http://www.kansas.com/mld/kansas/news/s ... 720126.htm

Posted on Thu, Jan. 26, 2006

Corruption probe of Mexican customs agency dogs K.C. proposal

GARANCE BURKE
Associated Press

KANSAS CITY, Mo. - A corruption investigation into the Mexican president's extended family could slow plans to open a high-tech customs facility that would clear trucks for export to Mexico in the heart of the Midwest.

The customs facility, which U.S. and Mexican officials are planning to open in Kansas City in May, would be the first customs house run by a foreign country inside the United States.

Customs agents from both countries would work side-by-side to inspect and seal big rigs full of export goods, and shoot the trucks back out onto the North American Free Trade Agreement corridor, where they could roll through the border without delay.

But in the wake of a corruption probe involving the sons of Mexico's first lady, a Mexican congressional commission is now considering requesting a formal briefing on the Kansas City project and the national customs system. A separate congressional investigation, launched last year, is examining whether the first lady's sons were involved in importing contraband goods from China.

Trade analysts say the proposed inquiry, sponsored by opponents to Mexican President Vicente Fox, better reflects election-year politics in that country than real concerns over trade between the neighboring nations.

"This kind of proposal is exactly what the border needs to become less congested. It's great news," Rafael Fernandez de Castro, an expert on U.S.-Mexico relations at the Autonomous Technological Institute of Mexico, said from his office in Mexico City on Wednesday. "But the new allegations could harm bilateral relations, and Mexicans in particular."

The $3.1 million facility is designed to attract business away from Long Beach and New Orleans, where bottlenecks are causing companies to explore shipping freight through Mexico rather than through West Coast ports. It has also become emblematic of the intertwined nature of politics and business in the NAFTA age.

"We're getting closer and closer to the final stage," said Chris Gutierrez, president of Kansas City SmartPort Inc., a nonprofit that will build the facility. "The U.S. and Mexican teams have developed a final document that talks about their authority and ability to make this happen."

This week, the Mexican government announced it had appointed a director for the customs office and the U.S. officials confirmed negotiations were ongoing. A team of engineers and planners from both countries walked around the project site in Kansas City's old meatpacking district and looked over blueprints.

"This facility is good for Kansas City, it's good for the U.S. and it's good for Mexico," said Kansas City councilwoman Bonnie Sue Cooper. "If there were any negatives to the project, they've never been expressed to us. I guess they're just starting silly season down there."

Lawmakers from the Institutional Revolutionary Party, which opposes the Fox administration, say the Mexican customs agency overstepped its authority in negotiating the project with the U.S. The proposed inquiry, which will likely be voted on next week, links the Kansas City project to a larger corruption investigation involving first lady Marta Sahagun de Fox's eldest son.

"There are indications that corruption could reach the customs terminal in Kansas City," said Deputy Sofia Castro Rios, who represents the former ruling party, the PRI. "We want to know what the project's goals are and who, exactly, will be involved in this customs operation."

The first lady and her family have denied any wrongdoing and say the probes are politically motivated. Sahagun's three sons are from a previous marriage; she and President Fox were married in 2001 and have no children together.

On the American side, interest in the Kansas City project has been building since last year, when U.S. Customs and Border Protection Commissioner Robert C. Bonner called the proposal "bold and imaginative." Mexican government officials confirmed in November the two countries had agreed on the overall proposal.

Supporters for the project range from railroad company Kansas City Southern, whose CEO accompanied Missouri Gov. Matt Blunt on a trip to Mexico last month, to YRC Worldwide Inc., an Overland Park, Kan.-based global transportation company.

Once the agreement is completed, Kansas City would essentially function like a Mexican port. Gutierrez said by 2015, customs agents could process as many as 600 trucks per day, packed full of cars and electronics from across the country.

Analysts said the final negotiations may rest on the perceived reliability of the Mexican customs system. In recent months, the Mexican government has sponsored television spots promoting the efficiency of the country's customs agents.

"There is no question that over the last 10 years there has been enormous progress and transparency as it relates to customs in Mexico," said Robert Pastor, director of the Center for North American Studies at American University. "Whether there is total transparency, I don't know."