NSSD 5-87 Mexico

UNULASSIEIEU THE WHITE HOUSE SYSTEM II SECRET 90041 WASHINGTON January 22, 1987 NATIONAL SECURITY STUDY DIRECTIVE NUMBER 5-87 Mexico let This directive sets forth the terms of reference for an interagency review of the situation in Mexico and our policy toward that nation, now and in coming years. Let Mexico is entering its fifth year of serious economic difficulties. Social, political, administrative, and criminal problems also increasingly afflict it. Relations between our two governments are relatively friendly, but they are subject to periodic aggravation, reflecting a tension which makes frank, in-depth discussion of common concerns difficult. 18T Mexico is now in the process of absorbing substantial new loans acquired in the context of a wider debt restructuring package, with the avowed intention to undertake basic structural reforms. On the political front the PRI system continues its dominance but faces growing pressure for reform from within and increasing disenchantment, even opposition, from segments of the population. Attention is rapidly turning now to the succession to President de la Madrid in September 1988. (8) The prospects for stability in Mexico depend mainly on the PRI's ability to be flexible in meeting new challenges. They also depend on continued support by the U.S. government, our banks, our private sector, and the international financial community. But certain practices and policies of the Mexican system impede economic recovery and hazard foreign support. Mexican foreign policy, particularly with regard to Central America, is a continuing irritant in our relationship; issues arising from our common border, most particularly drugs and immigration, are also matters of concern. 1st An interagency review should therefore consider, inter alia: -- the future course of the Mexican economy and the prospects for basic economic reform; the prospects for continued external support from oil earnings, trade, investment and loans; -- social and political trends in Mexico, with particular attention to the presidential succession, the pressures for reform, the coherence and efficacy of the PRI system, and SECRET eclassified on 10-9-96 Declassify on: OADR under provisions of E.O. 12998 i) an Tassel. National Security Coum: UNCLASSIFIED F88-739 S