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Fox Heading for Setback in Mexican Congressional Election

Official, partial results from Sunday's midterm election in Mexico indicate a clear setback for President Vicente Fox and his National Action Party, known as the PAN. In order to get anything through the new Congress, Mr. Fox will now have to bargain with the party he removed from power three years ago, the Institutional Revolutionary Party, known as the PRI.

The best hope of President Fox and PAN leaders had been to win a simple majority in the House of Deputies, all 500 members of which were replaced in this election. Instead, the PAN lost ground and the future of the Fox program seems ever more clouded.

Based on preliminary results, the head of Mexico's independent Federal Electoral Institute, Jose Woldenberg, says the new Congress, which goes into session in September, will remain deeply divided.

He says the PAN will have between 148 and 158 deputies in the lower house of the legislature. The PAN has 207 seats in the current assembly. Mr. Woldenberg says the PRI will have between 222 and 227 deputies, up slightly from the current 202. The left-leaning Party of the Democratic Revolution, or PRD, gained the most in the balloting. It will have between 93 and 100 seats, as opposed to its current 54.

The PRD was part of a coalition with smaller parties in the year 2000 election and had to share seats in the Congress with them. In this election, the party ran its candidates alone. In Mexico, a large number of seats in the Congress are apportioned to the parties based on the overall percentage won in the election.

Next-day analysis of the election results ranged from pronouncements of disaster for the Fox government to suggestions of how the president might learn to negotiate more effectively to get his reform proposals approved. Commentator Denise Dresser says President Fox is likely to spend the next three years as a ceremonial figurehead with no hope of advancing a program. Other analysts, however, say Mr. Fox may still be able to salvage some parts of his agenda by reaching out to the PRI, the PRD, and smaller parties to find consensus.

International financial experts say such an effort will be necessary in order to accomplish reform in the energy sector as well as in areas such as labor and the tax system. Without those reforms, they say, Mexico is likely to have its credit profile lowered.

Mexico is already losing jobs to China and other Asian nations with lower wages, guaranteed energy supplies and fewer regulations. With more than 40 percent of its population below the poverty line and several million of its citizens living illegally in the United States in order to find work, analysts say Mexico cannot afford to wait until the next presidential election, in July, 2006, to solve its urgent problems.