Outgoing Mexico President Seeks Role on World Stage : Latin America: Salinas is a top candidate for global trade post. His close ties to the U.S. come under scrutiny.

For six years, Carlos Salinas de Gortari has used the power of the Mexican presidency to transform his nation, cementing a free-market economic revolution and initiating political reform so profound that it has deeply divided his own party.

Salinas will turn over the authority of a virtually unchecked executive branch to his successor, Ernesto Zedillo, on Thursday. But at age 46, the Harvard-educated economist hardly seems ready to retire to the life of behind-the-scenes intrigue that usually occupies former presidents here.

More than any Mexican president in two decades, Salinas appears intent on playing an international role. He is one of three leading candidates for the top position in the World Trade Organization to be created as a successor to the General Agreement on Tariffs and Trade--the largest international trade pact, with 124 members.

Salinas brings to his bid a striking record of having converted an inward-looking, protectionist country into a leading free-trader, a member of the most important international economic organizations and a founding partner in the world’s largest trading bloc, the North American Free Trade Agreement.

At the same time, the possibility that he might head the economic equivalent of the United Nations, equipped to tear down barriers to trade and investment around the world, has made his administration a subject of closer international scrutiny than Mexican leaders usually receive.

Along with the economic accomplishments, such as slashing triple-digit inflation to about 7% in six years, there have been political pitfalls. Salinas leaves office with a peasant rebellion still simmering in the southern state of Chiapas and two major political assassinations still unsolved.

Election reforms guaranteed that his successor was chosen Aug. 21 in the cleanest polls since the Institutional Revolutionary Party began ruling the country 65 years ago. Still, those elections were fraught with irregularities, observers said, and fraud was again rampant in state elections in Jalisco and Tabasco earlier this month.

Further, even modest attempts at political reform have set off a battle within the ruling party. Polls show most Mexicans believe that political infighting was behind the murders of Luis Donaldo Colosio, Salinas’ first choice for a successor, and Francisco Ruiz Massieu, the second-ranking party official.

Serious questions even exist about who has benefited from economic reforms. Two dozen Mexicans have made the Forbes magazine list of the world’s richest people. Mexico was one of a handful of developing countries that have actually reduced the number of citizens living in absolute poverty, according to a recent United Nations report, but half of the workers still earn less than $12 a day.

Both the accomplishments and the problems have been reported widely, especially since Salinas has made what appears to be the final round in the World Trade Organization selections.

That Mexico and Salinas should be taken so seriously in international circles is in itself a feat hardly anyone could have imagined six years ago, when the short, balding man with the big ears took office.

Cartoonists called him “Dumbo” in an astounding display of disrespect in this usually deferential country. Many observers seriously doubted whether he could govern Mexico, as opposition parties protesting election fraud were cleared from the main plaza with tear gas only hours before his inauguration.

In the following weeks and months, Salinas won through his actions the legitimacy denied him at the polls. He arrested a powerful union boss, imprisoned a prominent financier and started a bold economic program of selling off hundreds of government-owned companies, balancing the federal budget and reviving international investment.

Nearly three-fourths of the 2,550 Mexicans questioned earlier this month in a nationwide Indemerc Louis Harris poll said the country was better off now than when Salinas took office in 1988.

How Salinas achieved those accomplishments--as much as the accomplishments themselves--is being considered in judging his ability to head the World Trade Organization.

For example, NAFTA, the historic trade pact among the United States, Mexico and Canada, will turn 11 months old the day Salinas steps down. The agreement is both the greatest asset and the major drawback in his bid to head the proposed trade organization.

“The impact of NAFTA worldwide is an important part of his credentials,” said Gabriel Szekely, an expert on Mexico-Asia trade and investment. “For economies of such diversity to be able to negotiate and to achieve such a degree of liberalization, getting into several areas that not even GATT did” is a notable achievement.

At the same time, heading a nation that is part of NAFTA and depends on the United States for three-fourths of its foreign trade makes Salinas appear too close to Washington for the tastes of European and Asian countries, said Szekely.

“They see the Salinas government as being completely sold out to the U.S. government,” he said. Ironically, that is the same criticism leveled at the outgoing president by opponents of free trade in his own country.

Salinas missed an opportunity to change that perception--at least internationally--at the Asia-Pacific Economic Cooperation meeting in Indonesia earlier this month. Asian members looked to Mexico for support in their opposition to Super 301, a section of American trade law that allows the United States to unilaterally impose tariffs of up to 100% on countries deemed to have erected the most egregious trade barriers. They were disappointed.

The limitations of Salinas’ contacts in Europe are evidenced by Mexico’s failure to attract more investment from across the Atlantic, said Mexican economist Rogelio Ramirez de la O.

The perceived closeness to the United States may have tarnished Salinas’ image more among trading nations than the political upheaval that has occurred in the wake of his economic reform. On the other hand, the other candidates--former Italian Trade Minister Renato Ruggiero and former Korean Industry and Trade Minister Kim Chul-su--also have strong regional ties to overcome.

As a result, Salinas’ qualifications for founding director of the proposed new trade organization hinge largely on his ability to reconcile conflicting interests. The director of the World Trade Organization is expected to be mainly a conciliator.

“The job can carry considerable clout, depending on the skills of the person,” said Patrick Low, an economist who has worked at GATT and written extensively on international trade policy. “But you have to have a mediator” in the post.

Throughout his administration, Salinas emphasized public shows of reaching consensus. Labor and business leaders were called in to negotiate the pactos , the economic agreements on Mexican wages and prices that were used to bring inflation under control and restore economic growth. Both groups also advised the NAFTA negotiators.

“Mexico has changed enormously during his presidency, and he has led it,” said Low, who has also served as a visiting scholar at the prestigious El Colegio de Mexico graduate school in Mexico City. “He has often had to work very hard for consensus.”

But behind the compromises, Salinas always had the enforcement power of the presidency.

“Definitely the powers of the presidency were overarching” in achieving domestic consensus, said Szekely. He claims that business and labor leaders actually did little negotiating in the agreements. “It was just a ‘photo op’ with the finance minister,” he said.

Ramirez said not even a president could have made changes as profound as those Mexico has undergone during the past six years without reaching consensus.

“Salinas is a great negotiator,” said Ramirez, who is often critical of the government. “He knows how to distinguish which subjects require the maximum attention. He knows how to think strategically. He knows where the trends are going, where the centers of power are and where the trade-offs can be made.”

Mexicans themselves are divided over whether they want their outgoing president to be named to the prestigious international position.

“He would be an excellent director,” said Ramirez.

Others are skeptical about both his chances and qualifications. “I hope he is not elected,” said Szekely. “There are still a lot of accounts to be settled here.”