A new era of undocumented bond speculators?

A Mexican politician suggests that migrant workers in the U.S. buy bonds issued by the state oil company, instead of sending their money home to their families

By Andrew Leonard

Published April 17, 2008 10:42PM (EDT)

After a hard week of work, a Mexican immigrant in the United States takes his pay-check (or cash) to the nearest Western Union outlet, where the money is digitally transferred to his cellphone account. But then, instead of zipping the "remittance" back home to his relatives, he buys a bond issued by Pemex, the troubled Mexican national oil company.

Sound far-fetched? Not if you listen to what Mexican politicians have been saying in recent weeks. As part of a government-backed plan to reform Pemex, the energy minister, Georgina Kessel, announced last Wednesday that the oil company would issue 5 billion pesos ($474 million) worth of "citizen's bonds." The goal, in addition to raising cash for Pemex, is presumably to strengthen the sense of personal connection ordinary Mexicans feel for a cherished symbol of national sovereignty, even as the rest of the reform package makes it easier for Pemex to do deals with foreign oil companies.

A member of the former ruling Institutional Revolutionary Party (PRI), Congressman Edmundo Ramirez Martinez, added another twist when he suggested that the bonds be sold to Mexican migrant workers as a means of "putting remittances earned in the United States to good use back home." Martinez serves as the secretary for the border and migrant affairs commission in the Mexican Chamber of Deputies.

From Frontera NorteSur:

"If we offer them a return of 10 percent, many Mexicans who have gone to work in the U.S. for lack of employment, could then have an important investment and an additional income for their families," Martinez said.

Combine the Pemex bonds aimed at migrant workers with Western Union's recently launched plan to allow immigrants to send their remittances back home via their cellphones, and you're talking some cutting-edge cross border investment flows.

Will it play along the Rio Grande? Finance minister Kessel says the yield on the bonds will be tied to the company's financial performance. But given that Pemex is considered an international laughing-stock, counting on migrant workers to invest their very hard-earned wages in Pemex bonds might be a stretch. Even if it buying one requires little more than a cellphone.

UPDATE: Two errors in this post: I wrote five million pesos, when it should have been five billion. And Kessel is energy minister, not finance minister. I regret the errors.

Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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