-owned company. But if we want to set up a company in Mexico, there are plenty of restrictions.

“If they want part of our market, they need to give us a chance to take part of theirs.”

Businesses in other Latin American countries aren’t eager for their nations to tear down their own tariff walls, fearing that they’ll be gobbled up by larger Mexican competitors.

That is already happening. During the last two years, Organizacion Altex, the Mexican bakery giant, has bought bakeries in Guatemala and Chile, increasing its share of those markets. Last September, the company acquired Venezuela’s top industrial cupcake and pastry maker--for $2 million, just 1% of Altex’s annual budget for acquisitions, plants and equipment.

“We have plans to keep on growing, into El Salvador, Brazil and Argentina,” Altex’s Servitje said. “We are not discarding the possibility of Cuba in the future.”

Mexicans buying companies in Latin America have the purchasing power to take over major chunks of markets and change consumer habits. Those purchases are noticed because they reflect a level of influence that in another time and context would have been called imperialism. Mexicans even compare their products to trademarks that have become symbols of U.S. imperialism.

“It’s a little bit like Coca-Cola,” Servitje said of his best-known snack brand, a line of cream-filled cupcakes. “Our first aim is to create brand awareness. You make the product available, then you develop the demand for it through marketing.”

Grupo Maseca, Mexico’s biggest maker of tortilla mix, has reintroduced the corn product in Costa Rica, which had become a wheat-eating country. This year, Maseca will test-market tortillas in Barquisimeto, a city of about 1 million people in northern Venezuela, as a substitute for the traditional arepa , a sort of corn fritter. The $365-million-a-year company already has psychologists at work on a strategy for persuading Venezuelans to change their eating habits.

Besides sophisticated market research and larger-scale production, which reduces costs, Mexican companies have television on their side. Televisa, the Mexican media giant, has been buying up broadcasters throughout the region to create a super-channel, originating in Mexico City. After decades of creating Latin America’s media stars, Televisa is now dictating consumer buying habits.

Grupo Quan has found a ready clientele for its Holanda and Bing ice-cream parlors among viewers of the “Channel of the Stars,” the regional channel. Quan began expanding into Central America in 1991 and is spreading southward.

“They already knew our brands,” said Jose Luis Gonzalez, president of Quan, Latin America’s biggest ice-cream maker and a steady advertiser on the Televisa super-channel.

Occasionally, companies from other countries have benefited from the regional channel. Angelitos, a Salvadoran stuffed-toy maker, once appeared on a news show; orders poured in from all over the Americas. But with few exceptions, only Mexican companies can afford to advertise consistently on the channel, leaving competitors at a distinct disadvantage.

“How do they see Mexico?” asked businessman Crippa, who then answered: “Mexico looks very big to them. They say they want to protect their industries, but what are they protecting? Many of these countries are 20 or 30 years behind the times.”